I will read the most salient points for the members of the committee, who all have a copy. There is a typographical error in my submission on page 8 in that "March 2008" should read "March 2007". I am sorry about that.
I welcome the opportunity afforded by this meeting to respond to the issues raised in chapter 5 of Special Report 10 of the Comptroller and Auditor General. It is important to set the context within which the Irish Blood Transfusion Service. Blood transfusion is an essential part of modern health care. Much of modern medicine could not happen without the availability of a safe and consistent blood supply. Used correctly, it can save lives and improve health. It is expensive and uses a scarce human resource.
It is generally accepted that blood collected, processed and tested by the IBTS and available for patients in this country has never been safer with respect to the risk of transmission of infectious diseases. The IBTS collects approximately 150,000 units of blood per annum and issues them to hospitals throughout the country for the essential care of patients. This is vital work for the health care system and I believe we have a blood transfusion service in this country for which we can be justly proud.
I would like to deal with the issues raised in the report under five headings: rationale for upgrading the blood bank control system, that is, Progesa; the decision to stop any further work on the project in March 2007; analysis of the budgetary issues; recommendations in the KPMG report; and the current proposals to upgrade the blood bank control system. It is important to contextualise why it was necessary to upgrade the current version of Progesa 4.4d/e, which had been implemented in March and June 2003 in Cork and Dublin, respectively. This project commenced in 1998 but due to a significant number of problems was not implemented until 2003.
However, Progesa is a very robust blood bank control system. This technology has a flat-file structure which makes it very difficult to extract effective management information in a timely manner. Therefore, when a version based on an Oracle relational database became available, it was in keeping with the IBTS software policy of implementing Oracle as the proprietary software. In addition, because of the length of time taken to implement Progesa, the IBTS was left in a situation where the hardware on which it was operating had reached the end of its life and needed to be replaced. It made good economic sense to upgrade the current blood bank control system at the same time.
A project definition document was written by IT outlining the various options available to IBTS at the time and also dealt with the various requirements for the implementation of eProgesa in the IBTS. It also gave justifications for moving to eProgesa. They are self-explanatory but I will highlight one or two. The platform to which I referred was reaching the end of its life. eProgesa offered the ability of real-time recovery tools. At the time in question, if Progesa crashed during the middle-of-day processing, the only option for the IBTS was to return the system to the previous day's backup. This was important for us. It was contended that eProgesa would allow the IBTS the opportunity to become a world leader in blood transfusion technology, and that additional functionality would allow for a more efficient blood transfusion service.
On the question of governance and oversight, information on the structure is contained in Appendix 1 to my submission. The project was not just about upgrading the software and hardware but also merging the two donor and patient file systems that existed at the time in question. This was important because we needed to have the two files on one database. It was decided to merge these files on our current system because that was the experience that MAK had. It was successfully achieved in August 2005.
Consider the significant milestones in the project. In October 2004, MAK sent an official proposal for the eProgesa project to the IBTS which was accepted by the executive steering group. In May 2005, the eProgesa project manager resigned from the Irish Blood Transfusion Service. The IT manager was appointed project manager. Certain project time lines were drawn up and a "go live" date was set for 28 October 2005. Since then, two further "go live" dates were missed due to issues and bugs not being resolved.
From this time the testing of the system showed a continuous flow of issues and bugs. It proved extremely difficult to have these issues resolved despite constant telephone conferences, letters to MAK-System, the board writing to MAK-System and visits to Paris by Irish Blood Transfusion Service personnel and return visits by MAK-System personnel to Dublin. Despite all these initiatives, in September 2006 the executive steering group had become very concerned that no definite "go live" date could be identified and requested the IT manager to develop an options appraisal document setting out the options available to the organisation.
The executive steering group examined the options and decided, due primarily to the lack of viable alternatives, that the Irish Blood Transfusion Service should proceed with the implementation of eProgesa. However, it was also agreed that investment would be made on the printers and maintenance of the alpha servers as these were critical to the continued operation of the current system.
On 20 March 2007 the executive steering group met to discuss the project. The IT manager reported the system was unstable and the super-users had lost confidence in it; a fix to one issue was causing problems in an unrelated area which would indicate that the patch was not being tested properly before being shipped to the Irish Blood Transfusion Service; the number of issues outstanding was not reducing with no indication from MAK-System when they would be resolved; and other countries who were implementing eProgesa had lost time.
Consequently, the executive steering group requested the project manager to examine the option of stabilising our current system and also how the Irish Blood Transfusion Service might move to version 4.4G and set aside eProgesa for the foreseeable future. It was agreed the executive steering group would meet again on 26 March to make the final decision on the future direction of this project. The other factor to be considered was the impact not implementing eProgesa was having on other projects.
The executive steering group decided to defer the eProgesa project and not return to it until the system had been implemented in other countries. It decided to stabilise the current system and examine the feasibility of including improvements to facilitate the streamlining of work in the components laboratory.
This decision was taken because of the need to secure the current system to ensure continued service delivery. The response from MAK-System was inconsistent and could not be relied upon. Super-users did not have confidence in the system as solutions to fixes were impacting in an area that was separate from the fix being implemented. Performance of system in one blood service centre was still slow and the level of performance would not be acceptable to the Irish Blood Transfusion Service. There were two versions of eProgesa in development and this was never intended. The Irish Blood Transfusion Service had been unable to get below 30 issues or bugs outstanding despite extensive testing and follow-up. There was constant disagreement by MAK-System on the number of issues and bugs outstanding and whose responsibility it was to fix them. This was still the case on 26 March 2007 when the decision was made to stop work on the project.
