The C2000 communications network and integrated emergency switchboard

• Conclusions
• Response of the State Secretary for the Interior
• Afterword by the Court of Audit

Conclusions

As an innovative project with many national, regional, and local participants, C2000 has a complex organisational structure. The Court of Audit's main conclusion is that it is doubtful whether C2000 will be ready to go live by 1 January 2004. The regions also expect delays in going live. On 16 May 2003, the State Secretary for the Interior and Kingdom Relations told the House of Representatives that the C2000 infrastructure would now be ready by mid-2004. The Court of Audit also concludes that the ultimate costs are unclear.

Nor has the House of Representatives received an adequate picture of the content, finances, or planning of C2000. It is generally agreed that it is useful and necessary to replace the current analog networks. But much remains to be done to ensure support for C2000 among its users. The Court of Audit therefore recommends that priority go to remedying users' concerns and improving communications between the Interior Ministry and the users concerning system functions, planning, and finances. As to informing the House of Representatives, the Court of Audit endorses the advice of the Report on Information Provision concerning Large Projects (House of Representatives, 2002-2003, 28 645, nos. 1-2).

For each question asked by the House of Representatives, we summarise the Court of Audit's response.

Questions 1, 2, and 3: C2000 and GMS - estimates, financing, and budget monitoring

C2000's original budget was based on inadequate estimates, which remained unadjusted until 1999. With the launch of the Costs and Benefits Working Group in March 2000, the estimates became more transparent. The Court of Audit notes that the Interior Ministry kept the estimate in the 2001 Final Report within the financial limits artificially. Its assumptions were unrealistic, and it counted on windfalls that were unlikely to materialise. The Court of Audit believes that project estimates should have been comprehensive, providing insight into all the project costs, irrespective of who was to pay.

C2000's investment costs are higher than the project budget shows. Not all the costs were estimated, and some were paid from sources other than the project budget. The operational costs for the regions (fire, police, and ambulance services) were insufficiently clear from the start. It was assumed that the users would not have to face higher operational costs - which was unrealistic. Only in 2003 did the Interior Ministry commission a study to gain more insight into these costs.

The Interior Ministry did not earmark the funds for C2000. So no overview of funds for C2000 exists, and it is impossible to determine whether they were spent on C2000. What is more, some spending is not included in the estimated project budget, so there is no overview of C2000's total costs. The Ministry monitored only the part of the budget that it provided itself. So it had an insufficient picture of the total project budget, its exhaustion, the changing project description, and the result achieved.

As to GMS, the original estimate of its duration was too optimistic. The changes in the logical design, problems with the supplier, and disappointing performance made it take longer and cost more. In addition, the regional costs were consistently ignored.

Question 4: C2000 - quality, schedules, results

It is very doubtful whether C2000 will be ready to go live by 1 January 2004. Nor can further delays in the completion of the network be ruled out. The system's structure does largely comply with the functional requirements set out in the 1996 Functional Programme of Requirements. But a definite assessment of how it performs in an operational situation will be possible only once the infrastructure has been completed, the network versions installed, and the national tendering procedure for peripheral equipment contracts has been concluded. Since C2000 has not been extensively tested in an operational setting, risks exist with regard to its performance and controllability. In the past few weeks, various media have drawn attention to the risks: medical equipment in ambulances and hospitals may break down, and the users of TETRA peripheral equipment may face health risks.

Since 2000, the project's organisational structure has improved in some ways, but the Court of Audit describes communications between the Interior Ministry and C2000 users as inadequate. The Ministry has not managed to create enough support for the system in the fire, police, and ambulance services.

Question 5: provision of information to the House of Representatives

The provision of information about C2000 to the House of Representatives shows major failings. On two-thirds of the items tested, the C2000 failed to provide information in line with the Large Projects Procedural Regulations. Some information was available at the Ministry but did not reach the House of Representatives. One example is information about delays in the project. Other information, about finances for instance, was not in the possession of the State Secretary himself. The internal auditor's report also shows major failings in complying with procedural regulations.

Owing to these failings, the House of Representatives has over the years been unable to get a reliable picture of the finances, content, and planning of the C2000 project. The information on finances and progress was consistently inadequate.

In late 2002, the State Secretary failed to provide all the information available at the Ministry about a possible delay to the completion date. The information that the State Secretary sent the House of Representatives on 24 February 2003 did not mention a possible delay and was therefore incomplete. The possibility of a delay was, however, reported to the informateur (who explores the possibilities for a new coalition government) on 24 January 2003.

The progress reports sometimes sounded more optimistic than they should given the internal reports and the reports of the external evaluator. The House of Representatives also received information later than it should, and it failed to receive information that the House had asked for several times.

As to the GMS project, the Court of Audit notes that the House of Representatives was not informed clearly on several occasions about delays and rises in costs. Changes to the project budget and planning were not made transparent. The House of Representatives also received scanty information about the operational costs of GMS.

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Response of the State Secretary for the Interior

On behalf of the Minister of Defence and State Secretary for Health, Welfare and Sport as well as in his own capacity, the State Secretary for the Interior and Kingdom Relations replied to the Court of Audit's draft report on 21 May 2003. He said that although the draft report was critical it contained valuable recommendations. He did not share the conclusion about the project budget. He supported the main points of the other conclusions and recommendations.

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Afterword by the Court of Audit

The Court of Audit partly incorporated the State Secretary's comments on the project budget into its report, but stands by its conclusion about the project budget and its recommendation that complex administrative contexts require comprehensive project budgets and records. Only thus can the House of Representatives and the users gain a reliable insight into the estimated and incurred costs of a project. And only thus can joint responsibility for the project be expressed.

The Court of Audit also believes that the State Secretary inadequately addressed the criticism that the project estimate offers no insight into the total costs of the project.

Otherwise, it generally approves of the measures taken and announced by the State Secretary. It will continue to follow their implementation closely. It also draws attention to the remaining concerns of the users and the need for a clear rule on reporting risks to the House of Representatives.

If an organisationally and technically complex project is to succeed, the Court of Audit considers that it needs joint responsibility combined with clear steering and communications.

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