The former secretary-general of the Department of Health, Michael Kelly, has strongly defended the department's role in authorising the development of PPARS.
Mr Kelly told the Dáil Public Accounts Committee yesterday he had estimated the system would pay for itself over a 10-year period even if it produced modest benefits.
He insisted, however, that the department had never been involved in managing the project.
Mr Kelly was speaking at a hearing of the committee into the PPARS computerised payroll and human resources system for the health services.
Initially the system was estimated to cost about €9 million. However, so far about €130 million has been spent.
Asked about the decision of the project management to commission consultants Deloitte on a time and material basis, Mr Kelly said he had no part in this move. He said he would never have signed a contract on this basis.
However, he acknowledged that a fixed-price contract would have had conditions attached which could have resulted in penalty payments.
He said former minister for health Micheál Martin would have authorised expenditure on the controversial PPARS computer programme as part of approval for the overall health service capital programme. There would have been no detailed discussion with the minister on the issue, he said. However, each element of expenditure in the department's overall capital programme was cleared by the minister.
In a report before Christmas, the Comptroller and Auditor General criticised the way the project had been managed and delivered.
Mr Kelly said that when the department agreed to implement the project, he believed it "positively needed to be undertaken". He thought it had to be looked at as a long-term investment that would require a large investment up-front to produce long-term benefits.
"The apparently random approach by health boards and other health agencies to managing and reporting on employment levels continued apace and the case for PPARS in terms of need had become stronger in the department's view by 2002."
Mr Kelly took issue with concerns raised in the comptroller's report on the level of governance of the project.
"It is important to appreciate that the governance structure did not exist in isolation from the Health Board Executive (set up in 2002 to facilitate joint working by health boards).
The lead chief executive for the project, the chief executive in the northwest - had immediate access to each of the other health board chief executives as co-directors of the Health Board Executive. It is therefore difficult to accept an argument that the necessary authority to move things along in individual health boards was inhibited in some way."
