SKAIS 2 in risk of remaining a black hole

Director General of the Social Insurance Board Egon Veermäe Photo: Eero Vabamägi

Head of the Social Insurance Board Egon Veermäe cannot promise that the recent cost increase of the SKAIS 2 information system by eight million euros will be the last: political changes inevitably reflect in cost.

A tender by the Health and Welfare Information Systems Center in January makes the new version of the SKAIS 2 social protection information system, that has already cost the taxpayer €15 million, more expensive by €8 million. The total cost of the project is nearing €23 million. The project has been moved from the administrative area of the social ministry to that of the social insurance board.

“Everyone is talking about some mystical information system, but that is not what is being developed – we are working on services,” Veermäe said on the “Postimees Live” program yesterday. “The services we are developing keep changing. We are developing services that didn’t even exist in the initial plan.” That, according to Veermäe, is the simple reason why the project keeps getting more expensive.

He said that the problem with state information systems is that they have been developed with no mind paid to maintenance costs. A number of services offered by the social insurance board are still on the old platform that has no support. “They need to be moved, it is inevitable,” Veermäe said. Because the board is set to introduce changes to the pension system, continuing to use the old software entails the risk of some 400,000 people being cut off from payments if the system cannot cope.

The other reason for the new tender is making use of EU subsidies. The existing procurement does not allow for use of subsidies as necessary conditions were not acknowledged at the time.

Veermäe has no criticism for developers Nortal and Trinidad Wiseman: cooperation is coming along on schedule, and the new tender does not alter the sides’ binding contract for €10 million. Veermäe said, however, that the sum is an estimate. “We do not know how much it will cost in the end. Those figures have a life of their own,” he admitted. The developers spent a million euros last year, Veermäe said.

SKAIS 2 can be considered the most expensive and most complicated development Estonia has undertaken. The project was launched in 2014 in the hands of developers Tieto and Icefire who spent a total of €7 million. Cooperation between the two companies failed and ended. The work was taken over by Nortal and Trinidad Wiseman. The former is tasked with reorganization of old system architecture, follow-up development and software maintenance, while Trinidad Wiseman is in charge of user interfaces.

Secretary General of the Ministry of Social Affairs Marika Priske took responsibility for the failed SKAIS 2 development in 2017, after it turned out the project had used up all its resources but only implemented a fourth of what was planned. By then, the ministry had decided to stop working with Tieto, demand the developer pay damages of €800,000 and to declare a new tender in the volume of €10 million. Priske told ERR at the time that she believes politicians cannot be blamed for the project failing, especially since Estonia has seen social ministers come and go in recent years.

Minister of Social Protection Kaia Iva proposed referring to development of SKAIS 2 differently during yesterday’s Riigikogu Question Time. She believes it would be more appropriate to talk about work on the social system’s information system and IT developments in the future.