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ATO to introduce new procurement model alongside panel overhaul

by Sam Murphy •
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The Australian Taxation Office (ATO) is planning to approach the market for a new IT Contractor Services panel under a new procurement model.

According to Intermedium’s AnalyseIT, the ATO has done $124 million worth of business through the panel since its creation in July 2011. Preceding its expiry in July 2014, the ATO will consult with industry about overhauling its current procurement methods.

An Industry Briefing has been announced for 11 April 2014 to discuss the ATO’s IT Procurement Reform Program which is being designed to “make working with the ATO simpler and more cost effective for industry and in return are looking to achieve greater efficiency and cost savings”.

Since February 2014 the ATO has been developing a Procurement Reform Program with an aim to deliver:

  • Improved industry engagement;
  • Greater efficiency in identifying and engaging contractor resources;
  • Enhanced contractor engagement, retention and performance;
  • Enhanced accountability and transparency through the procurement process; and
  • Ongoing, sustained cost reductions.

Following industry consultation, the ATO expects to release a public Request for Information (RFI) for the establishment of a new IT Contractor Services panel. As part of the RFI process the ATO will hold another industry consultation regarding IT Contractor Services. This will be followed by an RFT, with the new panel expected to commence in early 2015.

The Industry Invitation states, “The ATO is the first Commonwealth Agency to undertake such a Program specifically focussed on IT Contractor Procurement. One of the identified critical success factors for the IT Contractor Procurement Reform Program is strong industry engagement.”

The ATO is one of the largest spenders in the Government Labour Hire market. According to AnalyseIT, in 2012-13 the ATO had the third largest ICT Labour Hire spend of any Federal agency with a total contracts value (TCV) of $56.9 million. Approaching Q4 of 2013-14, the ATO has already spent a total of $50 million on Labour Hire.  The majority of this procurement has been done through its IT Contractor Services Panel.

The Australian Securities and Investments Commission (ASIC) and the Telecommunications Universal Service Management Agency (TUSMA) have also done business through the panel. ASIC has accumulated a TCV of $17.6 million since 2011 while TUSMA has signed $339,000 through the panel.

The Agency is currently working towards its 2020 Vision which aims for improved modern services and technology to match contemporary expectations. The Commissioner of Taxation, Chris Jordan told a Parliamentary Standing Committee on Tax and Revenue, that the ATO will “reinvent itself” with a “much more modern digital sort of communication process”.

Its 2020 Vision will be delivered with a significantly reduced workforce. In November, the ATO advised Senate Estimates that it would reduce staff by 900 Full Time Equivalent (FTE) by June 2014.

The ATO worked extensively on procurement reform during 2012-13. According to its 2012-13 Annual Report, the Agency improved procurement and contract management processes by deploying an enterprise procurement system for purchasing goods and services. It also implemented an integrated quality framework “to review procurement quality management processes, procedures and decisions and to identify, prioritise and plan improvement opportunities.”

Related Articles:

The ATO to deliver 2020 vision with improved systems but smaller workforce

Majority of ATO complaints stem from IT problems

Accenture wins $40 million ATO deal

For more information, please contact the Editor (02) 9955 9896.

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  • Federal
  • Labour Hire
  • Finance & Services
  • ATO
  • ATO 2020 Vision
  • ATO IT Procurement Reform Program
  • IT Contractor Services Panel
  • Telecommunications Universal Service Management Agency (TUSMA)
  • The Australian Securities and Investments Commission (ASIC)