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Friday Aug 31, 2012

Expert encourages Durban's billing system

The eThekwini Municipality should continue with the controversial multimillion-rand Revenue Management System (RMS), despite a number of red-flags in a report tabled before executive committee members by an IT specialist.

Leepy Shabangu, owner of a consulting firm, Advisory IT, advised the city yesterday to continue with the eight-year old project because the city had already poured about R500m into the system and it was near completion.

With 800 000 customers, the city collects more than R20 billion in revenue. Shabangu was roped in at a cost of R900 000 by the city two months ago to probe the long- awaited system

"I would choose to continue with the RMS but I would let the developers know that if they slip by just a fraction, that I won't pay them."

The R474-million system, originally set to cost R150m, has been a contentious issue with councillors and city officials because of constant delays in its go-live date.

Shabangu said a further R270m would be required to complete the current project. He added that R62m had already been spent on maintaining and supporting the system.

The city was also negotiating a three-year maintenance and support agreement which is estimated at R165m.

He expressed his concern at the lack of adequate skills available locally to support the system, as there was a heavy reliance on offshore development and support.

On data migration, he said there was limited cleansing and testing done.

He also expressed his concern about the lack of a change management, which he said was required for a project of such complexity.

"A project of this size requires focused and on-going management of the change. The risk is significant loss of trust and momentum and survey results already show a high level of negativity towards the project and a lack of confidence in the system," he said.

He tabled three options for the city to consider as a way forward: drop RMS and continue with the current coins system; Install the ERP system which is currently used by Johannesburg and Cape Town; or continue with RMS as planned.

He said while the coins system was the cheapest for service delivery, he warned that it would inevitably cost the city more.

The second option was viable, but it could be extremely expensive, risky and would require a lot of work and time to implement it. He said annual licensing fees for the ERP system range from R50m-R150m.

Cape Town municipality paid R350m to implement ERP while Johannesburg paid R800m.

With 70 percent of the RMS project having already been completed, Shabangu said the city should continue with it.

"We know what needs to happen going forward and it is not easy to write off an asset that has cost more than R400m," he said.

"Things are not as good as we would like them to be, but they're not as terrible as people make them out to be."

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