‘Part privatisation’ of VicRoads tech system criticised

Denham Sadler
National Affairs Editor

The Victorian government’s decision to “part-privatise” key elements of VicRoads has been criticised by the services union, which called on the plan to be scrapped and the tech work brought in-house.

Treasurer Tim Pallas said last week the state had made an in-principle decision to pursue a “joint-venture model” for some of VicRoads main functions, including registration, licensing and custom plates. This would involve a private company being brought in to rebuild and run the troubled IT systems for up to the next 40 years.

The contract would likely run for up to 40 years, and seems likely to be inked with a partnership between a super fund and a tech provider.

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It would be the first time that an Australian jurisdiction has partnered with the private sector to perform this key function and has raised significant concern in the public sector union.

The Australian Services Union has slammed the plan, saying it would put jobs and wages at risk, and is something the Victorian government must be able to deliver in-house.

Mr Pallas pointed to a scoping study that found this model was the “best way to develop modern registration and licencing services” and said the government would retain ownership of all data, and the “vital functions” of pricing, road access and safety.

“We’re going to put in place a joint venture partnership with the private sector to ensure that we get a modernised, adaptable service,” Mr Pallas told the media.

“This is not privatisation, it’s effectively a partnership that hopefully will work for the Victorian people, and hopefully them the IT system they deserve.”

“The private sector is much better at delivering these tools. They are also much better at being responsive to customer needs.”

The government will now begin the search for the private company to undertake the significant and lucrative job, with a contract expected to be signed by the end of the year.

The Australian Services Union has raised significant concerns with the plan.

“The Victorian government needs to be able to deliver the IT solutions and other tools needed by VicRoads workers without part-privatisation of this essential government agency,” Australian Services Union secretary Leon Wiegard told InnovationAus.

“The Victorian government can get the best of private sector innovation without transferring any control of VicRoads operations to a private entity. Across the Victorian government, significant investment in the tools needed to deliver services to the public happens every day without going down a risky path of part-privatising government operations.”

Mr Wiegard said the union is also worried about job losses and an impact on wages.

“With any privatisation, despite any prior commitments, wages and conditions fall over time. And for VicRoads workers the only protection against this would be continued public sector employment,” he said.

Mr Pallas said there will be “stringent parameters and principles” in place to guide the development of the IT system, and that all current VicRoads staff will be retained.

“We are focused on delivering a better customer service experience for motorists, and protecting jobs for VicRoads workers,” he said.

“VicRoads employees provide an incredibly important service for the Victorian community, and we will ensure these workers and their entitlements are protected throughout this process.”

It’s not the first time the state government has looked to revamp the VicRoads registration and licensing system, with the RandL project scrapped in 2015 at a loss of $97 million. The project was troubled from the start after first being discussed in 2008 as a way to replace the legacy systems used by the agency for these processes.

The move is also in stark contrast to the approach of the NSW government, which has moved its registration and licencing responsibilities to Service NSW, and recently launched digital versions of drivers’ licences.

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