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Federal Budget 2011: ICT will continue to ride high on $1b carried over from 2010

by Paris Cowan •
Free resource

Whilst ICT allocations in the 2011-12 Budget are unlikely to reach the dizzying heights of 2010-11, vendors can feel confident that the future is well-funded with unspent allocations from previous years adding to new funding to fill a well-stocked ICT money box.

From the 2010-11 Budget, Intermedium identified a total of $1.8 billion worth of ICT allocations, including the estimated value of the ICT components of non-ICT initiatives.

As Intermedium systematically collates budget provisions into this year’s edition of the Budget IT prospecting tool, first appearances signal that the 2011-12 total will fall below the previous year.

There is, however, no reason for ICT vendors to despair. The 2010-11 edition of Budget IT reveals that only $741.8 million of that allocation was earmarked for expenditure in 2010-11, leaving a little over $1 billion to be spent across the next three financial years.

In addition to this, 2011 also offers a substantial package of new ICT, which should boost industry confidence for the years ahead.

The biggest ICT allocations were handed to the Department of Human Services (DHS) to fund the integration of Centrelink, Medicare and the Child Support Agency. Overall, $569.9 million will be spent on consolidating the ICT functions of these agencies, including:

  • $373.6 million over four years to integrate ICT infrastructure
  • $157.6 million over four years to give customers of the agencies the option of managing all of their accounts online, with a ‘tell us once’ information sharing capability across the portfolio.
  • $38.7 million over four years to transition Medicare, Centrelink and the Child Support Agency to a single website and telephone number for customer access

According to the Budget IT, $146.7 million of this is slated for expenditure in 2011-12, leaving $356.5 million to be spent over the out years.

The DHS was given the green light to go ahead with the integration, which forms part of its Service Delivery Reform program, back in March 2011 when a Senate Committee designated to look into privacy concerns related to information sharing deemed the project safe.

According to documents released in November 2010, the integration of ICT infrastructure will involve the rationalisation of data centre needs, a portfolio-wide common desktop environment based on Windows, the standardisation of corporate applications and the integration of midrange and mainframe infrastructure.

Budget Papers reveals that another $61.4 million will go towards the development of ‘smart’ motorways, including real-time data collection and freight prioritisation.

Many of the projects funded last year are still being implemented, and will continue to provide opportunities in the years ahead.

The biggest ticket item in last year’s Budget was the $466.7 million Personally Controlled Electronic Health Records (PCEHR) system. As the scheduled second and final year of the project, 2011-12 is due to see $281.2 million of this funding spent. However concerns about the viability of meeting this ambitious deadline mean that this funding could be flowing into the market beyond this date.

Continuing budget funding also includes $93.6 million allocation for the Attorney-General’s Department to finish strengthening border security for passengers and air cargo, and another $76.2 million for agencies within Attorney-General’s portfolio to be spent on the completion of the National Security: telecommunications interception capability project.

Intermedium estimates that the Department of Foreign Affairs and Trade (DFAT) also has $84 million remaining in their coffers for the replacement of their existing passport issuance system.

Not all ICT projects have fared so well, however, with budget knives directed towards education initiatives.

Most notably is $132.5 million which will be redirected away from the Digital Education Revolution and another $78.4 million over three years to be redirected away from the Vocational Education Broadband Network, originally developed to provide high speed broadband to vocational education institutions.

Work is currently underway on the 2011-12 Federal Budget IT tool, which identifies each and every ICT allocation in the budget papers, as well as the estimated ICT component of non-ICT initiatives, in a filterable excel spreadsheet.

Following the release of this year’s edition of Budget IT, Intermediumwill hold its annual Budget Briefing, to unpack the key issues of this budget to aid in understanding the strategic implications of budget commitments.

The Budget Briefing will be held on 16 June 2011. 


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  • Federal
  • Treasury
  • Attorney General
  • Budget 2011-12
  • Budget IT
  • DFAT
  • DHS
  • Digital Education Revolution
  • Service Delivery Reform Program