August 2017

1

Special Inquiry into Government Programs and Projects

Submission from the Department of Health

1. Overview

The Terms of Reference of the Special Inquiry into Government Programs and Projects (the Inquiry) state the focus of the Inquiry is to examine the programs and projects under review (which include eight Health projects), focussing on the associated governance arrangements and decision-making processes. In the period under review, 2008 to 11 March 2017, the Western Australian public hospital and health system has undergone much transformation and improvement, particularly in the areas of governance, procurement and project management.

The WA health system welcomes any additional measures identified by the Inquiry which could be introduced to ensure greater rigour and transparency in decision making and to ensure value for money outcomes when undertaking future programs and projects.

Over the past four years the WA health system has implemented a system-wide reform program to ensure that the WA health system has the capacity and capability to deliver on its intent to provide a safe, high-quality, sustainable system for Western Australians; catalysts for the reform program include:

the WA health system’s intent to deliver a safe, high-quality, sustainable WA health system for Western Australians, and focus on continuous improvement;

the need to deliver financial sustainability; and

a suite of recommendations made in reviews into several major Health projects by external agencies, focusing on the need for:

o system-wide governance reforms;

o significant improvement in contract management skill and practice; and

o enhanced procurement practices.

Key changes to the WA health system over the past four years include the implementation of the most significant governance reforms to the WA health system in 90 years (via the Health Services Act 2016) and the implementation of the procurement reform project (WA Health Strategic Procurement Program). Application of these reform and improvement initiatives is helping ensure that past failures and weaknesses are not repeated.

When the Inquiry is undertaking its analysis of the eight Health programs and projects it may be useful to note that the WA health system has implemented initiatives to address issues in several program and project areas including system governance, accountability, financial management as well as Information and Communications Technology (ICT) governance and procurement.

2. WA Health System Reform

The WA Health Reform Program 2015 – 2020 (Reform Program) was pivotal to ensuring that the WA health system is taking steps to achieve its intent to deliver a safe, high-quality, sustainable WA health system. Over the past two and a half years the WA health system has undergone significant, much needed, reform.

2

The Reform Program focuses on key enablers for the WA public health system, including:

workforce;

accountability;

financial management;

partnerships;

infrastructure;

ICT and support services; and

research and innovation.

Some of these key enablers, in particular accountability and financial management align closely with the scope of the Inquiry. Recently, reform instigated by the Reform Program has occurred within both project management and procurement. These reforms have improved the governance arrangements and decision-making processes of WA health system programs and projects.

The WA health system’s reform journey has led an improvement in the performance of the WA health system, which will deliver further benefits as the recently established programs and projects are “bedded down”.

2.1. Governance of the WA health system

Prior to 1 July 2016 the Hospital and Health Services Act 1927 governed the WA health system. The roles, responsibilities, powers and functions set in the outdated Hospital and Health Services Act 1927 were too centralised, did not fully support decision making closer to the patient and did not reflect the size and complexity of the modern WA health system. The outdated legislative framework was unduly complex and not reflective or supportive of operational practice for a 21st century public hospital and health system. Lines of authority, delegation and accountability were blurred and not well understood. The Director General had no direct capacity or statutory mechanisms to control the State’s health service entities. The Director General’s control was achieved through the Minister, acting as the board of the amalgamated hospital boards, delegating their authority to the Director General to manage hospital and health services and a reliance upon the authority as a CEO of a department of state assisting the Minister in discharging their obligations under the Public Sector Management Act 1994.

As a result of these legal uncertainties and administrative complications in the WA health system there were multiple recommendations that legislative change was required, including the Reid Report1 and the More than Bricks and Mortar Report2 into the Commissioning of Fiona Stanley Hospital. Despite numerous minor amendments over time, the Hospital and Health Services Act 1927 remained incapable of exercising the robust framework that was required to support the governance requirements and challenges faced by the WA health system in the 21st century.

