Joan Burton (Dublin West, Labour)
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Question 180: To ask the Tánaiste and Minister for Health and Children the safeguards that have been instituted in view of the issues raised over the iSoft Project in relation to contracts such as these to protect public interest against waste; the steps she is taking to ensure value for money; and if she will make a statement on the matter. [35458/05]

Mary Harney (Dublin Mid West, Progressive Democrats)
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The Government recently introduced initiatives to ensure major capital projects, including ICT enabled change programmes, delivered value for money and were completed within budget, scope and timelines.

A peer review process of major ICT projects will be undertaken by the Department of Finance's CMOD. All major ICT projects currently under way within the HSE will be subjected to this process.

In early October, the Secretary General of my Department wrote to the CEO of the HSE setting out a number of governance principles which, I understand, are being adopted by the HSE. These new governance arrangements within the HSE will ensure that there is one central source of decision-making on implementing ICT strategies, plans and projects. In future, there will be one central management point under the control of the HSE's national director of ICT for all purchases of hardware, software, telecommunications, ICT development or advisory services, including all hiring decisions concerning ICT contractors and consultants.

The iSOFT contract covers software licences, implementation and support services over a ten-year term for an overall contract price of €56 million. The contract was negotiated with a specific focus on fixing costs to the greatest possible extent and on providing the best possible protection for the HSE in the event of poor performance by iSOFT.

While the HSE is obliged to maintain the confidentiality of the detailed commercial terms, I have been informed that the following provisions illustrate the type of safeguards in place: 1. There is a fixed price for software licences which entitles all publicly-funded healthcare agencies in Ireland to unlimited use of the iSOFT i.EPR product suite covering a wide range of administrative and clinical support areas. No matter how extensively the software is used there will be no additional charges; 2. There is a fixed price for software maintenance and support payable over ten years, with an annual instalment payable every year. This provides for 24 x 365 cover and the price charged is well within industry norms; 3. The licence fee and support fee components are fixed for the entire term of the agreement and there will be no annual revisions for inflation or for any other reason; 4. The daily rate for implementation services, which is a very competitive rate, is fixed for an agreed volume of service days that are to be provided over the first five years, i.e. the anticipated number of service days required during the main roll-out period. In the event that any additional service days will be required the daily rates for such days is fixed for the first three years of the contract and increases thereafter are strictly limited to the rate of inflation from year 4 onwards; 5. iSOFT must use its best endeavours to transfer implementation skills to health service staff so that roll-out of the system can be as self-sufficient a process as possible; 6. There is a cap on expenses for iSOFT personnel and a range of measures have been agreed to ensure minimisation of expenses; 7. All deliverables by iSOFT are linked to financial remedies payable to the HSE in the event of missed deadlines; 8. All services by iSOFT are subject to formal quality review and stated performance levels and financial remedies are payable to the HSE in the event of inadequate performance; and 9. To protect against any non-payment by iSOFT of any remedies due, iSOFT is obliged to lodge a substantial sum of money in an escrow bank account for direct withdrawal by the HSE.

The HSE has informed me that it is satisfied that best value for money is being obtained in this case.