Does this come with the alarm system

No, It does not come with an attached alarm you would have to buy the HP-60A. It does have a side port that a provided air barb goes in. This is for a 3/8 air hose that runs to the control panel where a pressure switch is located that if activated sets the alarm off.

What is the purpose of this pump?

The purpose of the Hiblow HP60 septic air pump is to provide oxygen for the aerobic bacteria to grow and stay alive. To make an aerobic septic system aerobic it needs air which creates dissolved oxygen for the aerobic bacteria to stay alive without it they would die and the system would be like a standard system that uses the anaerobic process which takes much longer to treat the water and does an effective job compared to an aerobic system. Aerobic systems break down waste much faster and the water that comes out the effluent is much cleaner. This is why they are more and more prevalent now.