Contemporary legislation underpinning robust governance arrangements was critical to support decision making, strengthen the WA health system in a cohesive manner and better position the system to respond to the changing needs of the Western Australian community. The publication Better Health, Better Care, Better Value which established the Reform Program acknowledged that the WA health system’s governance should be open and accountable to support clinicians, managers and all staff to fulfil their roles to the best of their ability. The Western Australian health system was too large and too complex to continue to be run on the existing centralised

1 Health Reform Committee (2004) A Healthy Future for Western Australians (the ‘Reid Report’)

http://ww2.health.wa.gov.au/~/media/Files/Corporate/Reports%20and%20publications/PDF/Report_of_the_Health_Reform_Committee.ashx

2 Education and Health Standing Committee (2014) More than Bricks and Mortar

http://www.parliament.wa.gov.au/Parliament/commit.nsf/(Report+Lookup+by+Com+ID)/E994CCC08CB1A1A748257CB6000591E4/$file/140408%20EHSC%20Report%202%20FINALv2.pdf

3

governance structure with decision-making and accountability concentrated solely with the Director General. Changes were required to clarify roles, responsibilities and accountabilities at all levels and allow decision-making to be allocated more fairly across the WA health system and therefore, better meet the health needs of our communities.

As a part of the Reform Program a new governance framework was developed to replace the Hospital and Health Services Act 1927. On 1 July 2016, the Health Services Act 2016 commenced operation introducing a contemporary devolved governance model for the WA health system. The Health Services Act 2016 clarifies roles and responsibilities at each level of the system, establishing the Director General of the Department of Health as the System Manager responsible for the overall management of the WA health system and the Health Services (Child and Adolescent Health Service, East Metropolitan Health Service, North Metropolitan Health Service, South Metropolitan Health Service and WA Country Health Service), the Quadriplegic Centre and Health Support Services as separate statutory authorities referred to as Health Service Providers. Department of Health officers now play an important role in supporting the Director General to fulfil all of his/her legislative responsibilities as the System Manager.

The Health Services Act 2016 ensures that roles and responsibilities are clear at every level of the system and that the WA health system will continue to improve health outcomes through decision making being closer to the patient, by those working in the system who can deliver better patient care and better value. One year in, the new governance model has been successful in establishing separate statutory authorities with significantly more responsibility and accountability.

Prior to the legislative and governance changes significant progress was made in the areas of procurement and project management and the devolution enhanced the importance of clear roles and responsibilities between the Department of Health and the Health Service Providers. The System Manager, supported by Department of Health officers, is now responsible for setting the expected standards across the system with regards to procurement and project management. To ensure recent progress made in these areas is not lost, clear, comprehensive procurement and ICT policy frameworks have been established (a legislative mechanism used to bind Health Service Providers and hold them to account to standards set by the System Manager)3.

Change to the governance of the WA health system is an important step towards delivering a safe, high-quality, sustainable WA health system for Western Australians. Although all of the Health projects under review by the Inquiry pre-date these governance changes it is important to be aware of the environment in which these projects were established and were operating within and the new, current state at which the WA health system has now arrived and which addressed issues of concern to the WA health system and external reviewers, and may be highlighted by the Inquiry.

2.2. Procurement

In 2014/15, the WA health system’s annual spend on procurement equated to nearly 50 per cent of the WA health system’s $8 billion budget. This included everything from the purchase of hospital services, community and aged care services and patient transport to the supplies used every day in our hospitals around the State. Over the past 10 years, the Office of the Auditor General has published a number of reviews focused on the efficiency of procurement arrangements and the contracting environment within the WA health system which have caused the WA health system to review its procurement practices and arrangements.

As indicated in the initiation document of the WA Health Strategic Procurement Program in the past, the WA health system’s previous standards of procurement were insufficient and did not consistently achieve value for money outcomes, nor adhere to State Supply Commission requirements. Through the WA Health Strategic Procurement Program significant improvements have now been made in relation to procurement across the WA health system.

3 Health Services Act 2016 s 26.

4

The Office of the Chief Procurement Officer (OCPO) was established in January 2014 to drive greater rigour in procurement arrangements, target potential savings through improvements in purchasing across the system, and oversee professional and effective procurement planning, policies and procedures across the WA public health system.

