Birmingham City Council seeks £46.5m to fix IT system

A spend of £46.53m is set to be approved to fix problems with a new Birmingham City Council IT system affecting payments, data management and background checks.

The Oracle system was brought in to overhaul internal functions including payments and HR processes.

According to a new council report, the authority was meant to change such processes to fit Oracle's requirements.

Instead another approach was taken and the problems emerged.

The report on the proposed spend said that rather than adopting Oracle as it was, officers instead sought to customise the system, bending it to the existing way the council conducted business.

Such a shift - which was contrary to a plan approved in 2021 - had "severely impacted upon the council's ability to properly implement Oracle", the council said.

It is estimated the final cost to put things right will be in the region of £100m, with the report requesting £46.53m this year to fund.

Previously, the new leader of the authority, John Cotton, said the council would not use money earmarked for other services to cover the bill, adding officers must be held to account.

The council said: "The full extent of the issues was only uncovered by senior officers and councillors in April of this year and means some critical elements of the system are not functioning adequately and this has impacted primarily upon the day-to-day operations of Finance and HR."

Difficulties have included a "significant number" of financial transactions having to be manually allocated, creating a backlog; in turn harming the council's ability to "close" its accounts for the year 2022/23.

Problems have affected customers, with one school being visited by bailiffs.

In HR, there have been issues relating to recruitment, data management, and processes to update renewals of Disclosure and Barring Service (DBS) checks.

The council has been contacted for comment on the nature of the DBS issues and the ways in which practice may have been compromised.

The council said it was working with external auditors to close its accounts by the end of August.

"An independent management review will explore why the issues took so long to emerge," the council added.

Cabinet member for finance and resources Brigid Jones said it was "never easy when implementing a new IT system" for an organisation of the council's scale.

But Ms Jones added she was "determined" the authority would "learn from this".

She said: "Most important of all right now is the need to work at pace to resolve the issues we are facing and to be open and transparent about what they are."

Ms Jones stated the focus of the council leadership on this would be "relentless in the weeks and months ahead".

She said: "Through this report, we detail what needs to be done and the plan for how to fund this, giving us a way forward to ensure effective and efficient systems and processes are in place as soon as possible."

Plans to solve the problems would need to reach into March of next year, the council said.

The report will be presented at a cabinet meeting on 27 June.

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