I have reported extensively in my previous reports to the National Executive Board, as well as to CUPE members at the provincial division conventions in 2002, about some very serious financial and operational problems related to arrangements with a computer contractor. These arrangements came to light soon after the last National Convention when Sister Judy Darcy and I decided to carry out a financial review prior to developing a 2002 budget for CUPE. As I have already reported, we discovered that CUPE had paid $12.9 million from 1997 to 2001 to BridgeTech Systems, a computer-consulting firm, for technology that did not, in the end, serve our needs.
I know that CUPE members want reassurance that this will never be allowed to happen again.
The financial arrangements with this computer-consulting firm were never revealed to either the National President, the National Executive Board, or the National Trustees. Money was paid to the computer firm, authorized by the person then in the position of Managing Director of Finance and Administration, but the full amount paid was never reported.
Budget documents and financial statements provided to the National President, the National Executive Board and our elected Trustees showed technology expenditures of a much smaller amount because budget and financial statements reported the annual value of our computer costs amortized over many years. The National President, the National Executive Board and our Trustees were led to believe that the budget and financial statements reflected the real costs of computer technology and approved them as such.
The National President, the National Executive Board, and the National Trustees were relying on financial statements prepared by the National Secretary-Treasurer to know what was being spent.
It was therefore only after Sister Judy Darcy and I engaged an outside financial accounting firm to review our books that we discovered how much money was actually paid to the computer firm. It was only then that it came to light that the budget documents and financial statements previously given to the National President and the National Executive Board were misleading with respect to how much money the computer firm was costing CUPE. And to make things worse, the financial review also revealed outright fraud, which I have already extensively reported on in full disclosure reports to the membership.
I want to reassure everyone that things are being run differently now. The new Managing Director of Finance and Administration is directly accountable to both the National President and the National Secretary-Treasurer. The budget documents and financial statements provided to the National President and the National Executive Board are explained in detail. The real and actual costs of CUPEs computer technology are reported fully in both the budget documents and the financial statements, as are the real and actual costs of every part of CUPEs operations.
All decisions with respect to computer technology are now overseen by a steering committee of senior staff that reports to both the National President and the National Secretary-Treasurer, as well as to each meeting of the National Executive Board. Our computer services have been brought in-house and the head of our Technology Branch is directly accountable for carrying out the decisions of the Technology Steering Committee. Most importantly, the director can only spend within the clear limits established by the National Executive Board.
The mistakes of the past in the area of computer technology have cost our Union dearly. However, we are now practicing good financial management and we are taking all the necessary steps to develop technology capacity that is affordable and that truly meets the needs of our members and staff.
Since my last report in December we have continued to progress in accordance with CUPEs technology initiatives set out in the Information Technology Strategic Plan, which was adopted by the Board in September. Much of our focus since my last report has been directed toward finalizing the analysis of a replacement financial system for the existing Oracle application.
The IT Steering Committee continues to meet regularly and on January 10th unanimously agreed to recommend the Solomon product as the new system for CUPEs financial applications. This decision was made after a detailed review of both the Solomon and Great Plains products (both of which are mid-range systems suitable to CUPEs size) and was based on a best-fit analysis to ensure that CUPE would receive good value for the total projected cost.
Immediately following that decision, we began a tendering process to select a vendor to work with CUPE on the implementation of the Solomon product. This process was carried out in accordance with the Strategic Plan to ensure that multiple bids were considered. At the end of the tendering process the IT Steering Committee will be presenting a recommendation to the Board regarding a supplier for the Solomon product. The tendering process closed on February 12th and the Steering Committee will be meeting February 18th to analyze the bids and make a recommendation. We have formally begun organizing and designing the new Collective Agreement Information System (CAIS) designed to replace the old SALAD and CARS systems. This new system will enable an efficient analysis of CUPE collective agreements and allow our Research staff to provide more timely and accurate information about contract language, benefits and wages. Providing timely information will be a big help to our members on the front lines, negotiating collective agreements. The redevelopment of this system is long overdue. This product will be tightly integrated with and make use of the central database contained in the Local Union Information System (LUIS) set for initial release later this quarter.
On the infrastructure side, we have continued to work towards replacing Novell with a Microsoft 2000 (NT) platform for servers and desktops in the regions. This process has to-date included adjusting our internal network design and we are now very close to tendering the migration from Novell to Windows 2000. When this project is complete, in summer 2003, all CUPE offices will be on an up-to-date common platform that adheres to the technology direction set in the IT Strategic Plan. The benefits for CUPE include, among other things, more cost-effective network management and the ability to access files on the network through a standard dial-up.
Following the adoption of the budget in December, we have proceeded with further steps to reduce our reliance on outside contractors. The positions of two of the contractors who have been performing help desk tasks at National Office are being replaced by staff positions over the next month, while the contractor role of Oracle database administrator has been reduced by almost 50%. By the second quarter of this year, our reliance on outside contractors will have been reduced to a total of 2.5 people from the 14 that were in place at the end of 2001.