The Welsh government needs to improve its ability to articulate and deliver the financial benefits of IT projects, a report by the Wales Audit Office has found.

The report investigated the Welsh government’s ten-year IT services partnership with Siemens IT Solutions and Services (now part of Atos), named Merlin, which it signed in 2004. It concluded that the partnership has improved significantly since 2006, when it was found to lack "the most basic level of programme management and control’.

"Core ICT services provided under the contract have improved, as has the relationship between the Welsh government and the supplier," it discovered. 

For example, the number of service credits that Siemens had to give the Welsh government as compensation for outages or IT failures has fallen from over 500 in 2005-2006 to fewer than 100 in the last year.

However, it also discovered ongoing shortcomings in the Welsh goverment’s ability to realise the benefits of IT projects delivering under the contract.

"One of the main aims of the Contract was to use ICT to enable business change through a series of projects," it reads. "While projects have brought some benefits, their value for money is uncertain because a systematic approach to benefits realisation for ICT projects has not been embedded"

To remedy this, the report recommends that the Welsh government should develop a system for planning, measuring and monitoring the financial and non-financial benefits of IT projects, and require "senior responsible owners" to report on the benefits being delivered annually.

"Benefits realisation should be an ongoing process that begins at an early stage of any programme or project," the report asserts. "Programme and project managers must be clear about what they are trying to achieve and the expected benefits of achieving it, and put in place measures to assess the benefits that have been realised."