When the implementation of eProgesa was discontinued, the project was within budget. The total budget allocated to the project in 2004 was €3.13 million. The amount spent to March 2007 was €1,887,625. However, a significant amount of this expenditure has been utilised with much of the hardware purchased being used. The laptops, printers and wireless equipment purchased for eProgesa are in use on our mobile collection clinics. Professional fees on server set-up of €5,644 was capitalised as a legitimate part of server costs. Regarding the cost of €465,787 for Oracle licences, these have been used in several projects that were planned and require Oracle licences such as electronic quality management system, BOSS, e-financials, rondo, electronic management of accounts payable and the upgrade of CORE, the human resources system. The amount to be written off comes to €729,336.
In accordance with FRS 15, the Irish Blood Transfusion Service charge staff costs directly attributable to bringing the asset into working condition for its intended use, up to the point of the system going live. That cost is then capitalised once the equipment or software system is live and delivering value for the organisation. This practice was followed for the eProgesa project and hence the write-off as the project was discontinued. It is important to point out that the staff costs would have been incurred in any event but there was an opportunity cost.
When the Irish Blood Transfusion Service discontinued work on this project, it decided an external review of the project should be undertaken and quotations were sought from three companies. KPMG was appointed to undertake this review. The report made four key recommendations on IT strategy and planning, information systems environment and supporting technology, dependence on MAK-System and project management.
The Irish Blood Transfusion Service's strategic plan 2005 — 2009 sets out the direction that the organisation is taking. The plan is based on four pillars — adapting to changing business environment; quality; technology and research and organisation development. While IT developments are dealt with under the third pillar, there is not a specific IT strategy. However, since this report was finalised, an ICT council has been established with defined terms of reference and membership. It is in the process of developing an ICT strategy, scheduled to be completed by the first quarter of 2009.
MAK-System is the foremost supplier of blood bank control systems to transfusion services across the world. The Progesa system is in operation in Europe, USA, Canada, Australia, New Zealand and Asia. When the Irish Blood Transfusion Service initially purchased Progesa it followed a full tender process and there was only one other supplier short-listed for consideration. Senior staff of the Irish Blood Transfusion Service regularly attend conferences and scientific meetings where suppliers of all major systems and equipment for use in blood transfusion services exhibit. In addition, the national blood services in Europe have formed an association that meets biannually where all areas of activity are discussed.
There was no evidence at either of these fora that an appropriate alternative system to Progesa had come to market. Therefore, it was a reasonable course of action not to go through a formal tender process when the decision was taken to upgrade to eProgesa. In fact during this time one European blood service had carried out a benchmarking exercise to examine all possible systems available or that could be customised to provide a blood bank control system and decided to purchase eProgesa.
When the Irish Blood Transfusion Service cancelled the eProgesa project, it evaluated the only other major supplier on the market and concluded, following a presentation and site visit, that the system on offer was not as robust as the version of Progesa operated by the Irish Blood Transfusion Service. It was estimated that it would be approximately three years before that company would have a system that would be worth considering. Consequently, it is unclear if any benefit would have been gained from a full tendering process and subsequent events have borne this out.
The Irish Blood Transfusion Service accepts that there was not an off-the-shelf project management methodology in use for the eProgesa project. However, there was a governance structure in place which operates for each project. The Irish Blood Transfusion Service is a learning organisation. When the Progesa stabilisation project commenced, the PRINCE 2 methodology was used pending the development of an appropriate methodology. The Irish Blood Transfusion Service has developed a project management framework and work is ongoing to develop a set of tools to underpin this framework. Once completed, this will be the project management methodology used for all projects in the Irish Blood Transfusion Service.
The Irish Blood Transfusion Service has stabilised the current version of Progesa on new hardware and there has been a significant improvement in the operation of the system. However, the need to upgrade still exists and the Irish Blood Transfusion Service has decided to carry out a feasibility study of all the options available prior to proceeding to a full tender process. This exercise will be undertaken in 2009. A decision will then be taken on the appropriate system to deliver enhanced functionality while losing none of the robustness and security of the current system.
The Irish Blood Transfusion Service is very conscious of the important role it plays in delivering health care here. This is only achieved through the loyal support of our donors and the professionalism of our staff. As we enter a difficult period for collecting donations I ask that donors and members of the public come forward and support the Irish Blood Transfusion Service so we can ensure patients in hospitals will have blood available for them over the coming months.
With regard to chapter 5 of the Comptroller and Auditor General's report, I assure the committee that the Irish Blood Transfusion Service is very conscious of the need to provide value for money for the funds provided by the State. The organisation is currently implementing a major change programme designed to deliver improved services to our patients and donors in a more cost effective manner. Substantial progress has already been made in this programme. The Irish Blood Transfusion Service operates in a very uncertain environment where emerging threats are ever present. The Irish Blood Transfusion Service must be in a position to respond to these threats by having the appropriate resources and skill sets. The public would expect nothing less.