PROOF VERSION ONLY
SELECT COMMITTEE ON TRAIN SERVICES
Inquiry into the factors leading to and causes of failures in the provision of metropolitan and V/Line train services, including the impact on those services as a result of the purchase, operation and implementation and oversight by government of the myki ticketing system in Victoria, including an examination of performance, costs and integration of the myki ticketing system
Melbourne — 23 August 2010
Members
Mr B. Atkinson Mr S. Leane Mr G. Barber Mr E. O’Donohue Mr D. Drum Mr M. Viney Ms J. Huppert
Chair: Mr B. Atkinson Deputy Chair: Mr S. Leane
Staff
Executive Officer: Mr R. Willis Research Officer: Mr S. Marshall
Witnesses
Mr G. Purdy, chief executive officer and vice-president, Keane Australia Micropayment Consortium Pty Ltd; and Mr A. Durrani, executive vice-president, Keane Asia-Pacific.
Necessary corrections to be notified to executive officer of committee
23 August 2010 Select Committee on Train Services 1 The CHAIR — I formally declare open the Legislative Council Select Committee on Train Services public hearing. Today’s hearing is in relation to the committee’s amended terms of reference of which you have been well aware — namely, the factors leading to and causes of failures in the provision of metropolitan and V/Line train services, including the impact on those services as a result of the purchased operation, implementation and oversight by government of the myki ticketing system in Victoria, including an examination of performance costs and integration of the myki ticketing system.
I extend a welcome to representatives from Keane Australia Micropayment Consortium Pty Ltd: Mr Greg Purdy, the chief executive officer and vice-president; and Mr Amir Durrani, executive vice-president, Keane Asia-Pacific. I indicate to you both that all the evidence that is taken today is protected by parliamentary privilege. However, if you were to go outside the precinct and repeat those comments — indeed repeat them to the media on the steps of Parliament or something — then you are not necessarily covered by that same privilege.
All evidence is also going to be subject to Hansard in so much that notes as a comprehensive record of today’s proceeding will be taken. You will have an opportunity to have a look at that record to make sure that we have no misspellings or key things that might be inaccurate, but obviously the substance of the record is not to be changed.
What we have done with most of the witnesses over the process is invite them to make some opening statements, and then we have proceeded to questions. On this occasion if you would like to do that as well, I would invite you to perhaps give us an introduction and overview from your point of view in respect of our terms of reference, and then we will proceed to some questions.
Mr DURRANI — Good afternoon, and thank you for inviting us to this session today. My name is Amir Durrani. I am the executive vice-president, Asia-Pacific, representing Keane. Kamco is part of my portfolio. Obviously it is a significant part of our portfolio in Asia-Pacific. Also you know that Kamco is a wholly-owned subsidiary of Keane. Keane globally has about 12 000 consultants. We are a US-headquartered organisation. Our Asia-Pacific headquarters are in Melbourne. We have around 150 consultants based locally out of Melbourne, primarily around Kamco.
We look forward to your questions. However, before that I would like to introduce Greg Purdy. He is the CEO for Kamco. I invite him to present his opening remarks.
Mr PURDY — Good afternoon, gentlemen and ladies. I am Greg Purdy. I am the CEO of Kamco, so I am responsible for the day-to-day operation of the company. Included in that responsibility is the management of the build team deploying myki and the operational team that is providing the support to the modes that are currently in revenue service, being regional bus, metropolitan rail and metropolitan bus and tram.
The myki contract was awarded to Kamco on 12 July 2005. Kamco was contracted to design, build, implement and then operate the myki system. As you are aware, under the contract Kamco is to be paid $494 million over 14 years. This includes $176 million to build the system and then around $318 million to operate the system for 10 years. So far we have been paid around $150 million. Now we are out and operating on four of the modes, as I said earlier. As recently as July we went live on tram and bus, as you know. Amir and I are happy to take your questions.
