It is clear that the number of NSW Panel contracts is likely to shrink to less than 10 in the very near future.
The NSW Department of Commerce, via its NSW SmartBuy newsletter has provided a summary of NSW ICT State contracts, indicating that this is the likely outcome. Compared with more than 40 ICT related panel contracts back in 2005, this is a significant reduction, but it has not exactly been swift.
The reduction has been achieved by cancelling a number of very specific panel contracts, and consolidating others. Such consolidation and strategic sourcing was first hinted at by Vince Nair just prior to his sudden departure from the Head of State Procurement role in July 2005.
In the latest copy of MIS magazine, NSW Government CIO, Emmanuel Rodriguez is quoted as saying he is “keen to bring together procurement contracts and select the most proficient agencies to take the lead in areas where they have advanced skills or usage requirements”.
Rodriguez is quoted as saying “I’m not going to run the government in a small scattered fashion any more, just to satisfy small companies that might be government suppliers”… “We are going to aggregate supply and base it around the larger agencies so that there is a single instance of SAP at a state government level, for example”.
This is a strong statement, pointing directly to the heart of the tension between the government’s role in industry development, which is taken very strongly in states such as Queensland and Victoria, and government’s obligation to achieve value for money in procurement, by pursuing solutions that meet requirements but at the same time have the best whole of lifecycle cost, and the least risk.
The Newsbuy article reinforces Rodriguez’s statement indicating that by mid 2009, most ICT state contracts will be consolidated into four key suites:
1. IT 2007 for Hardware (Desktops, Notebooks & Servers)
2. Government Telecommunications Agreements (GTAs)
3. Government Selected Application Systems (GSAS)
4. ICT Services - Supplier Panel
Arrangements for Microsoft product, imaging devices and high range servers will be reviewed during 2009/2010 to ensure consistency with the strategic direction of ICT requirements, the Newsbuy article also states.
Coupled with the strategic direction being taken by the Federal Government towards co-ordinated procurement as the result of the Gershon Review, it is clear access to government ICT contracts is going to become even more restricted than it has been in the past. Being on a panel – while still just ‘a ticket to the dance’ - will increasingly be the means by which suppliers find work.