The Victoria Police IT department was riddled with dodgy multi-million-dollar deals, records were a shambles and staff were cashing in on free hospitality when there was no one in charge, a report shows.
A scathing Ombudsman's investigation has blasted the Victoria Police Business Information and Technology Services Department (BITS) for gross mismanagement of taxpayer funds.
The report, tabled in state parliament on Thursday, found records of IT contracts worth tens of millions of dollars were kept on handwritten notes, while other files were missing or poorly kept.
Contracts were awarded without going to tender or by bypassing proper process.
And at the top no one was in charge, with the former chief information officer Valda Berzins admitting she did not keep tabs on the department's budget, worth almost $200 million.
"Ms Berzins acknowledged that she did not closely monitor the operation of the BITS budget, which in 2008-09 was approximately $191 million," Ombudsman George Brouwer said in the report.
That responsibility was left to group manager of business and planning John Brown "by virtue" of his position, he said.
"The extent of Mr Brown's control over knowledge of BITS finances and the general lack of proper records is best illustrated by the fact that Victoria Police's figures relating to the funding of a contract worth in excess of $27 million are largely based on a handwritten note he provided to a BITS manager in a meeting several months after his resignation."
Mr Brouwer described record keeping and file maintenance within the department over the past three years as "largely inadequate".
"My investigation was hampered by gaps in documentation, records that were not dated, not signed or did not include author details, and a general lack of any apparent systematic record-keeping," he said.
"My investigators were often required to go to a number of sources to locate documentation and in some instances had to make requests direct to vendors regarding key documents relating to multi-million dollar contracts that Victoria Police had not retained or could not locate."
Mr Brouwer said the investigation uncovered several examples of managers' apparent disregard for proper procurement and contract management processes.
In one case, documents for a $20.1 million contract were prepared in 24 days when it should normally take 10 to 18 months.
The contract was not put to tender in exchange for a 90 per cent discount that was never scrutinised, the report said.
The department gained approvals to redirect security services from IBM to Fujitsu but the contract blew out to $27.2 million - $15 million more than had been approved.
The ombudsman also identified conflicts of interest, with staff cashing in on free hospitality from IT companies, including tickets to the Australian Open Tennis, the AFL Grand Final and the Melbourne Cup.
In another case, external contractors engaged by the department were involved in a procurement process that they were tendering for.
Mr Brouwer said three external reviews, five internal audits and two criminal investigations had been conducted into the contracts, finances and reporting of the department since 2006.
They revealed a $39 million funding gap as a result of contracts entered into, managers breaching their financial duties, breaches of state procurement guidelines and a culture of staff inappropriately accepting hospitality.
"Despite these earlier findings, Victoria Police has only recently undertaken remedial action to address the concerns raised in these reports," Mr Brouwer said.
Police chief commissioner Simon Overland admitted the behaviour described in the report was "embarrassing".
"It is embarrassing, yes, obviously no one likes to receive criticism of this nature, but I have to say I think the ombudsman has been very thorough and very fair," he told reporters.
"I accept the findings the ombudsman has arrived at and the recommendations he has made in terms of what we do to fix the issues that he has identified."
Mr Overland said the behaviour of accepting gifts and hospitality, such as tickets to the grand final and Melbourne Cup, was unacceptable.
"I would hope that that is understood now, we've certainly taken steps to reinforce that," he said.
"We have new policy drafted and in place, there is a broader government review being conducted by the State Services Authority on this question.
"I don't believe my senior managers are under any misapprehension around what are appropriate gifts, benefits and hospitality."
ninemsn.com.au 12 Nov 2009