Mr BARBER — Thanks very much. The equipment and all that as they operate I get to see everyday, so I have a feel for it. I am no tech-head, as they say, but I get to see that in operation. The back-end financial and data processing side of it is obviously not visible to me. Can you explain to me what is the scale of that part of the job and what functions you are performing there, apart from the obvious thing, which is to collect some money from someone?
Mr DURRANI — I think a big piece of our processing is obviously the financial aspects, which involve the financial reconciliation on a day-to-day basis and on a monthly basis, and we are performing that in conjunction with the TTA, and sharing the results with them. So we have gone through an audit process with them. Obviously TTA owns the results of that audit — the government owns that — and we are delivering those services in conjunction with TTA.
23 August 2010 Select Committee on Train Services 2 Mr BARBER — But can you give me an idea of how many transactions that involves or how big the computer has to be or how many people you need to keep that running? How often do you have to intervene in it to keep it running? It is not just a giant automatic teller, obviously.
Mr DURRANI — No, it is not. We have a whole operations team there monitoring the system 24/7 to keep the system up and running. We are running the system. We have the data and information, but a lot of that data and information is owned by the government, and they should really be sharing a lot of that information with us. But we have a fairly elaborate operations scheme in Melbourne to monitor the system on a 24/7 basis.
Mr BARBER — I do not know what ‘fairly elaborate’ means, because I do not know anything about this sort of exercise.
Mr DURRANI — ‘Elaborate’ means to provide the customer experience that you are seeing today. When you said you go and visit the trams or buses and you are seeing the response from them, that is what the team is supporting to provide for you.
Mr LEANE — You mentioned introducing myki onto trams and buses in July, and obviously there were a few problems before introducing it onto trams and buses in July. Can you fill us in on the problems and what you had to do to overcome those problems to get to the position we are in now; and secondly, regarding the future of information flow between trams and buses and the main servers, or whatever you want to call it, at the last hearing there was talk that there might be some new technology that will improve the way you move information from the trams and buses to the system.
Mr PURDY — The system, like all large complex software systems, has had a maturity path through versions of software. What you saw occur through June then into July was a standard maintenance release of software. In June we piloted one organisation, finalised it, debugged it and then in July there was the version we sanctioned to go live upon as it was stable and met the requirements that were required.
Moving forward, like every software program it will have a release cycle where maintenance releases will be programmed over time to increase the system maturity and availability. That will be an ongoing thing that will be part of the normal program, and then we will move into the operations phase.
The enhancement you may be speaking of is fairly well known through to TTA, and that is the inclusion, commencing later next month, of a vehicle communications unit on the remote tram and bus communications. So that will enable us to get better and more timely communications from the vehicles.
Mr O’DONOHUE — When will myki be rolled out on V/Line?
Mr PURDY — We are currently working the scheduled in a staged approach with the TTA, but the TTA are the owners of when we are going to do that.
Mr O’DONOHUE — Do you anticipate that that will happen this year?
Mr PURDY — It is the TTA’s decision as to when we actually roll that out.
Mr O’DONOHUE — I appreciate that, but do you think it will happen this year?
Mr PURDY — It is the TTA’s responsibility for that schedule.
The CHAIR — If the TTA said next week, are you in a position to do it?
Mr PURDY — The program is a phased approach. The next phase will be to launch this into regional rail, which is part of V/Line.
The CHAIR — But when are you, operationally, able to do it? I understand the TTA will make the final decision, but when is your capability such that in that phased approach you would be able to deliver on that sort of direction?
23 August 2010 Select Committee on Train Services 3 Mr PURDY — The system is able to be rolled across different modes, and we have a schedule to do that. Right now the schedule has V/Line at a different point, and that point of the schedule is the responsibility of TTA.
Mr DURRANI — Just to add to that, the rollout on V/Line is not as simple as just rolling out V/Line; there are some dependencies which are in the discussions with TTA and the government. That is why I think it is not just the software solution; there are various aspects of the software solution that need to be approved and deployed for V/Line to work, and that is in play today, so that is why we keep repeating that the decision is with TTA.
