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Rise and fall of the man behind Ultranet scandal

Timna Jacks

Disgraced education department official Darrell Fraser was already building an Ultranet project at least a decade before it was launched.

In the 1990s, as principal of Glen Waverley Secondary College, he was directing his staff to build what was a Victorian first, an intranet school system that would give parents, teachers and students 24-hour access to course content and student reports.

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Victoria's Ultranet fiasco

Here's what the $180m Ultranet IT project for Victorian Government schools was meant to do.

Fraser sensed a commercial opportunity, and he and a handful of Glen Waverley teachers secretly set up a private company, Cortecnica, to sell their new product. 

The enterprise attracted the interest of multinational IT company Oracle, and the company and school started trading knowledge about their software. 

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The Independent Broad-Based Anti-Corruption Commission (IBAC) would later describe this as an "unusually commercial attitude … with respect to school affairs."

Then, in 2003, the ambitious principal shot to deputy secretary of the education department in what the watchdog would describe as "by all accounts, an extraordinary promotion".

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By 2005, the Labor government promised to build Ultranet: an online portal to "revolutionise learning" that was based on the model developed by the staff at Glen Waverley Secondary College. Fraser was appointed to drive the project.

A man without any training in financial management beyond his experience as a school principal was overseeing 70 per cent of the department's multibillion-dollar budget .

But even before Ultranet was announced, Fraser's relationship with Oracle had raised a department probity officer's concern.

The company, which would go on to win the multimillion-dollar Ultranet contract in a consortium with CSG Limited, was exclusively invited to join Fraser on a department working group to pilot a statewide intranet program.

The company was given what was described by an Oracle executive as a "box seat" for the tender – an opportunity IBAC would say gave it access to key department staff in a position to "influence the tender process".

In a bond that would characterise the kind of "unchecked relationships" and "conflict of interest" that IBAC would warn leads to corruption, CSG Limited offered Fraser interstate and overseas trips, while Fraser agreed to spruik the company's product at conferences.

Experts working on the deal stressed that CSG was a dud. The company had no experience delivering a project of that magnitude, they said.

But Fraser ignored their advice, raising serious probity breaches that were expressed to then education minister Bronwyn Pike.

Yet Fraser remained on the board that would award the Ultranet contract.

IBAC would later find that Fraser broke department rules and secretly communicated with CSG during the tender process.

He also tried to influence the tender evaluation by "stacking" an assessment team with like-minded colleagues. 

IBAC found that in an effort to bolster CSG's chances of winning the contract, Fraser created a "sham" $1 million department-funded contract, paying another company $10,000 a month to be used as a front.

In June 2009, little-known Darwin company CSG Limited won the contract with Oracle, prompting a consultant to describe Fraser's disregard for their advice as "the closest thing to corrupt" he had seen "in 20 years of working in Victorian government".

By August 2010, a $22,000 bus covered in Ultranet branding drove Pike into the Melbourne Convention and Exhibition Centre to celebrate a project that had crashed on the day of its launch.

To the tune of Madonna's Material Girl, performers in flamboyant costumes sang: "We are living in a virtual world, and I am an Ultranet girl."

A beetle-browed Fraser waltzed onto stage at the $1.4 million event and confronted the elephant in the room: "Who would have guessed that the Ultranet went down yesterday?"

Fraser assured his audience the system would soon be revived. But it wasn't. And as the department boasted in an invitation to the Big Day Out: "There is no plan B."

Two years later, the system was still so plagued by technical issues, that only 10 per cent of students could use the technology, and the Napthine government dumped it in 2013.

A select few would stand to benefit from the high-profile venture: a coterie of department executives - Fraser's mates - who formed an oppressive and "boozy, blokey club" and would buy shares in CSG, in what IBAC would later identify as insider trading.

Fraser, for his part, was rewarded with a senior posting at CSG.

Former regional director John Allman told IBAC that Fraser's intentions were good: "Darrell broke every f---ing rule in the book ... he spent more money than he should have … but it was for the good of f---ing education."

On Friday, IBAC took a different view.

Fraser's single-minded pursuit of the CSG/Oracle consortium amounted to "appalling waste" that could only be understood "through the lens of the likely private gains", it said.

"The failure to address Mr Fraser's behaviour time and time again can only be described as a serious failure on the part of some of the most senior leadership within the department."

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