Tanner: Gershon savings to hit $1 billion in 4 years

Federal Government agency efforts to improve their use of ICT as part of Gershon Review changes will result in savings of more than $1 billion over the next four years, Minister for Finance and Deregulation Lindsay Tanner has claimed.

In a statement, Tanner said the second round of the business as usual budget reduction program had been completed with "savings of close to $430 million identified between 2010-11 and 2012-13".

"In his independent review of the Government's use of ICT, Sir Peter Gershon noted that savings of around $1 billion could be achieved over four years by reducing agencies' business as usual ICT costs," Tanner said in the statement.

"In April this year, phase one of the program was completed with savings of approximately $570 million being identified. The completion of the second phase of this program means the savings foreshadowed by Sir Peter Gershon have now been realised."

In his report that was made available in October last year, Gershon slammed the Australian Government's use and management of ICT as weak while making seven main recommendations:

• 1. Strengthen pan-government governance
• 2. Strengthen agency governance
• 3. Tighten the management of ICT business as usual funding
• 4. Enhance the management of the public service ICT skills base, including reducing the number of contractors by 50 per cent
• 5. Develop a whole-of-government data centre strategy
• 6. Improve the efficiency and effectiveness of the ICT marketplace
• 7. Improve the sustainability of ICT use

The first recommendation involved, among other things, the setting up of the Secretaries' ICT Governance Board (SIGB), which has been completed and operational for some time overseeing the rollout of Gershon changes along with the Australian Government Information Management Office (AGIMO).

Tanner also recently announced a panel of data centre providers to service Federal Government agencies while they develop the whole-of-government strategies. Polaris Data Centres, Canberra Data Centres, Fujitsu, Global Switch Property and Harbour MSP were selected.

In October, Computerworld reported that Federal Government agencies are likely to adopt a self-assessment tool created by the UK Office of Government Commerce to evaluate their ICT capabilities within the month as part of Gershon Review changes.

The P3M3 (Portfolio, Programme and Project Management Maturity Model) tool has already been piloted by four agencies -- the Australian Bureau of Statistics (ABS), CrimTrac, Geoscience Australia, and the Department of Education, Employment and Workplace Relations (DEEWR).

In August it was announced the BAU changes had created $109 million of savings in the 2009/10 financial year. Half of that figure ($54.6 million) was to be immediately available for reinvestment by Federal agencies. The Government also signed a Volume Sourcing Arrangement (VSA) with Microsoft in February, a move that AGIMO claimed will provide an average savings of $15 million a year over four years.

Additionally, the Federal Government previously announced it will create whole-of-government purchasing panels and contracts for desktops and telecommunications equipment and services.

The first of the new panels and contracts is expected by the end of this financial year. It will involve "desktop computing equipment, telecommunications invoice reconciliation services and Internet-based network connections".

More information on the Federal Government's ICT reform program can be found here.

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