Mr O’DONOHUE — I understand that, but the fundamental question to the two of you is: when will you be in a position — —
Mr DURRANI — As I said, there are dependencies associated with V/Line. Those dependencies are the various aspects involved in that dependency, including the government and TTA.
Mr O’DONOHUE — And when do you think they will be resolved?
Mr DURRANI — We are in discussions as we are having this committee meeting, so those are under way.
Mr O’DONOHUE — When do you think they will be resolved?
Mr DURRANI — Over the next few weeks.
Mr O’DONOHUE — You mentioned before the $494 million contract price to build and operate myki. Have there been any variations to that contract price since the original contract was executed?
Mr PURDY — There have been variations entered into between Kamco and the TTA.
Mr O’DONOHUE — Can you give details of those variations?
Mr PURDY — The dollar values around those variations are commercial in confidence, and the TTA owns that information.
Mr O’DONOHUE — The original go-live date for myki was back in 2007. As I understand it there were penalty provisions for failure to deliver the system on time. Have those penalty provisions been enforced?
Mr PURDY — There have been no direct penalties applied to Kamco by the TTA.
Ms HUPPERT — Obviously from what we have heard it is a very complex system, and our terms of reference talk about the interaction between this system and the operation of the system as a whole. To assist us with that I wonder if you could explain the maintenance regime you have to ensure that myki readers and machines are functioning at a high level of reliability.
Mr PURDY — We have maintenance contracts in place with maintenance providers. We look at the system from a system monitoring point of view automatically through the system; that system then issues out service requests, and those service requests are then handled by our maintenance providers.
Mr BARBER — As I understand it the balance of my account, if you like, is not actually on my card, it is on your computer; is that right?
Mr PURDY — No, the balance of your account is on your card.
Mr BARBER — It is on my card. Okay. When I touch my card, what conversation is it having with your computer to deduct the amount from the memory in my card; is that what it does?
Mr PURDY — The device reads the card. It looks at where you have travelled and applies the complex business rules on the device and then amends the value on your card.
Mr BARBER — It calculates how far I have travelled?
23 August 2010 Select Committee on Train Services 4 Mr PURDY — That is correct. It calculates where you have travelled to and where you are from.
Mr BARBER — To work out how much to deduct?
Mr PURDY — That is right.
Mr BARBER — Is there a separate system as well? If I pay for an annual ticket — sorry, I have not actually used it yet — it does not have to do that deduction; is that right?
Mr PURDY — That is right. It reads a product on the card. The card has a product rather than myki money, and it reads that product. It sees that it is a valid product, and that is it.
Mr BARBER — So you have a system that is effective for both those types of functions?
Mr PURDY — That is correct.
Mr DURRANI — The business rules around the system are fairly complex. We are more than happy to answer any questions, but I think the specifics of the business rules again have been determined by the government — by the TTA. I think they are probably the best people to answer those business rules questions: why certain fares have been charged and what those zones are and so on.
Mr BARBER — I am not questioning that. It is just really in terms of the functionality of the two different systems that you are running. One is simply to read my card and go, ‘Yes, he has already paid what he has to pay’; and the other one is to read it, calculate how far I have travelled and deduct it from the memory, which is a pretty hefty transaction to be done in the couple of microseconds that I am standing there. I presume it is the latter that generates most of the processing requirement of your system; yes?
Mr DURRANI — I think it is both. Again I do not want to get into the details of the workings. We are not the specialists around that; we have architects who can explain that to you in detail. But both the transactions are critical, because even with the first tag on it needs to recognise who you are; it needs to recognise, as you said, whether it is a plan, whether it is a concession fare or whether it is a regular fare. Then as you tag off, it calculates what the fare is and so on.
Mr BARBER — But you would agree that when I use my swipe card to get in the door that is not connected to anything. It simply reads it and goes, ‘Yes, he is who he says he is’, and the door opens. That is like the yearly card. Whereas the myki money is a bit like me putting a card into an ATM, where there is a whole set of calculations and discussions around that.
