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Report of the ICT Procurement Taskforce
The Australian Government’s annual spend on Information and Communications Technology (ICT) goods and services is significant and is comparable to its spend on a large social welfare program, such as the Newstart Allowance.
In 2015–16, Australian Government agencies reported that they spent $6.2 billion on ICT goods and services. In that same year, agencies estimated that they would procure $9.0 billion of ICT goods and services into future years across 17,000 contracts.
The bulk of this ICT procurement will be undertaken by just a handful of agencies. In 2015–16 six agencies — Defence, Human Services, Immigration, Foreign Affairs and the Australian Taxation Office — accounted for 76 per cent of the value of Australian government ICT procurement, with another 99 agencies responsible for the remaining 24 per cent. Likewise, a small number of very large and long procurements will drive almost half of total commitments. In 2015–16 the 100 biggest procurement contracts had a value of $4.1 billion, or 46 per cent of the total value, with the remaining 17,000 procurements making up the other 54 per cent.
ICT procurement activity is carried out in a devolved environment, where agencies are largely responsible for their own processes and practices. This has been the case since public sector reforms of the late 1990s. The Commonwealth Procurement Rules (the CPRs) set out principles and rules with which government agencies must comply when procuring goods and services. However, the implementation of the CPRs is at the discretion of individual government agencies, and formal and informal processes for ICT procurement can differ markedly from agency to agency.
The taskforce’s consultations revealed deep dissatisfaction of almost all parties involved in current government procurement practices and processes.
Government agencies told the taskforce that they find procurement processes outdated, cumbersome and unable to meet their needs. They are concerned that they are being left behind in adopting new and innovative technologies to deliver services.
