2015 budget wrap-up

The budget included a number of top-tier IT transformation programs for government agencies

"The significant investments in ICT by the federal government announced in the budget are to be applauded," according to Gartner’s Asia Pacific head of research Ian Bertram.

"Gartner closely monitors annual ICT expenditure by national and federal governments across the world and the recent trends for declining investment has seen Australia fall to be in the lowest grouping of nations, as a proportion of Government operating expenditure," Bertram said in a statement.

"The consequences include increased risk and a limited ability to benefit from productivity and performance improvements through digital government," the analyst said.

Two of the big-ticket IT-related items revealed before last night's dog and pony show were the $250 million program to upgrade aging IT systems at the Australian Bureau of Statistics and a substantial rejigging of the government's eHealth record rollout.

Last night's announcement featured major projects across a number of agencies and departments, including the funding to implement an ICT system for the National Disability Insurance Scheme and the first stage of the billion dollar overhaul of Centrelink's payment platform.

There is also funding for the implementation of the government's data retention regime.

Another significant IT spend was the $295.8 million over six years for the Australian Secret Intelligence Service, which includes upgrades to ASIS's ICT systems. Immigration walked away with $164.8 million over four years for biometric-related ICT systems, an eGates rollout, and equipment and training for the Australian Border Force.

"The most important news is not just about the money," Ovum analyst Kevin Noonan said.

"This budget contains a welcome focus on strategic IT investment. Gone are the days of short sighted commodity cost-cutting.

Read more: Budget 2015: StartupAUS sees missed opportunities in budget

"Following the hefty cuts to public service numbers in 2014, government staff headcount remains largely comparable to previous years. Headcount is an important indicator for IT activity as it is the primary driver for laptops, desktop support and personal productivity tools. For vendors of such tools, 2015 should be a much more predictable year."

Digital transformation

The budget included significant funding for digital transformation programs, including $95.4 million for the Digital Transformation Office (DTO).

The DTO "will lead the design, development and enhancement of government services, and better link online, telephone and face-to-face delivery channels," said a statement issued by Communications Minister Malcolm Turnbull.

ERP consolidation

One area where the government is hoping to cut costs is [artnid: 574795|an ERP consolidation program]]. It's earmarked to save $31.4 million over two years.

"While there are certainly opportunities to leverage common ERP platforms, the most significant gains here are usually made outside the technology itself – in areas such as employment terms and conditions for HR platforms for instance," Bertram said.

"Greater attention should be given to these before assuming that simply choosing an IT solution can act as a panacea for existing problems."

The government will also push forward on whole-of-government procurement arrangements, which are estimated to save $13.7 million over four years.

Read more: NeCTAR gets $4.9m from government

Startups

Changes supposed to make life easier for small businesses were a big focus of the government's messaging for its second budget. However, although StartupAUS lauded some measures, such as moves to change rules governing the crowd-sourcing of equity, the advocacy organisation said the government had missed an opportunity to strengthen Australia's startup ecosystem.

Tax changes

Revealed the day before the budget were two key revenue measures by the government: A move to address corporate tax avoidance by multinational companies that operate in Australia and the so-called 'Netflix tax' — the extension of the GST to digital goods and services delivered by companies based outside of Australia.

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