Mr DURRANI — That is correct.
Mr BARBER — It is that latter one that is much more complex
Mr DURRANI — That is correct.
Mr BARBER — I am presuming in terms of workload for you — this ongoing maintenance function — that also would generate most of the work, the processing time, the transactions costs and ultimately the costs associated with this calculation business.
Mr DURRANI — Yes. Again, as I said, these calculations are built into what we call the business rules. These business rules have, as I said, been determined by the government, and obviously these business rules are recorded into the software. It is not that we maintain them every day. These business rules are there every day, and when somebody scans on and scans off these business rules are executed and do what they are supposed to do.
Mr BARBER — How many people are on the myki money system now as opposed to the other one?
Mr DURRANI — I do not know.
Mr PURDY — I do not have the exact details here today.
23 August 2010 Select Committee on Train Services 5 Mr BARBER — If that is something you could tell us, I would be keen to know. What do you call the other one that is not myki money?
Mr PURDY — It is just the standard pass or product.
Mr BARBER — You call it a pass. If you could find out how many people are on the myki or pass or check with the TTA, either way I would be keen to find out.
Mr PURDY — The TTA would certainly have those statistics.
Mr O’DONOHUE — Mr Durrani, you were saying the business rules are set by the government, and I think you said the business rules are quite complex. Has that complexity contributed to the delay in the rollout of myki?
Mr DURRANI — No, I do not believe it has. I think that is what the business rules were originally designed to do. I do not believe that has contributed to the delay of the program. Those are complex business rules, they do need time for us to test them and they are a big part of what we do on a maintenance release, as Greg said.
The CHAIR — To what do you attribute the delays?
Mr PURDY — I think at the outset the program from both the TTA and Kamco was overly optimistic to meet the schedule. When this contract was signed in 2005 the quickest smartcard implementation done anywhere in the world was five years. In my personal view this program is running the course it was set to run, in a time line that is probably a more sensible time line of five years.
The CHAIR — Do you have a life cycle for the myki ticketing system? How long do you expect it to last? I know what your contractual arrangement is, and presumably that will shift out a bit more because it is a delayed implementation, so it will meet that — as I understand it — 10-year time frame. Is that the ultimate life of this system as you see it or, as I understand you, given that it is designed with an open architecture to some extent, do you see that it has a life beyond 10 years, or at 10 years is it pretty much dead and dusted?
Mr PURDY — It is hard to answer that in modern day IT terms, but certainly the whole system architecture leads itself to an open-ended time frame. It is no longer tied to mechanical devices, which the current system is.
Ms HUPPERT — I want to ask a question about access to myki machines. At the moment they are just in certain places; are they going to be rolled out so that they will be available more widely and, if so, where?
Mr PURDY — As Amir said, we are in a program of staged rollout. One of those rollout segments is the retail network, and we are in discussion with the TTA now as to programming that scheduled rollout, but they will be available at other venues.
Mr BARBER — Are they available on all the city loop stations at the moment?
Mr PURDY — CVMs? Yes.
Mr BARBER — So I can buy a myki on a city loop station from a machine?
Mr DURRANI — I am sorry; can you repeat that question?
Mr BARBER — Say I want to rush out now and be part of this fantastic project and buy my first myki card from a machine. Can I go and buy one on a Melbourne Central station platform?
Mr PURDY — No, not right now.
Mr BARBER — Where do I buy one now, apart from that booth down at Spencer Street?
Mr PURDY — You can buy them online or by ringing the call centre or by going to the discovery centre.
Mr BARBER — Ring a call centre and giving my credit card or paying for it somehow or at the booth down at — —
23 August 2010 Select Committee on Train Services 6 Mr DURRANI — The discovery centre — —
Mr PURDY — The discovery centre at Spencer Street — Southern Cross.
Mr BARBER — So if I do not have a credit card, I do not have an internet connection and I live in Victoria, I have to make a trip to Southern Cross station?
Mr PURDY — At this stage of the rollout, that is correct.
