Treasurer system of the Russian Federation (AS FK)

Evolution of system developers: from Finservice to OTR-2000

Once in RVTS GNS Cheboksary the commercial direction which was engaged in writing of the software for territorial subdivisions of the Ministry of Finance of the Russian Federation was open. At that time, time of economy of money, it was commercially successful project since earned money is commensurable, and that even is more than those that GNS was allocated for the maintenance of the branch to Cheboksary. The Moscow firm "BFT" led by g-ohm Popov A.Yu. was one of competitors .

When the management of GNS decided to replace the director of RVTs Cheboksary it organized Finservice company in hope to take away the sales department under the aegis, but the department decided to arrive differently - they organized own company "Keysystems". Source texts of programs remained in RVTs, but as the direction was not profile, to use them and could not continue support of the RVTs program. Keysystems recovered source texts at this time and patented them. The director of Finservice recruited new specialists and began to study an opportunity to return the lost piece on communications. Meanwhile Keysystems began to work with the Ministry of Finance. Further communications of the director of Finservice yielded result, the Ministry of Finance held a competition on which Finservice was the winner. Further transfer of source texts of the program of Keysystems company to the Ministry of Finance took place, and then already the customer the Ministry of Finance gave them to Finservice.

Further labor everyday life when new specialists of Finservice not always coped with support of the program began and clients began to return slowly to specialists of Keysystems. In those days there was no tough centralization yet and clients were given the chance and means to work with those with whom it was convenient to them. Crash of Finservice company became a result, and Keysystems took away most of their programmers to itself.

Further Mr. Popov A.Yu. leaves the commercial structure in FC Russian Federation. After a while competition on support of the software which is won by OTR-2000 company (under the terms of tender of Keysystems from it it was removed) is announced. On closer examination, former employees of BFT company are the staff of OTR-2000 company. Further there is a transmission time of the program from Keysystems of OTR-2000 company, but is not emergency any more, and it is more detailed and as soon as the company felt in itself forces to work independently they said goodbye to Keysystems finally. By the way tender when OTR-2000 company for those times was drawn on the horizon seemed is unreal big and made 20 million rubles, before tenders kept within the range of 1-4 million rubles.

Upgrade of an automated system (AS FK)

Shift of terms of system development

The automated system of Federal Treasury was designed to replace the system "Center-KS" developed earlier. Its creation cost to the budget 673 million rubles – the corresponding tender on implementation and maintenance of software in 2005 was won by OTR company. According to Alexey Popov, all works at OTR were accepted, and afterwards this company was included into consortium with Oracle and was engaged in replication of a system.

Technical works on creation of AS FK started in 2005. It is decided to build it was based on the ERP system of Oracle E-Business Suite. Oracle became the head contractor on these works. The consortium with it included Scientific Research Institute Voskhod, Borlas, FORS and Oviont Inform. According to the plan the project had to proceed 7 years. For 4 years (since the beginning of 2006 prior to the beginning of 2010) it was supposed to create and spread around AS FK in regional departments, then a system had to rise on three years' warranty service.

But the Federal Treasury did not manage to complete creation of the All-Russian IT system of budgeting in time. By the beginning of 2010 it had to function in all 83 regions of the country, and earned only in six.

Start of one of the most large-scale state IT projects in Russia is delayed a minimum for two years. The automated system of Federal Treasury (AS FK) which should provide budgeting nationally (data collection, drawing up plans, the analysis the plan fact, etc.) in the middle of 2010 was going to be unrolled only by January 1, 2012 whereas earlier start was planned for January, 2010. This CNews was declared by the deputy manager of Treasury Alexey Popov. He explains considerable shift of terms of start with changes in the legislation.

At the beginning of 2010 department accepted works only on development and trial operation of a system, Alexey Popov reported CNews. From allocated funds, according to him, only 10-15% are paid to contractors for June, 2010. Financing happens through the head contractor - Oracle company.

It was planned that by the beginning of 2010 across all Russia in structures of Treasury 367 thousand automated jobs will be unrolled (from which 30 thousand in Treasury, the Ministry of Finance and Accounts Chamber). But for the beginning of 2010 their number does not exceed 27 thousand. They are set in 6 regions of Russia from 83.

Financing of upgrade of a system

In five years department distributed the enormous IT budget exceeding 15 billion rubles.

The World Bank which issued to Russia the credit for these purposes in the amount of $444 million agreed to finance upgrade of Treasury. As explained CNews in bank, conditions of loan granting are typical, the percent on payments is established at the level a little above a rate of LIBOR. Details of the transaction with the World Bank see in the History of Treasury block here.

It was supposed to spend nearly $65 million from the funds allocated by the World Bank for ERP.

Financing of IT in Federal Treasury. The funds allocated from 2005 to 2010.<p>

Source: CNews Analytics

Also asked questions of postponement of the project of CNews participants of consortium. The representative of Oracle Marina Savinova answered that all questions on the project are competences of Treasury. Alice Akulova, the representative "A swagger - Development center" told that without the consent of the general contractor (Oracle) the company subcontractor has no right to give any information. The representative of IBS Evgeny Kutilov said that participation of Borlas (enters into IBS group) in the project is stopped in 2007 for the organizational reasons and it would not be correct to give comments.

The World Bank except two December contracts of 2005 with Oracle (from the American Oracle Corporation and the Dutch Oracle of Netherland B.V., everyone for $34.8 million) announced some other large payments to the Russian integrators, as a rule, for servers for system deployment in regions (complete list). Except vendor of the ERP system the large amounts on the project were selected to the companies:

• I-Teco ($15.4 million in December, 2007, $31.1 million in November, 2008 and $24.5 million in December, 2009),
• Croc ($23.7 million in December, 2009),
• Kraftway ($19.8 million in May, 2010) and
• "Systematics" ($29.5 million in August, 2008).

Except these amounts through the World Bank a large number of much smaller amounts was selected for consultation, training, etc. Only $165 million from which about $163 million fell on 2005 - 2010.

Total amount on upgrade of IT of Treasury except the program of the World Bank consists also of costs of the Russian budget. According to CNews Analytics, the total amount of the tenders announced by Treasury from 2005 to today connected with IT was more than 7.5 billion rubles (complete list) Here get both works on legacy systems, and connected with AS FK. From this amount about 2.5 billion rubles were spent for development, creation and completion of software.

In June, 2010. The Federal Treasury announced two more tenders connected with information systems for the total amount more than 1.1 billion rubles. Their winners will be defined at the beginning of July, 2010. We service the works connected with the equipment and completion of an information system of department contractors will execute within 1.5 years.

The winner of an electronic auction with a maximum amount of nearly 933 million rubles will be engaged in maintenance of all equipment of AS FK (servers, storage systems, etc.) which will be set in all regions of Russia, will take reserve computer center and the official site and also maintenance of central office of Treasury on outsourcing. Besides, the contractor of the goskonstrakt will have to inspect regional bodies of Treasury and make the specified technical requirements to a system.

The company which will win an open competition with the starting price nearly 200 million rubles will have to finish a program part of AS FK under the changed legislation.

Thus, the total amount of the IT contracts signed by Federal Treasury for the last five years was exceeded by $230 million from the World Bank and 8.6 billion rubles from the Russian budget (apart from numerous unaccounted small agreements) i.e. more than 15 billion rubles Alexey Popov considers what in addition to already announced amounts of any additional expenses on creation of AS FK will not be required.