The WA Health Strategic Procurement Program developed by the OCPO contained 24 recommendations for improving procurement performance across the WA health system. The program was focused on achieving better health outcomes for the Western Australian community through the efficient procurement of health-related goods and services in a manner that complies with legislation, achieves value for money and upholds the principals of transparency and accountability. The WA Health Strategic Procurement Program has now entered its third phase.

The WA Health Strategic Procurement Program has addressed systemic issues in WA health system procurement by:

establishing processes and procedures to build capability and capacity for an effective procurement function across the statewide Health portfolio including templates, procurement guides and effective practices and practitioners;

managing a governance and compliance framework that provides mechanisms, processes and procedures and clearly defined roles and responsibilities aligned with business needs to effectively manage procurement risks;

developing and delivering foundational and advanced procurement and project management education and training programs to support procurement activities tailored to the specific needs of the WA health system; and

developing an effective compliance and audit service to review procurement processes and provide tailored recommendations for improvement in order to underpin procurement reform and cultural change.

By mid-2015 all 24 recommendations were implemented and had transitioned into core business including:

release of the WA Health Procurement Delegation Schedule and Procurement Delegation Schedule Business Rules which provides a simple, easy-to-follow set of requirements with clear accountability and governance for funding and procurement decision-making and authorisation ensuring the WA health system compliant with the Partial Exemption issued under the State Supply Commission Act 1991 (WA). These delegations are now included in each Health Service Providers delegations schedules;

provision of customised procurement education and training workshops rolled out across the WA health system;

the implementation of an electronic, mandated Procurement Development and Management System (PDMS) which will provide visibility of all contracts and spend across the WA health system. At the strategic level, the PDMS will provide oversight of procurement spend across the WA Health system, and at an individual level, will provide users with a step by step approach to contract development and management, assisting to improve these practices across the WA Health system;

permanently funded and supported Clinical Procurement positions to bridge the gap between procurement professionals and clinicians purchasing clinical equipment and improve the mechanism for clinical engagement in procurement across the WA health system;

a procurement policy to improve the consistency of processes associated with purchasing minor building works and maintenance, addressing long-standing historical legal issues across two government departments regarding works procurement; and

5

a procurement competency framework for WA health system employees which identifies the key skills and abilities required by procurement and contract management staff at all levels. This framework is an essential component of improving organisational and individual procurement capability and competency and is fundamental in delivering the objectives of the program to improve procurement knowledge, understanding and resourcing across the WA health system.

The adequacy of procurement processes is included in the Terms of Reference of the Inquiry. The WA health system has recognised that in the past its procurement practices did not meet acceptable standards and have changed them. This change is recent and would not be identifiable in many of the projects currently under review by the Inquiry.

2.2.1. Contract Management

Over the past 10 years a number of reviews and audits conducted by the Office of the Auditor General have determined:

contracts within the WA health system were generally not well managed leaving the WA health system exposed to significant operational risk;

formal contracts were not established for substantial system support requirements;

there was minimal transparency in contract decision making;

poor record keeping practices; and

inadequate monitoring and control of controls extending to financial management.

If a contract is well planned, drafted and managed, variations to the contract are likely to be minimal. However, as outlined above, in the past strong contract management throughout the WA health system has not always been present. For example, as outlined in the Office of the Auditor General – Health Department’s Procurement and Management of its Centralised Computing Services Contract – Report 1, February 2016 the WA health system had 79 variations to one contract which led to the total contract almost tripling in value in the first four years. Since that time the WA health system has made major changes, investing resources to strengthen its procurement and governance processes. The finding caused the WA health system to focus on the importance of contract management vigilance and adherence to procurement delegations. The tools, education, processes and policies recently developed by the OCPO and the Project Management Office now assist and guide all staff in procurement activities. The WA health system has emphasised to managers that procurement and contract management is a highly skilled area and should not be viewed as an area where staff who lack appropriate qualifications, understanding of requirements of their obligations as a public servant, or familiarity with contractual obligations, can be placed. This renewed focus on contract management helps to ensure that contracts entered into by the WA health system achieve their purpose and are managed appropriately.