Ms HUPPERT — When do you anticipate that additional rollout will take place?
Mr PURDY — It is a discussion we are having with the TTA, and it is their decision as to when we would roll it out.
Mr O’DONOHUE — You are ready to roll it out now, though?
Mr PURDY — There is a program that is in place with different devices, and the TTA will give us the schedule for when they want us to roll that out.
The CHAIR — But there is the capability. If they said to do it next week, you could do it next week? The capability is there to do it next week?
Mr PURDY — The capability of the system to do retail is there; the schedule for when we do it is a matter for the TTA.
The CHAIR — And no doubt government photos for the election.
Mr O’DONOHUE — Mr Purdy, you said before that variations to the contract are commercial in confidence, but I understand some of those variations have been released under freedom of information so therefore are not necessarily commercial in confidence. Could you give any further details about the variations that have been entered into with regard to the $494 million contract?
Mr PURDY — I am unaware of a Freedom of Information Act release.
Mr O’DONOHUE — I am telling you that has happened, so perhaps you could give me some further details of clearly not commercial in confidence?
Mr BARBER — Have you got a copy? I would not mind one.
Mr PURDY — I am not aware of the Freedom of Information Act release, so I am happy to take that on notice.
Mr O’DONOHUE — If you would take that on notice, that would be appreciated. As I understand it roughly 10 per cent of commuters are currently using the myki system. Is that correct — roughly 10 per cent?
Mr PURDY — We do not have the exact statistics. The TTA certainly has those statistics.
Mr O’DONOHUE — Do you have a feel for what percentage of commuters — —
Mr PURDY — I think it would be in that sort of vicinity.
Mr O’DONOHUE — If everyone turned up tomorrow using a myki card rather than a Metcard, could the system accommodate that?
Mr PURDY — Absolutely.
Mr O’DONOHUE — One hundred per cent?
Mr PURDY — Absolutely.
The CHAIR — Good.
23 August 2010 Select Committee on Train Services 7 Mr O’DONOHUE — Can I go to the issue of the overcharging. There have been media reports and stories about people getting money in their accounts and others having money deducted. Have you done a reconciliation of how many people — and the dollar value — have either had money added to their account or removed where errors have been made?
Mr PURDY — I think the subject you are talking about was some months back, where there were some large amounts deposited — on paper — to a card. That amount was purely an arbitrary figure that was applied to the card due to a software glitch at the time. That has now been fixed, and that will no longer occur.
Mr O’DONOHUE — Have you done a reconciliation of how many people either had money added or deducted from their accounts?
Mr PURDY — I am not aware of the exact number of people.
Mr O’DONOHUE — Have you done a reconciliation?
Mr PURDY — No, I personally have not.
Mr O’DONOHUE — Has the company done a reconciliation?
Mr PURDY — The company knows how many people or how many cards were affected by what we called an overvalued purse. As I said, it is not actually real money.
Mr O’DONOHUE — I understand that.
Mr PURDY — It was an amount that was applied to a card. The card was then blocked, because it was an incorrect amount, and then the card was reissued. We do have those numbers back at the — —
Mr DURRANI — There is no need to do a reconciliation, because it was not a financial transaction; it was just paper money that was showing up. So we know exactly how many people were affected by that. We went and addressed all those people and, as Greg said, that issue has been rectified in the latest software.
Mr O’DONOHUE — So there was no need to do a reconciliation, but you did one anyway?
Mr DURRANI — We do a monthly and a daily reconciliation of our system as part of our process. It is not triggered by any event.
Mr O’DONOHUE — How many people were affected by those mistakes?
Mr DURRANI — I do not have the exact number.
Mr O’DONOHUE — Can you take that on notice and provide it to the committee?
Mr DURRANI — Okay.
