A report into the development of the health service's computerised staff management system says the project did not have a defined budget.
Based on figures to the end of October this year, the report estimates full roll-out costs of the Personnel, Payroll and Related Systems (PPARS) project at €195 million by December 2006.
The project was suspended earlier this year pending review after its cost had reached €133 million. The system has been partly implemented but has produced a number of embarrassing errors such as massively overpaying staff.
PPARS was intended to centralise pay and human resources management for health service personnel across regions and agencies.
It was intended to be in operation by 2000 at a cost of €9.1 million. Despite this, the value-for-money audit published today by the Comptroller and Auditor General (C&AG), John Purcell, found the project had been rushed.
"The project was driven by a desire to implement in as quick a timeframe as possible," the report said. This overstretched resources with "adverse consequences," it added.
The C&AG report says the project was poorly managed and has not delivered any savings. It was particularly critical of the €57 million spent on consultants, including €38.5 million to Deloitte.
"Because of uncertainty around funding, agency participation and other factors, the PPARS national project team entered into a series of short-term engagements with Deloitte. This short-term procurement approach is unsuited to a multi-annual project on the scale of PPARS.
"While annual estimates were produced, there was no definitive overall budget extending over the life of the project which linked money to deliverables," the report said.
It also criticised the lack of accountability and control structures and said the project management team did not have sufficient authority. There was a lack of 'buy-in' among some agencies, it added.
"This was further exacerbated by the often patchy pattern of attendance and the frequent changes to personnel attending board meetings."
Mr Purcell's report did find that: "Apart from the not inconsiderable benefit deriving from the computerisation of personnel records there are a number of key achievements that can be built on."
Tánaiste and Minister for Health Mary Harney said a number of "classic mistakes common to such projects in both public and private sectors were made".
She conceded: "The health service management did not have the internal capability to manage this complex project without an over-reliance on external consultancy resources."
She said it was regrettable that public procurements procedures were not properly observed but that lessons would be learned for other public service IT projects.
She announced new arrangements for major public service projects and said the conclusions of the C&AG report would be followed up.
The Health Service Executive (HSE) is due to make a decision on the future of the system early next year. In a statement this afternoon, it said the decision to suspend work on the system was justified by today's report.
"PPARS was not designed to meet the needs of the unified HSE structure. It was designed to make sure that each former Health Board had a common HR management system yet could continue to operate independently," the statement said.
It said the "substantial variations in pay and conditions, organisational structures and processes across the former health boards" was one of the reasons for the problems.
"The unified and national nature of the HSE will ensure that many of the issues faced by the PPARS Project, with regard to leadership and authority, will not be repeated in future projects of this nature," the statement said.
The report will be put before the Oireachtas next week.