Gershon Review still posing questions for Feds


As if rising from the grave, the findings of the 10-year-old Gershon Review of the Australian Government's Use and Management of ICT (the Review) became the topic of a Senate Hearing recently, serving to remind how little has changed in some areas, particularly the use of ICT contractors.

Released on 16 October 2008, the Review was headed by Sir Peter Gershon, who had conducted an almost identical review of the UK Government’s use of ICT. It was commissioned by then Finance Minister, Lindsay Tanner.

Gershon recommended a series of measures to help derive savings and improve ICT management. These were endorsed in full by the Government in November 2008 and its recommendations fell to the Australian Government Information Management Office (AGIMO) to operationalise.   

Among the Review’s key findings were the weak governance of “pan-government issues related to ICT”; an inordinate reliance on ICT contracting; “a disconnect between the stated importance of ICT and actions in relation to ICT skills”; and an “ineffective and inefficient” government ICT marketplace.

The advent of technologies unimagined then, including cloud computing and “the rotation to digital” has shifted the public sector focus away from some of the issues raised by Gershon towards an agile operational model that focuses on people’s needs and “solving the problems of users”, said DTA’s Chief Digital Officer Peter Alexander in response to the Senate inquiry on the digital delivery of government services.

“The challenge in any technology-led review is about principles and the market moving on and shifts and changes in the markets,” said Alexander. “For its time, it [the Gershon Review] was a very significant and important report, but the world has moved on.”

The world may have moved on, but some findings of the Gershon Review have retained contemporary relevance.

ICT governance: a perennial issue

According to Gershon, “[t]he lack of a vehicle for political leadership and weak governance of pan-government issues related to ICT, coupled with agency autonomy with regard to ICT investments, has led to significant fragmentation and duplication” of ICT across the government.

“Overall, there is no strong line of sight between agency ICT activity and whole-of-government priorities,” stated the Review. “Furthermore, the current governance arrangements allow agencies to opt into whole-of-government ICT initiatives on a self-approved basis as though they were independent entities who did not rely on funding by the Australian taxpayer.”

This issue was revisited as recently as August 2017, with the newly-formed Digital Transformation Agency’s ICT Procurement Taskforce report noting that “[t]here is currently no comprehensive, coordinated and whole-of-government approach to ICT procurement”.

“Instead, the current system is fragmented and largely decentralised. This results in significant duplication across agencies, identified as a contributing factor in major ICT failures,” states the report.

The Taskforce stated that “the establishment of the DTA in October 2016 with a significantly expanded remit will address many of these issues.”

At establishment, the DTA was given responsibility by the Government to manage all existing ICT policies and standards, sourcing arrangements and procurement guidelines, as well as oversee key projects and encourage greater collaboration.

Since then, it has released the government’s first-ever Digital Transformation Roadmap outlining its agenda for the next 18 months, announced a review of all major ICT projects, and began expanding the Digital Marketplace with new products and services. 

The Agency has also focused on expanding the number of WofG ICT coordinated procurement arrangements, including with major ICT vendors SAP, IBM and Oracle with the intent of making government procurement practice more efficient.

When questioned about the current state of WofG ICT governance during the Senate inquiry, Alexander stated that “delivering cultural and other change is still a challenge, but I think the governance is sound.”

Gershon’s criticism of too much agency autonomy in ICT procurement remains an issue, due to the Westminster system of government which creates Ministerial and agency accountabilities to Parliament and thus creates a siloed focus on delivering to these lines of authorities. 

Achieving the right balance in an environment of such decentralised autonomy will remain difficult. Seeking to strike the right balance, the Taskforce suggested that “[t]here are some digital technologies that should be developed and deployed by a coherent, central program, while others are best managed in a decentralised model.”

Given there was little headway on this over the previous 10 years, the Taskforce’s recommendation of aiming for “targeted recentralisation” of ICT responsibility is likely to be a long-term project, even though some stronger signs of cooperation are now emerging under the DTA than under its predecessor, the Digital Transformation Office.  

Such cooperation has been brought about by the transfer of responsibilities such as delivering whole of government (WofG) platforms to the DTA, accompanied by substantial funding, enablers which the DTO, like AGIMO before it, never received.

A WofG ICT strategy – scheduled to be released in the next few months – is expected to provide some much-needed direction on the balance between decentralised and centralised ICT activity.

ICT capability and labour hire contracting: ongoing efforts needed

The Gershon Review also found “a general lack of strategic planning for ICT workforce capability at both the agency and whole-of-government level”.

Warnings of ICT skills shortage in the public sector were being made even before the Review was tabled. It attributed the problem to “a lack of professional career structures for ICT professionals in the APS”, as well as “a heavy reliance on contractors, who represent 23% of the total current ICT workforce”.

Gershon recommended that the Government “[r]educe the total number of ICT contractors in use … by 50% over a 2-year period and increase the number of APS ICT staff”.

When questioned during the Senate hearing on the number of external ICT contractors in the intervening years, the DTA took the question on notice and tabled a response that “[t]he DTA does not collect this data … such a data collection would require significant effort across agencies, and would carry caveats making it difficult to use for reliable decision-making.”

There is considerable evidence that in the face of this skills shortage, it has proved almost impossible to prevent the burgeoning use of ICT contractors.

The 2017 Taskforce report echoed the Gershon Review’s concerns about lack of APS ICT capability. According to the Taskforce, “[t]he Australian Public Service Commission’s State of the Service Report 2012–13 report found that 47 per cent of agencies reported having skills shortages in ICT procurement, while 69 per cent of agencies reported having an overall ICT skills shortage.”

The Department of Finance’s Australian Government ICT Trends Report 2015–16 (the last in the series) reported similar findings, indicating that a third of the 14,000 ICT personnel employed by the APS were contractors.  Further, the ICT Trends Report show that over the past five years the share of external ICT personnel has increased, and at the same time the number of internal ICT personnel has dropped.

According to Intermedium’s analysis of AusTender posted contracts, the total contract value (TCV) of the Federal Government’s use of Labour Hire peaked in 2015-16 at $1.43 billion, and has remained above $1 billion since.

Efforts are underway to upskill the public sector, however. Building digital capability is a principal component of the DTA’s remit. Upskilling efforts kicked off last year with a suite of ICT Entry-Level Programs, which are aimed at equipping agencies with the skills and resources required for the future.

More recently, the DTA partnered with the Australian Public Service Commission (APSC) to select a supplier to help design and deliver a leadership program aimed at helping senior executives champion digital transformation in their agencies.

Issues in ICT governance and skills will be an ongoing challenge, as recognised in the Senate hearing by Randall Brugeaud, who stood in as the acting CEO of DTA while Gavin Slater took a brief leave of absence to study at Harvard.

“I suspect the recommendations that were made by Sir Peter Gershon will still be relevant in 10 or 20 years time, I just don't think it's ever necessarily fixed,” Brugeaud told the Senate. “I think there are always going to be challenges in relation to skills. I think there are always going to be challenges that government faces in the range of areas that Sir Peter outlined in his recommendations.”

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