The CHAIR — So that the public record is clear on the matters — because I think we are probably dealing with media reports, and they might not be accurate — as I understand it, ERG was initially contracted to manage the installation and maintenance of the fare payment equipment, and they of course are the current operators of Metcard, as we understand. In February 2010 it was reported that Kamco terminated the contract with ERG, arguing that the takeover of that company by Videlli broke the agreement that you had with them. Consequently ERG Videlli were reported to be suing Kamco for $30 million, and there have been no further reports on that. Can you update us on the status of that contract, what is in place if ERG is not the contractor going forward and whether or not this represents any impediment to the myki system going forward?
Mr PURDY — The ERG system is currently before the courts, so we cannot comment on the ERG system.
Mr DURRANI — But it is not an impediment on what we are doing, because we alternate contractors that are doing the required activities that ERG are supposed to do.
The CHAIR — Who are the contractors that have replaced ERG Videlli?
23 August 2010 Select Committee on Train Services 8 Mr DURRANI — It is Amtek.
The CHAIR — They have taken over that installation maintenance role?
Mr DURRANI — That is right.
The CHAIR — So ERG definitely is no longer contracted by Kamco going forward?
Mr DURRANI — That is right.
The CHAIR — I can understand the court dispute — I understand that you might not want to go there because of the fact that it is before the courts — but we need to establish that there is a contractor going forward.
Can I also run by you something that is a little left field? That is: do you have any protocols or agreements in place with Victoria Police for the supply of information on any individuals using the myki ticketing system?
Mr PURDY — No, we do not.
The CHAIR — That is absolute?
Mr BARBER — There is no agreement in place — —
Mr PURDY — No, there is no agreement.
Mr BARBER — In terms of a written down agreement.
Mr PURDY — No.
Mr BARBER — But if they turn up and flash a badge, you might decide then on how to cooperate according to what they believe their powers are.
Mr PURDY — We would send them to the TTA to get that information.
Mr BARBER — Because the TTA can access the same information.
Mr PURDY — The TTA own the information that comes off the myki system that we operate. They are the owners of that, so we would refer Victoria Police to the TTA for that information. It would be for them to decide.
Mr BARBER — But the TTA do not have their own terminal in their office to look into your computer?
Mr PURDY — No.
Mr BARBER — They still come back to you and say, ‘We want that’?
Mr PURDY — They would do.
The CHAIR — Is there any other use of the generic information or an individual’s information that could be made by anybody other than the TTA?
Mr PURDY — Not to my knowledge.
Mr O’DONOHUE — As I understand it you are contracted to provide the validators on the trams and buses et cetera. On each, say, individual tram there will be a number of validators. How many of those validators have to be in operation for you to meet your contractual parameters? Is it a percentage or absolute number?
Mr PURDY — The overall availability targets are set by the TTA, and we work to those targets.
Mr O’DONOHUE — And what are they?
23 August 2010 Select Committee on Train Services 9 Mr PURDY — The targets are that the amount of devices on the tram or the bus will not impede a person using the tram or the bus, and the TTA stipulates the amount of devices that are or are not available from that aspect.
Mr O’DONOHUE — What is that number?
Mr DURRANI — It is in excess of 90 per cent. I think Mr Carolan and Mr Betts also talked to you guys a few weeks ago. That is the performance target that we were looking at with them. It is in excess of 90 per cent.
Mr O’DONOHUE — Performance target and contractual obligation are different things, so just to clarify: is your contractual obligation to have 90 per cent operational on any one, say, tram or bus?
Mr DURRANI — Yes. It is the availability of devices on the system that you are talking about.
Mr O’DONOHUE — When you say ‘availability’, that means in operation and working?
Mr DURRANI — That is correct.
Mr O’DONOHUE — On a tram, for example, 90 per cent of the validators need to be working for you to meet your contractual obligations; is that what you are saying?
Mr DURRANI — I think the business rules around that have been set by the TTA — what is considered to be a pass or a failure for a tram. We just follow what they tell us to do.
Mr O’DONOHUE — That is fine, I am just asking you — —
Mr DURRANI — I think those rules are again set by TTA. I think you need to get those rules from us. What we are saying is that the results of that, which is 90 per cent-plus availability, is what we provide to TTA in order to give them the right level of confidence. But the business rules around that in calculating that — TTA owns that.
