ARMS Ltd project underwent changes during tendering process – AG

The Auditor General has tonight presented the conclusions of a report – commissioned by the House - investigating the setting up and staffing of ARMS Ltd, the level of service delivery offered to its clients and other issues which affected the taxpayer.

The report found that the nature of the project underwent a change during the tendering process: "Operations were decoupled from the original Business Process Outsourcing model requested."

The AG also noted that ARMS Ltd. lacks three key dedicated functions: Customer Care, Human Resource Management and Revenue Assurance. “In view of its extensive customer-base and the continuous contact with its clients, the Company should look into this matter,” the AG recommended.

The National Audit Office had also requested ARMS Ltd. for categorised customer complaints lists but the level of analysis requested was unavailable.

The AG said that the company is also facing difficulties clearing problematic accounts which do not get invoiced.

“A considerable number of accounts were locked and were not having bills issued. This is one critical area where ARMS Ltd. has continuously failed to ensure success. Despite various efforts over a number of months, the quantity of locked accounts remains high.”

“Although the company is making use of performance indicators to gauge its output, the indicators deployed merit revisiting to depict a more holistic and truer picture of operations,” the report said.

Despite that the project deploys state of the art software and hardware solutions, by themselves these are no guarantee of success, the AG said: “Data input needs to be up to scratch to enable meaningful and useful output.  A case in point is the chronic deficiency in ARMS Ltd. analysis of customer contacts.”

Referring to the problems the company faced during 2010, the AG found that these resulted from critical deficiencies in data quality checks prior to migration and a breakdown in data matching controls in two major modules.

The NAO said that it acknowledged the progress registered since the change-over to the new system. “However, any material return on the very significant investment made can only be obtained once smart metering is implemented,” it said. “ARMS Ltd. also needs to address these deficiencies to ensure a tangible improvement in performance.”

The Auditor General however remarked that, while public focus fell on ARMS Ltd., the scenario is much wider adding that ARMS Ltd. was the agency set up by the Corporations to manage the meter-to-cash function.

“It is the implementation of a mega-project involving both Enemalta Corporation and Water Services Corporation. The project included replacement of core business software, a nation-wide changeover to smart meters and the acquisition and deployment of various other technological aids meant to help modernise the Corporations.

In the report, the AG said that despite the take-over by ARMS Ltd. and the implementation of the new, state of the art systems, no significant changes to the meter reading process have been registered.  “The system is still based on a mix of provisional estimates and manual meter readings and can only change drastically - for the better - with the widespread implementation of smart metering.”