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Government Agencies go Shopping for ICT

by Staff Writers •
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Federal government agencies recently published their procurement plans for the 2007-08 financial year. While they contain a large number of major ICT initiatives, the overall volume of ICT projects is slightly down on last. With the federal government ICT market growing so strongly, it is difficult to understand why the number of ICT items listed in agency procurement plans is down on last year.

Intermedium reviewed the plans posted on 1 July 2007, and identified 404 ICT projects in the procurement plans of 119 federal government agencies. This is down from the 424 published in July 2006.

Under the Australia USA Free Trade Agreement, agencies were encouraged to publish procurement plans to enable the ICT industry to respond fully and appropriately to opportunities. If an intended procurement is not published as early as possible in a procurement plan, it has the potential to reduce the competitive nature of the field and consequentially may impact the value for money result that all agencies look for in a procurement.

Compensating for this, the quality of agency procurement plans has improved, with agencies providing clearer descriptions and more structure in their plans.

In the 2007-08 plans, the largest category of planned ICT procurements is IT Services, accounting for 35% of the ICT items listed. Hardware is next with 26% of planned ICT procurements.

The agency that tops the list with the most ICT entries in their 2007-08 Procurement Plans is the Department of Health and Ageing (DHA). In total, DHA listed 25 ICT items, including internet gateway services, new printers and the provision of financial reporting tools.

The Department of Defence and the Defence Materiel Organisation together list 121 projects in their procurements plans for 2007-08. Of these, only 12 fall into the ICT category. Planned procurements include IT Services - Standing Offer Panel for Contractors; project management & support services; PABX and unclassified and restricted videoconferencing services.

Centrelink lists 13 ICT items in its 2007-08 procurement plan including SAN cards and Unix backup software. Centrelink’s plan is an example of a user friendly procurement plan, with procurements listed by sub-category such as Property, Information and Technology Services and Human Resources.

Another large buying agency, the Department of Immigration and Citizenship (DIAC) listed only 3 ICT items in its 2007-08 procurement plan - telecommunications services, an online recruitment system and the development of training materials for the System for People program. In 2005-06, DIAC’s total ICT contract value was over $213 million.

Despite the slightly slower start, Intermedium expects to see over 500 planned ICT procurements listed this year, in keeping with the volume we saw last year.

A difficulty with this progressive updating of plans is the volume of changes coming through each month. Intermedium noted more than 45 changes per month last year. These included new opportunities, timing changes, deletions and the maturation of planned procurements into tender processes and award of contract. This puts pressure on suppliers to continually monitor the difficult-to-access plans to make sure nothing that might be of relevance to them has occurred in an agency update.

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