Mr O’DONOHUE — Just to clarify that, you are saying that 90 per cent is the target, but that is not necessarily the — —
Mr DURRANI — No, we have achieved that; we have actually exceeded 90 per cent.
Mr O’DONOHUE — The 90 per cent figure, though, is that the contractual obligation?
Mr DURRANI — That is the expectation from the TTA.
Mr O’DONOHUE — Expectation and contractual obligation can be different things. Can you clarify: is that the contractual obligation?
Mr DURRANI — I repeat: the expectation from the TTA in terms of providing the right customer experience to patrons is based around that number, which is 90-plus per cent
Mr O’DONOHUE — Is that the contractual obligation?
Mr BARBER — If you fail that expectation, what impact does that have on your contract?
Mr DURRANI — That was the expectation we had in order to get the system to a state where they could go live. If we did not bring the system to that state, we would continue to work at our cost to deliver the system until it reached or exceeded that milestone.
Mr BARBER — Which you did.
Mr DURRANI — Which we did.
Mr BARBER — From now on, to maintain it at that level — what does your contract say about that?
Mr PURDY — As I said, we have a rolling maintenance release over the next few months. For the life of the program we schedule maintenance releases and continue to refine the system, not only to modify it as things
23 August 2010 Select Committee on Train Services 10 may need modifying but also as we flesh any problems in the system out, and the maturity of the system will grow over time.
Mr BARBER — But over the next 10 years when the devices start to get a bit old and it is harder to do all this sort of stuff, what does your contract say you are meant to achieve over that time?
Mr PURDY — The contract has a set availability over time. That does not vary. The availability that we provide today will be the availability we need to provide in 10 years time; it does not lead its way to being old like myself and not working quite as well in 10 years.
The CHAIR — And the availability is?
Mr PURDY — The availability right now with the system is what the TTA requires, and that is in excess of 90 per cent.
Mr O’DONOHUE — And that is for buses and trams, the same as — —
Mr PURDY — Buses and trams; that is correct.
Mr LEANE — I know the Chair read it out at the start, but I just want to go over a couple of things as far as our reference is concerned and ask you questions about it. Our reference asks us to inquire into the cause of failures to provide train services; the reference was amended to include the impact on those services as a result of the purchase, operation and implementation and oversight by the government of the myki ticketing system. As far as train failures go I would say most of us here would see as a failure a train that does not run — one that gets cancelled — or one that turns up late or stops halfway and does not reach its destination. Can you identify anywhere that the implementation and operation of the new myki system has caused a train service to fail in that particular way?
Mr PURDY — Absolutely not.
Mr LEANE — So it has not been that having to install the new things on some stations means you cannot run the trains at that particular — —
Mr PURDY — No.
Mr LEANE — Thank you.
The CHAIR — You mentioned earlier that there were no penalties applied under the contract for the delivery of the system, recognising that you were working with the TTA to get a Rolls-Royce product out there for Victoria and to that extent there was some tolerance — obviously these things are complex — and no penalties have been applied. As I understand it the government has withheld payments to Kamco though because certain time frames had not been met. Is it the case that you have at the moment had some payments withheld, pending the completion of works that had been anticipated for delivery at an earlier date?
Mr DURRANI — That is correct.
Mr PURDY — That is correct.
The CHAIR — In terms of the company’s position, that obviously puts you at some difficulty, perhaps not totally unanticipated but nevertheless at some considerable cost. Given that you have been developing this program according to a schedule that has been worked out with the government, when do you expect that you will get those payments back from the government? When do you expect that you will be in a position of having completed to its satisfaction the works that would have been anticipated by now, or earlier deadlines, and that you would be paid?
Mr PURDY — We expect to pick up those payments as we go through the schedule. As we said earlier, we have a schedule that we are doing fine detail with now with the TTA as we roll forward into the next phase, which is, as you touched on earlier, V/Line. As we achieve those milestones moving forward — —
The CHAIR — Milestones is the word I wanted.