2.2.2. Procurement of Public Private Partnerships (PPP)

A PPP is a joint arrangement between the public and private sectors for the provision of an asset or service. The objective of a PPP is to motivate the private proponent to deliver value for money over the length of the contract. The WA Government has been exploring privatisation of contracted out service options within Western Australia for at least 20 years; this includes opportunities for PPP arrangements. The WA health system continues to explore PPP arrangements where opportunities for efficiencies can be achieved without compromising the safety and quality of patient care. Benefits of a PPP include better value for money, risk transfer and alternative sources of upfront capital funds, greater long-term certainty of costs for budgetary purposes, improved affordability through the potential for recurrent cost savings, reduced risk to the State in asset delivery and the provision of an accountability framework through financially enforceable contracts to ensure services are provided to defined standards. The WA health system acknowledges that there are potential disadvantages to PPPs including that sophisticated contract

6

management is required to ensure the State gets the best value for money, that there may be reduced flexibility in health service provision, and that older PPPs may not have robust or contemporary performance management and assurance requirements or the mechanisms to be easily modernised.

Over the period of time that the WA health system has been utilising PPPs the methodology for procuring and implementing these arrangements has significantly improved with lessons learnt from previous models and projects implemented at every opportunity. These projects have resulted in more efficient and effective use of capital through co-location and sharing, additionally they utilise a more efficient design. Services are provided at less cost than the public sector rate, including base agreements and volume discounts.

Additionally, there is a greater emphasis on quality and performance – providers are abated for not meeting Key Performance Indicators (KPIs). For example older PPPs such as Joondalup and Peel Health Campuses, whilst well established and providing quality services, are not underpinned by contemporary commercial contracts, such as Midland Health Campus and Fiona Stanley Hospital Facilities Management Services. These modern contracts have defined KPIs, abatements, robust contract reporting and defined discounts from State prices.

2.2.2.1. The Midland Public Hospital Project PPP

The Project Summary of the Midland Public Hospital Project provides a clear overview of the Design, Build, Operate and Maintain (DBOM) PPP model and anticipated or realised benefits of the project. Through the DBOM model the private sector operates the facilities in addition to the provision of design, construction and maintenance roles. Aside from standard benefits associated with one entity being responsible for all aspects of the project, such as: greater incentive for design efficiencies and innovation, the elimination of potential conflicts between parties responsible for each role, and transfer of risk associated with ongoing capital lifecycle costs, the DBOM model in this particular case allowed the State to contract for high quality clinical services at a pre-agreed price, and for the Operator to build a collocated private hospital on site which can provide better outcomes for the State and patients in several ways, including:

efficiencies in designing and constructing the private and public facilities together;

the opportunity to develop economies of scale across the entire campus that will provide greater value for money outcomes for the Operator and the State;

attraction of medical specialists to the area;

patients being given the option of being treated as either a public or private patient and increases the range of services provided; and

increased the incentive for the Operator to provide better operating outcomes at the public health campus because there will be a flow on impact on the private operations.

Contracting with St John of God Midland Health Campus for the project represents a $1.3 Billion net present cost saving against the Public Sector Comparator (PSC) for the base case scenario and a $1.9 Billion saving against the PSC for the expansion scenario. This saving was driven by:

a competitive construction cost, whereby St John of God Midland Health Campus’ capital build represents significant savings over the State cost of delivery. Amongst other aspects of the project, this saving is driven by the sharing of infrastructure with the St John of God Health Care Inc funded integrated private hospital; and

St John of God Midland Health Campus offering discounts on the State’s cost of delivering the services of between 3.3% and 15%.

7

3. Project Governance and Management

Between 2007 and 30 April 2014, 28 Gateway reviews were undertaken for 13 WA health system projects. The Gateway reviews raised 314 recommendations to improve project delivery performance. Regardless of the type of project (e.g. infrastructure or ICT) four common areas for improvement emerged across the group of projects referred for a Gateway review:

project management processes;

risk management;

project outcomes; and

project governance.

