Rehiring IBM to maintain troubled software it created was part of a fair and open bidding process, said Community and Social Services Minister Helena Jaczek on Monday, responding to concerns about the ongoing relationship between IBM and the Ontario government. On Saturday, IBM had won a $32.2 million, two-year contract beginning April 1 to maintain SAMS — short for social assistance management system — which manages payments for the 900,000 Ontario residents on social assistance.
The contract allows for another two years in extensions, for a total of $50 million over four years. But Smokey Thomas, president of the union representing the province’s case workers, said IBM should be “fixing” its mistake-riddled program “under warranty.”
Jaczek told reporters at Queen’s Park the new contract isn’t intended to repair SAMS.
“It’s a routine maintenance contract,” she explained. “Every large IT system needs a contract like that and of course it was issued through a competitive process and the successful bidder was IBM.”
“IBM is allowed to compete like any other company,” she said.
No fairness commissioner
Other potential bidders on the same contract they wondered why the bidding process didn’t require a fairness commissioner, since it was clear there would at least be the appearance of a conflict if IBM was allowed to participate.
A fairness commissioner is an independent third party hired by the province for procurement in large contracts to, among other things, “bolster vendor and citizen confidence in public procurement practices,” according to a sample of fairness RFPs.
ministry spokesperson Joshua Henry did not say why no commissioner was used in the process, but did say the contract will be reviewed by the auditor general.
“We reached out to the auditor general to tell her about this contract. She will review the oversight of this contract as part of her regular follow-up review in the spring [of] 2017. We look forward to that,” Henry wrote.
“The ministry has asked internal audit to review the contract to help ensure appropriate oversight and management of the vendor has been implemented, following the auditor general’s recommendations.”
The auditor general delivered a scathing report in December blaming the ministry and IBM for going online with SAMS in spite of the software’s problems, which have cost millions and sent the program over budget by late 2015, totaling close to $300 million.
The software’s errors included overpayment, underpayment and cheque delays for some of Ontario’s most vulnerable citizens.
It also created and continues to create headaches for case workers in the province who say some of the workarounds used to fix the system mean hours of extra work.
Opposition weighs in
The leader of the Ontario Progressive Conservatives, Patrick Brown, said the new contract shows the province is throwing away more good money after bad.
“This government can never acknowledge when they make a mistake,” said Brown on Monday.
“They continue to double down and waste more taxpayers dollars.”
Ontario NDP leader Andrea Horwath said the software continues to hurt the province’s most vulnerable, while the latest contract serves to erode public confidence.
95 per cent of problems fixed, ministry says
The ministry says the software has some remaining defects in need of repair, which would fall under the purview of the new contract, though that number is limited, according to Henry.
“Of the 737 defects identified by the auditor general as of November 2014, 691 defects have now been fixed — approximately 95 per cent,” Henry wrote.
“We have now fixed 100 per cent of the priority issues identified by our front-line staff working groups, and 98.3 per cent of all help-line calls have been addressed to date.”
But the Ontario Public Service Employees Union some case workers still have to problem-solve issues on a daily basis, and that there’s still the potential for overpayments and underpayments on client files if case workers don’t take extra steps to work around the problem.