23 August 2010 Select Committee on Train Services 11 Mr PURDY — The TTA will pay us to achieve those milestones.
The CHAIR — Are there any matters in dispute in terms of those payments and the works?
Mr PURDY — Not that I am aware of.
Mr BARBER — I just had a thought. Does the Disability Discrimination Act apply to you guys? Do you deliver the service in terms of the functionality of this service or do you deliver what the TTA wants? Is the DDA something you have to comply with or does the TTA tell you what to build and then they take that risk?
Mr PURDY — The provisions or requirements of the DDA are embedded into the requirements as to what we have to build.
Mr BARBER — So the contract says, ‘Build this’, but it also says, ‘Comply with the DDA when doing it’. If I as a citizen thought you were not complying with the DDA, that would be you guys providing a service or the TTA? Are you behind the TTA in that legal sense?
Mr PURDY — That is correct. If you believed that we were not providing, you would go to the TTA, the TTA would come to us and we would work out whether we were or were not providing those requirements.
Mr BARBER — I am not asking you for a legal opinion, but within the definition of who is providing a service within the act, that is the TTA. You are just the back end.
Mr PURDY — That is correct.
The CHAIR — Can I just ask if the government has any exposure in terms of the ERG Videlli legal action?
Mr DURRANI — Again, I am not a lawyer, but as far as I know, no.
The CHAIR — So the action only names your companies as the respondent — —
Mr DURRANI — That is correct.
Mr PURDY — That is correct.
The CHAIR — And the government has no exposure that you are aware of to any compensation claimed by ERG?
Mr DURRANI — That is right.
Mr O’DONOHUE — The authorised officers use hand-held devices. Are the authorised officers to your knowledge issuing reports of non-compliance — infringement notices?
Mr PURDY — The hand-held device is capable of issuing infringement notices. Whether or not they do issue is a matter for the TTA; it is a government issue.
Mr O’DONOHUE — But you must be aware of reports of non-compliance because presumably you hold that data?
Mr PURDY — No.
Mr O’DONOHUE — If you are using the hand-held device, the authorised officer can decide to issue a report of non-compliance, and then that, as I understand it, can lead to an infringement notice. Would there not be a repository of data that a report of non-compliance had been issued that would be held by you, which could then be accessed by the TTA?
Mr PURDY — I am not aware of that capability within the system, but I am not saying that capability is not there. I am happy to take it on notice and find out that for you.
Mr O’DONOHUE — Great; that would be good if you could do that. There is a bill coming before the Parliament which amends the Transport (Compliance and Miscellaneous) Act 1983 relating to the giving of
23 August 2010 Select Committee on Train Services 12 computer-derived evidence with regard to infringement notices. Have you had any input into this legislation? Are you aware of this?
Mr PURDY — Personally, no.
Mr O’DONOHUE — I suppose the question is whether the back-office data collection et cetera is secure enough and competent enough to be used for evidence purposes.
Mr PURDY — Absolutely.
Mr O’DONOHUE — You are comfortable with that?
Mr PURDY — I am comfortable, yes. I was not aware of the bill, but I am comfortable with the question.
Mr O’DONOHUE — Mr Purdy, if you could just take on notice that issue of the variations to the contract. Could you respond with the dollar value of those variations, if they are, as I understand them to be, available under FOI?
Mr PURDY — Certainly.
The CHAIR — That will conclude the hearing as such. As I indicated to you, a Hansard transcript of today’s proceedings will be provided to you, and if there are any aspects of the hearing that you wish to clarify or that you think might be a matter of error, you might like to bring those to our attention. However, as I said, matters of substance are not able to be changed. We do extend thanks to you for making yourselves available and for participating in the hearing and assisting the committee in its deliberations. I thank you very much.
Mr PURDY — Thank you.
Mr DURRANI — Thank you for the invitation.
Committee adjourned.
23 August 2010 Select Committee on Train Services 13