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ERG had good experience in two of the three key ingredients of a transport smart card - the card-reading hardware on buses and at train stations, and the software for transmitting information stored on the cards. But the third ingredient - the back-office system that allots payments to operators and sets smart cards apart from earlier-generation electronic ticketing - is the most difficult. Hong Kong was the first time ERG tried it.

ERG promised Sydney would use a system called the Multi-Application SmarTcard Solution, or MASS, based on its Hong Kong system. In bidding for Sydney in 1999, ERG promised that MASS was a proved technology that could be replicated in Sydney, and that its other projects in Singapore and San Francisco would use the same tool.

These turned out to be hollow words. By the time the Government chose ERG for a second time, over Cubic, the Government knew it.

A government evaluation in April 2001 said problems with MASS indicated ERG "has not met agreed schedules on a relevant project, despite their submission indicating that this was possible, achievable and expected.

"The risk that the development of MASS for the Sydney project will take longer than scheduled is increased," the report said.

In March 2001, the Sydney evaluation team was told by Californian consultants Booz Allen that San Francisco was not going to get the MASS system but a "modified version" of the Hong Kong clearing house. That same month, Wildermuth, under contract to the Government, told the team that Singapore would not be taking on ERG's MASS software. Sydney "would be a guinea pig for MASS", he said.