In addition to these recommendations, learnings from major Health projects including the commissioning of Fiona Stanley Hospital and the Datacentres project have been identified by the WA health system and used to improve the project delivery performance across the WA health system. In the past four years the WA health system have focused on enhancing project governance and project management capabilities specifically in regards to ICT project management through new ICT governance arrangements, and more generally through the implementation of a Project Management Office and adopting a system-wide project management methodology. These improvements in project governance will ensure that the WA health system’s project delivery performance is improved, however these benefits will yet to have been realised in the projects under review by the Inquiry.

3.1. OCPO (Project Support)

In the past standard governance processes for project management were not utilised across the WA health system. In November 2014 the PRINCE2 project management methodology was adopted as standard across the WA health system. The OCPO has since facilitated training in the PRINCE2 methodology for over 500 staff. In addition to this upskilling of the WA health system’s staff, the Project Management Office (situated in Health Support Services) now provides templates and direction for projects within the WA health system to ensure consistency and project rigour. Learnings from significant projects, such as the Datacentres project, have caused the WA health system to recognise the importance of developing robust business cases. Refining business case development has been a key focus of the Project Management Office since its initiation.

As the Program Management Office was established after the eight Health projects the Inquiry is examining were initiated, the benefits from this initiative would yet to have been realised, however, when similar projects are undertaken into the future it is anticipated that the WA health system’s capability to manage projects will have significantly increased.

3.2. ICT Projects – Project Management

A whole of health ICT governance structure has been in place since April 2014. It outlines the decision-making framework and clarifies the expected roles, responsibilities and accountability of all parties involved in the planning and delivery of ICT programs and projects. Aligned to the PRINCE2 methodology, the ICT governance arrangements are a tiered structure with detailed project reporting and issue resolution addressed at the Project Board level. Those issues beyond this delegation or that involve unresolved, conflicting objectives are referred to the ICT Program Committee for discussion. The ICT Program Committee reviews and makes recommendations to the ICT Executive Board. The ICT Executive Board is the ultimate decision making body that provides strategic direction for ICT investment and oversees the implementation of the ICT Strategy.

8

Figure 1: ICT Governance

3.3. Fiona Stanley Hospital Project Governance

In 2004 the Reid Report recommended the construction of a new tertiary hospital south of Perth. The Fiona Stanley Hospital Business Case was developed in 2007 and approved by Government in early 2008. Later, funding from the Federal Government (in 2009) supported the establishment of the 140-bed State Rehabilitation Service on the Fiona Stanley Hospital site. The construction of Fiona Stanley Hospital was the largest single infrastructure project undertaken in WA at a cost of approximately $2 billion. The construction and commissioning of Fiona Stanley Hospital was extremely complex, requiring expert project planning and governance to deliver a world class tertiary/quarternay health facility. In November 2012 the Fiona Stanley Hospital project was behind, opening timelines were identified as unrealistic, and there was a focus on infrastructure rather than the complex task of clinical commissioning and transition. Improved arrangements were introduced in late 2012, a commissioning Chief Executive was appointed along with a commissioning team with clear and dedicated leadership. This was to ensure patient safety and staff care were prioritised and the project was delivered in an appropriate timeframe.

Changes implemented included the following:

governance changes including establishment of clinical commissioning groups which related directly to key workstreams – clinical, transition, workforce, ICT, corporate, facilities management and infrastructure;

establishment of Fiona Stanley Hospital’s own ICT delivery team to concentrate on specific ICT delivery, interface with Serco’s main ICT provider and liaison with the then Health Information Network, with a specific focus on locking down the scope of new ICT systems at Fiona Stanley Hospital. Fiona Stanley Hospital was the first hospital to introduce a digital medical record, ICU clinical information system, and pharmacy automation as well as other

