Cobra only bidder for Dataprev IT tender

Brazilian IT services firm Cobra Tecnologia was the only bidder for a contract to manage the systems and equipment for Dataprev, the data processing company for Brazil's Social Security National Institute (INSS), Dataprev said in a statement. Dataprev is examining Cobra's technical proposal for the 36-month contract, and if it accepts the documents, will proceed with opening the financial bid, probably by the weekend, Dataprev said. Dataprev has three major systems to handle INSS needs: the first, based in Rio de Janeiro, handles 9bn reais (about US$3bn) a month of payments to 21.9 million Brazilians in the form of pensions, unemployment, health and maternity benefits, among others. The second system, based in Sao Paulo, collects benefit taxes from 27 million companies and individuals. The third registers all labor contracts signed in Brazil since 1996, and is used to verify payouts and to prepare the government's single register for benefit payments. All three systems are currently run on proprietary platforms of US IT firm Unisys (NYSE: UIS), which has been handling Dataprev's systems for more than 30 years. The payments system uses a Unisys Libra computer, while the collection and CNIS systems use 5-800 mainframes. Dataprev signed the last four-year contract in mid-1999, but it subsequently fell into legal disputes brought by the federal public ministry, the attorney general and Dataprev itself amidst allegations that Unisys was overpaid by 200mn reais. When the new Dataprev administration took charge in January 2003 as a result of the election victory of President Luiz Inacio Lula da Silva, it discovered that with six months to run on the contract it had little time to resolve the problems, a Dataprev spokesperson told BNamericas. No new investments had been made in five years and systems were running at nearly 94% of capacity, which meant delays for the 1,200 INSS branches trying to access data, he said. The legal disputes with Unisys pushed the new Dataprev management to seek help from other government companies, including the senate data company, Prodasen, and the justice ministry's Serpro. The only one that offered a solution was Cobra, linked to Banco do Brasil, and it was hired under a six-month temporary contract as it prepared the current tender, the spokesperson said. Simultaneously, the welfare ministry has been working with the United Nations Development Program (UNDP) to end the reliance on Unisys proprietary platforms and move to open source systems, the official said. US-based International Business Machines (IBM) (NYSE: IBM) has been selected for the contract to migrate the collection system to its Risk platform, while Unisys has been selected to migrate CNIS to its Storage platform, the spokesperson said, adding that the contracts are still subject to the final UNDP seal of approval. The collection system should be migrated in 12 months, while CNIS should be ready in 24 months' time. As each unit comes online, the operator of the old systems - namely Cobra if its bid is successful - would hand over responsibility to the new operator, either IBM or Unisys. Welfare minister Amir Lando has created two working groups to analyze the existing migration programs with a view to tendering a contract for the benefits payment system. This is by far the most sensitive system, as any problems result in delays to payments to 21 million people, "which can bring down a government," the spokesperson said.