Crown and IBM Announce Settlement of INCIS Claims

  • Bill Birch
Finance

The Crown and IBM jointly announced today that the Crown has accepted an offer by IBM to withdraw its $75 million damages claim against the Crown and pay the Crown $25 million to settle the INCIS dispute. The Crown in return will discontinue its claim against IBM.

The agreement also authorises the Police to pay IBM $18 million for work already done and equipment delivered by the company. Payment had been held up pending resolution of the dispute.

Finance Minister Sir William Birch, heading Government's Ad Hoc Ministerial Committee on INCIS, and Mr William Slavin, general manager, Business Integration Services, IBM Global Services, Tokyo said the agreement was satisfactory to both parties and allowed both the Crown and IBM to avoid the costs associated with a lengthy trial.

"The settlement lets both parties to the dispute move ahead with business which is more constructive and more rewarding than legal action," they said.

"It will also clear the way for important decisions by Police next year about the future of their computing requirements beyond Increment 1 of INCIS."
In addition to the cash payment, IBM also agreed to give Police, at no cost, all of the work completed to date on Option C, which IBM developed at its own initiative as an alternative to INCIS Increment 2.

"INCIS Option C will therefore be available to Police for consideration when decisions are being made next year about the best route to take in the future development of Police computing," they said.

Despite the dispute, IBM and Police have worked together under a separate contract to maintain Increment 1, and will continue to do so.

Mr Birch noted that all of the payments involved in the $18 million released to IBM have already been accounted for in the total INCIS budget. With the settlement in place, the Crown was now in a position to release the money to IBM in recompense for work done, he said.