9

core systems and thus needed specific oversight to make sure these were delivered safely and the workforce of 5000 staff were inducted in these systems;

particular focus by the senior leadership team on the Facilities Management contract, with a focus on delivery of services, contract management and resolution of contractual issues that were impeding progress on both Serco and State areas of responsibility;

establishment of responsible leads for the differing workstreams, robust project reporting, clarity of commissioning and future operating budget, and recruitment of skilled teams for what was a large and complex project;

active clinical engagement with specialty craft groups to deliver contemporary department service plans;

project reporting rigour via the PRINCE2 methodology and establishment of a project management office;

confirmation that opening would be safe (and not full opening over a few days as was planned prior to November 2012) and phased over five months due to the size and complexity of the project, and the fact that two other hospitals were changing significantly and not just transferring all services (Royal Perth Hospital & Fremantle Hospital); this was underpinned by a rigorous “Go-No Go process” which included multiple inter-related readiness assessments; and

a greater role assumed by the Fiona Stanley Commissioning and Major Hospitals Transition Taskforce, regular attendance of representatives from the Office of the Minister for Health at Taskforce meetings and regular status reports provided by the Acting Director General to the Minister for Health all contributed to faster identification and resolution of transition issues.

The Education and Health Standing Committee’s report Managing the transition? The report of the inquiry into the transition and operation of services at Fiona Stanley Hospital noted that in early stages of the project there was an absence of rigorous governance in the management of the commissioning of Fiona Stanley Hospital. However, for the most part, the Committee were satisfied that the improvements in 2013 provided the level of governance required for such a complex project.

3.4. Perth Children’s Hospital Project Governance

Perth Children’s Hospital is being commissioned within a dual governance model that is cognisant of the different responsibilities of the Departments of Treasury and Health in the delivery of infrastructure and clinical commissioning respectively. The recent achievement of Practical Completion has highlighted the importance of addressing the oversight and governance of the Perth Children’s Hospital project at this time. The Perth Children’s Hospital Commissioning and Transition Taskforce (Taskforce) has continued to monitor and oversee the delivery of program activities and milestones in both the construction and clinical commissioning aspects of the program.

On 18 May 2017 the Government released documents relating to the advice it received between September 2016 and April 2017 on the issue of lead levels in Perth Children’s Hospital’s potable water exceeding the Australian Drinking Water Guidelines maximum acceptable concentration guideline. These documents are extensive, and include a copy of the Project Overview and Status Update in relation the Perth Children’s Hospital Commissioning and Transition provided to the Minister for Health by the Department of Health as part of his incoming briefing. The document outlined that a number of issues have emerged over the project, arising from the current governance arrangements, including, but not limited to:

multiple and often disconnected reporting programmes, making effective management and risk mitigation challenging for Taskforce;

10

ensuring effective and robust clinical engagement and decision making on construction issues (such as design) critical to the ongoing functionality of the hospital;

confusion with regards to the role of Chair of Taskforce in reporting to the Minister for Health and Cabinet, and the role of Strategic Projects (SP&AS), Treasury in its direct line of accountability to the Treasurer;

lack of clarity of officers in the Department of Health, Child and Adolescent Health Service and SP&AS with regards to governance and reporting requirements, resulting in potential gaps in reporting to Taskforce.

It is vital that there is an increased focus on the clinical commissioning of the facility, with appropriate recognition of the Minister for Health’s accountability for this aspect of the program. In recent months it has become increasingly apparent that the current governance must now better reflect the challenges of commissioning and transition. This however must not underestimate the major ongoing issues related to construction such as potable water resolution, design change request finalisation, defects resolution, documentation, and FFE & medical equipment contract clarity. Changes to this governance model will provide better focus within the health system on commissioning activities, improve management efficiency by reducing meetings and formal reporting requirements, strengthen the appropriate accountabilities and streamline decision-making in this critical period leading up to the opening of Perth Children’s Hospital.

