Media reports about the threat posed to AGIMO’s future by Labor’s intended reallocation of the Gershon reinvestment funds reflect a lack of understanding of AGIMO’s current responsibilities says Intermedium Director Judy Hurditch.
“While there may have been a range of ongoing functions related to managing the Gershon reinvestment activity, these are by no means the full span of activity for AGIMO. Many of the Gershon recommendations, such as coordinated procurement are likely to continue as a direction for a re-elected Labor Government, even without Lindsay Tanner’s championing,” she said.
“What a newly elected Liberal Government will chose to do with the implementation of the full raft of Gershon recommendations is as yet unclear”, she added.
An Australian Financial Review report published on Friday 6 August alleged that the removal of the money quarantined for measures in line with the recommendations of the Gershon Review would leave AGIMO without “any influence over what had been flagged as a pipeline of innovative future technology projects aimed at modernising the public service”.
While the elimination of the Gershon reinvestment fund will undoubtedly have a profound impact on the ICT market in coming quarters, the central coordination role played by AGIMO is likely to remain an important element in the management of government ICT.
The speculation over AGIMO follows the announcement by the Gillard Government on 31 July that it will remove the $447.5 million in funding quarantined under the Gershon reforms for spending on Federal Government ICT.
The Gershon reforms were targeted to achieve $1 billion in ICT BAU budget savings, of which half was to be reinvested in programs to further improve ICT efficiency in the Federal Government.
The 2010-11 Federal Budget had included the first tranche of ICT projects to be funded from the Business-as-Usual Reinvestment Fund and on 18 May, Finance and Deregulation Minister, Lindsay Tanner announced that a total of 44 projects worth $230 million would be funded from the reinvestment fund. The status of these projects is now unclear.
The Costing Request submitted to the Department of Finance and Deregulation on 2 August,indicated the Government expects to achieve the $447.5 million worth of savings over four years, with savings of $39.7 million anticipated in 2010-11, $117.7 million in 2011-12, $113.5 million in 2012-13, and $176.5 million in 2013-14.
The request also indicates that the Secretaries’ ICT Governance Board formed to oversee the implementation of the ICT Reform Agenda will be retained, and costs associated with the committee will be met by Departments.
The ICT projects that were to have been funded through the Gershon reinvestment will now have to find alternative sources of budget funding or they will be unable to go ahead.
Departments still intending to proceed with these projects will now have to rebid them in a future budget funding round, with redeveloped business cases which can show how there will be offsetting savings for the cost of the projects.
The $447.5 million of the Gershon savings that had been earmarked for reinvestment will instead be used to return the budget to surplus.