Can't imagine the Sydney ratepayers will be too happy about the cost of getting their smartcard - a whopping $1.2 billion contract awarded to Cubic to produce it - using senior ERG staff and licensed ERG technology.
http://www.smh.com.au/technology/enterprise/smartcard-operator-branded-dishonest-20100411-s0w2.html
Smartcard operator branded 'dishonest'
ANDREW CLENNELL AND LINTON BESSER
April 12, 2010
A SMART travel card will be delivered to Sydney 15 years after it was promised, for four times what it was supposed to cost, by a company that tried to abort the original Tcard contract with what a judge described as ''reprehensible conduct''.
The NSW Transport Minister, David Campbell, announced that Cubic Transportation Systems had won a $1.2 billion contract for TCard as part of a group called the Pearl Consortium.
But the Herald can reveal that Cubic sued the government 10 years ago in an action that helped prevent delivery of the Tcard by its rival ERG and exposed allegations of improper behaviour by Cubic.
ERG had promised to deliver the smartcard for $367 million before the government cancelled its contract in 2008.
Last night it emerged that Cubic had been assisted by a former Labor treasurer, Michael Egan, who confirmed he had lobbied on its behalf during the latest tender process.
Mr Campbell confirmed he had met Mr Egan and the president of Cubic, Steve Shewmaker, in January last year, five months after expressions of interests were called for the second version of Tcard.
Mr Campbell defended the meeting, saying the ''probity auditor for the electronic ticketing project was there''.
In 2001, Cubic launched a court action against the government but the case exposed an improper relationship between its then managing director and a RailCorp employee alleged to have leaked tender secrets to Cubic.
Ruling against Cubic in 2002, the NSW Supreme Court judge Michael Adams found it was ''guilty of reprehensible conduct'' and had shown a ''lack of good faith and positive dishonesty'' in the tender process.
Mr Shewmaker said last night: ''That issue is ancient history and I don't intend to revisit the past. It's time to move on.
''Cubic is committed to performing on this contract and giving Sydney the excellent system it deserves.''
The MyZone fare system starts on Sunday. Mr Campbell said yesterday the smartcard would be introduced in 2012 and that Cubic and its partners were responsible for the Oyster card in London. He admitted the card should have been operating long ago.
''The new system will allow commuters to tap on and tap off from different modes of transport - trains, government and private buses, and government ferries,'' he said.
''It will operate in a similar way to an e-tag. Each card or tag can be linked to an account from which the price of the journey will be automatically deducted.''
In another twist, several senior employees on the ERG project are likely to work on the Cubic project. Some engineers involved in the Tcard project have recently been hired by Cubic.
The managing director of VIX ERG, Steve Gallagher, said Tcard would be operating today ''if it was not for the lack of co-operation from the NSW government''.
''The total Tcard contract value of $350 million represents fair value and an enormous saving on the reported $1.2 billion for the Pearl Consortium project,'' he said.
''It is also interesting that since this time one of the successful consortium members, Cubic, have acquired and licensed ERG technology and operations contracts in San Francisco and more than 20 staff in Perth - several of whom had key roles in Tcard.''
But Mr Campbell defended the cost blowout. ''There's an upfront capital cost and operating costs for 15 years,'' he said. ''I don't think we should be comparing this project in any way, shape or form with ERG. The ERG process started years ago and they failed dismally.
''The [new] process has been extremely tight in terms of its probity and the probity auditor has ticked off on it.''
The first Tcard project was abandoned after a series of delays by ERG and because of resistance to change within transport agencies.
A key problem was the government's repeated failure to reform the public transport fare structure, which contained 500 fare groupings.
MyZone will reform that complicated structure. The consortium that includes Cubic beat several companies including the German organisation Scheidt & Bachmann to run the system.
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