Universities sue UK supplier

May 9, 1997

THE largest consortium of Australian universities is counter-suing a British-owned computer software supplier, CHA Computer Solutions Pty Ltd, for alleged late delivery and alleged shortcomings in an administrative software package expected to save university administrations tens of millions of dollars.

The consortium, UniPower, represents 19 universities and is a subsidiary of the Australian Vice Chancellors' Committee. It is seeking damages in the New South Wales Supreme Court for delays and inadequacies in CHA's delivery of software.

CHA (previously CHA UK) is owned by the British-based Misys Group. In 1993, when UniPower negotiated the contract with CHA, Misys was providing administrative computer systems for universities in the United Kingdom and had a well-established reputation for its software in the banking and finance industries.

UniPower signed the contract with CHA after an extensive process of consultation and tendering. Under the contract, CHA was to have supplied a suite of integrated operational software by the end of 1995.

The software was to provide core applications for managing administrative areas such as finance, student records, physical and human resources, and research and consultancy. UniPower cancelled the contract in February this year, prompting CHA to sue the consortium for breach of contract and seeking payment of a bond of almost Aus$5 million.

In its cross-claim, UniPower alleges that CHA and associated parties failed to meet their obligations under the contract, notably that the firms did not deliver acceptable software for the finance areas. The consortium claims that CHA and others made representations prior to the signing of the contract and subsequently about progress in developing the software that breached Australian Trade Practices and Fair Trading Acts.

Frank O'Neill, UniPower chairman, said the consortium was committed to the project which would ultimately provide significant cost savings and greater efficiencies for university administrations.

"We are firm in our resolve to successfully complete the project so that each university has access to an integrated, core administrative system that can be tailored to meet individual needs,'' Mr O'Neill said. "The project has had problems with its software developer but it will ultimately meet the administrative requirements of universities well into the next millennium.'' The supplier's involvement in the UK higher education market dates back to the government-funded Management and Administrative Computing (Mac) initiative which began in 1988. Mac encouraged British universities to form large consortia to specify and purchase administrative software systems, a model which has been also been followed by Australian universities.

CHA Computer Solutions, which has since changed its name to Specialist Business Solutions, was commissioned to develop a suite of application programs by the Powerhouse family of universities. Powerhouse had about 20 members, and was one of four groups of UK universities which received Government funding from Mac. Each of the four groups dealt with a different main software supplier.

Mac ran for seven years and distributed total funds of approximately Pounds 1 million a year. Most of the costs of software development were borne by the 60-odd institutions involved.

CHA Computer Solutions began delivering parts of the software to UK universities during 1992, including payroll and personnel applications.

As higher education and further education customers outside the original group signed up with CHA, the Powerhouse family was replaced by the CHA National User Group for Education (Change).

Phillip Bell, managing director of Specialist Business Solutions said: "Neither Specialist Business Solutions nor Misys plc has any comment to make on any court cases concerning the company."

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