3.5. Consistent use of Gateway reviews

External reviews have identified that the WA health system’s use of Gateway reviews in the past have been inconsistent. However, the WA health system recognises the importance and benefits of Gateway reviews in ensuring quality project delivery. The WA health system is committed to using Gateway reviews at all appropriate opportunities to ensure its projects succeed on time, on budget and with the intended benefits realised. A specific example of the WA health system’s commitment to Gateway reviews is its use of the reviews throughout the Perth Children’s Hospital project. These reviews have helped to ensure project rigour and that guidance on specific aspects of project delivery is provided where necessary. The Department of Health recently hosted a Gateway Review Symposium to educate its staff about the Gateway review process and how it is used within the WA health system. This ongoing education will ensure staff are aware of the benefits of Gateway reviews and demonstrates the WA health system’s commitment to the Gateway review process.

4. ICT Governance

ICT is complex and often costly, but new and emerging technologies offer significant opportunities to improve our services, increase efficiencies, and free up resources to focus on patient and whole of community health outcomes. The WA health system has addressed many challenges related to ICT projects and procurement over recent years and have succeeded in delivering some innovative and contemporary ICT services which have improved our services. The WA Health Information and Communications Technology (ICT) Strategy 2015 – 2018 is a short-term strategy specifically designed to help the WA health system stabilise existing systems, bring infrastructure up to a minimum standard, improve the way we share information and build a strong foundation for the future. It provides the framework for ICT decision making but does not dictate the systems and applications the WA health system will use or how ICT will be delivered. This means that the WA health system can remain agile and flexible and take advantage of available new technologies.

The WA health system has recognised several challenges faced in ICT governance including:

the lack of an agreed, agency-wide governance structure and methodology for prioritising ICT investment decisions;

poor record of project, financial and contract management in relation to investment in ICT (although improvements have been noted in recent years); and

a tight fiscal environment which limits future investment in ICT.

11

To address these challenges the WA health system has expended significant effort and rigour to address previous weaknesses in the governance and management of ICT. This includes:

a centralised approach to ICT investment and decision making;

the implementation of a new ICT governance structure; and

the creation of a WA Health ICT Executive Board.

The new whole of health ICT governance structure (in place since April 2014) is enforced through the ICT Policy Framework that was mandated from 1 July 20164. The Framework specifies the ICT governance and policy requirements that all Health Service Providers must comply with in order to ensure effective and consistent ICT governance, decision making and use of systems across the WA health system.

This approach will ensure decisions about ICT are business-led and appropriately support the achievement of WA health system’s strategic and business objectives. The new arrangements will also ensure rigorous project management and reporting arrangements are in place for all ICT projects. The Executive Board, which is chaired by the Director General and includes Chief Executives of all health service providers, is responsible for approving all ICT business cases. Despite the implementation of the devolved governance model the centralised ICT governance structure has remained in place. Other key changes that will support the successful delivery of ICT projects, include:

the establishment of the role of Chief Procurement Officer in January 2014 with oversight for ensuring appropriate policies, procedures, audit and assurance processes are in place across the WA health system are consistent with legislative and government policy requirements;

progressing key appointments, including the Chief Executive of Health Support Services; and

establishing procurement training and education program across the WA health system.

The WA health system’s mission for ICT includes bringing the WA health system’s ICT infrastructure up to contemporary standards, stabilising existing systems, establishing and maintaining a Standard Operating Environment and ensuring ICT decision making, development and project delivery supports the WA health system’s core business. Implementation of the new, rigorous ICT governance arrangements will ensure ICT projects and procurement are undertaken efficiently and effectively as the WA health system strives to achieve this mission.

5. Conclusion

The Inquiry comes at a significant point in the reform program being implemented across the WA public hospital and health system. The recent reviews, reports and recommendations by external agencies have informed and improved our practice. Similarly, the internal initiatives in the form of the WA Health Reform Program 2015 – 2020 have prompted significant improvements and change that are and will enable all areas of the WA health system to perform better. In some circumstances the reforms are still being “bedded down” and others we would hope are now seen as best practice examples for other agencies.

The findings from the Inquiry will be viewed as either validation of the reforms we have already put in place or the opportunity to improve our governance and decision making processes further.

4 Health Services Act 2016 s 26.