ATO sticks with DXC, despite outages

Extends outsourcing agreement with DXC until 2019

The Australian Taxation Office has extended its centralised computing contract with DXC Technology until 30 June 2019.

The original five-year contract, which covers a range of services including data warehousing, mainframe,  storage, data centre facilities, private cloud and public cloud, was signed with HP Enterprise in December 2010 and commenced in July 2013.

DXC has been responsible for the delivery of services covered by the contract since it formed in April this year out of the merger of HP Enterprise’s services arm and CSC.

The HPE/DXC contract with the ATO has been subject to scrutiny following a number of major service outages at the agency.

The failure of an HP Enterprise 3PAR SAN, owned and operated by HPE on behalf of the ATO, was at the heart of a string of outages beginning in December 2016.

Shortly after the December 2016 crash of ATO systems, Commissioner of Taxation Chris Jordan described it as the agency’s “worst unplanned system outage in recent memory”.

It was followed by another major outage in February. And then another in February.

Earlier this year the ATO rolled out a replacement SAN.

A review concluded that there were a number of warning signs in the lead-up to the December outage.

Logs over the six month period before the outage reveal potential problems with the SAN that were similar to those that led to the December outage.

“A number of the ATO’s IT contracts are due for renewal in the coming year,” an ATO spokesperson said today.

“Many of these contracts have been in place since 2009/10 and the market and government IT procurement policy has changed over that time.

“In consultation with the Digital Transformation Agency we are revising the way we would use these services to be in line with government policy.”

The agency said that it would be extending some services delivered by incumbent suppliers in order to allow proper consideration of the options available.

“We expect to finalise our new IT sourcing strategy in 2018 and, as part of this, we will progressively extend some services currently offered by incumbent suppliers to ensure continued stability of systems while we approach the market for services,” the spokesperson said.

The contract extension is worth up to $195 million, bringing the total value of the contract to $1.47 billion, AusTender documents reveal.

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