ATO IT will stay at home

In what has been a clearly testing week, Australian Taxation Office CIO Bill Gibson has spelled out his vision for Australia's single largest revenue raiser and scotched allegations that the Tax Office is set to move its applications code shop to India.

The ATO will substantially consolidate both hardware, operating environments and application systems to forge a single integrated information environment, Gibson said, when speaking about how the ATO will deliver services through IT in the next five years through a whole-of-agency overhaul known as the 'Change Program'.

"What I see ahead of us is a major transformation in both business processes and technology to support these experiences that we want, and are committed to, for our customers. Our existing systems have to continue to run in parallel for some time with a range of new systems [we are introducing]."

He said the challenge will be to run "business as usual" during the Change Program. "We are a business that is critical and the primary revenue source for the government.

"We also have a responsibility to interact with the whole taxpayer community in a way that is effective for them," Gibson said.

The ATO plans to retire and upgrade a range of now-fragmented and ageing big iron infrastructures, including its IBM Z series mainframe CICS and DB2 systems - some of which are more than 20 years old.

"Over time, you end up with an accumulation of systems that interoperate… but don't present a tightly coupled view. It means operators have to look at two systems to get the complete picture when they are interacting with a customer. Around 2006-07 [legacy systems will] be ultimately decommissioned and replaced by a single integrated system. We have four or five systems we will bring together as one," Gibson said.

Asked about the ATO's sourcing and development intentions, Gibson flatly denied recent reports ATO was planning to offshore saying that vendors would be contractually bound to keep work in Australia.

"It will be a condition of the contract and it will come down to that. If anyone were to do that they would be in breach of contract," Gibson said, adding his experiences with offshoring prior to his appointment at the ATO had proved a mixed bag.

"In previous lives, and not only myself but other large corporations have looked into [offshoring] to see if it is viable. There are tradeoffs. It is very dependent on your pure business circumstances - not just if you have a policy for or against it.

"There are systems definition matters. Then there's the question of how you effectively interact over a telephone to build a computer system. It is difficult to do. Some profiles of applications are suited better to that than others and it has to be weighed up on a case-by-case basis. To say generally that it [offshoring] is appropriate and that you should do it is not a fully considered [outcome]," Gibson said.

A spokeswoman for the ATO was more blunt.

"We won't be setting up shops in India. We have no intention of [offshoring] applications development work," she said.

Gibson said the ATO was also committed to keeping and enhancing its in-house capacity in terms of both IT and business process.

"My personal view is that it is essential to retain that within the organisation. That is the knowledge of how to be effective. To date the ATO has only outsourced commodity processing-type items. We have retained the full design and build of our own applications," Gibson said. ATO's IT chief also made no bones about how he sees the sourcing debate.

"The way we are heading is down a selective sourcing path - which is in fact now more the contemporary thinking than in the 90s, which was 'whole of IT outsourcing'. There is a maturity in our organisation that has occurred as a consequence of being through [wholesale IT outsourcing] experience.

"There's [also] a maturity in the provider landscape as well and in their capabilities to meet our business needs. That's improved," Gibson said.

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