A September Budget in NSW will force the state’s ICT vendors to wait an extra three months before any new ICT projects are funded, while in the interimseveral projects established under Labor will likely face the chopping block.
NSW’s new Treasurer, Mike Baird, announced that the annual Budget, which has been released in June in recent years, will be postponed until September to allow a commission of audit to examine state finances.
This could result in a three month dry spell for ICT and other vendors, as they will face a wait of 15 months rather than the usual 12 for the announcement of newly funded initiatives.
Having committed himself to restoring “fiscal discipline” as part of the Coalition’s Five Point Plan, and refusing to rule out budget cuts to cover what he claims is a $4.3 billion hole in the budget, Premier Barry O’Farrell will be on the look-out for underperforming projects and those which smack of Labor political ideology to provide much needed savings.
Intermedium’s budget IT tool shows that 45 new ICT projects were funded in the 2010-11 NSW State Budget, worth a total of $539 million over four years.
At risk projects include the NSW Ambulance Services Technology and Infrastructure Upgrade. According to Budget IT the project is worth $7.19 million in total, but with only $240,000 of that allocated to be spent in 2010-11, it could be seen as an expendable initiative.
The $11.4 million allocated to the Registry of Births, Deaths and Marriages’ ‘LifeLink’ project in the 2010-11 Budget may also become a target for the funding knife. In a December 2010 report, the NSW Auditor General reported that the project was running at more than twice its original budget and up to four years behind schedule.
The substantial pool of $417.4 million which remains to be spent on IT projects at the Sydney Water Corporation may also be culled to achieve crucial savings for O’Farrell’s government.
ICT projects at the Department of Health will also come under scrutiny, following negative reports which surfaced regarding the roll out of the emergency department clinical system, FirstNet. The Coalition Government has given long-serving Director General Debora Picone her marching orders according to The Sydney Morning Herald.
Prior to the election, now Health Minister Jillian Skinner said, "this project has all the hallmarks of another botched Labor project, who can't seem to manage to deliver health infrastructure projects on time or on budget”.
A total of $594 million worth of health ICT projects were outlined in the 2010-11 Budget, of which Budget IT predicts nearly $200 million still remains unspent.
The change of government has already also claimed the job of the Department of Education and Training’s top man, Michael Coutts-Trotter. It now remains to be seen whether the DET is able to retain all the funding allocated to its corporate systems overhaul, the Learning Management and Business Reform (LMBR) project.
Three funded components of this project – an Enterprise Information Management System; Human Resources and Payroll Systems; and the Student Administration and Learning Management System (SALM) – are listed by as being worth a total of $243 million in the 2010-11 Budget, however the breakdown of values for each project was deemed commercial in confidence at the time of the Budget’s release.
The corporate nature of this project may mean that it is deemed essential and work is likely to continue.
The projects should also be well progressed by now, further tying the hands of the Treasury when it comes to funding cuts. The LMBR project has been ongoing since 2008, and the SALM is due to begin its implementation phase in mid 2011. The SAP-based payroll system will be rolled out to TAFEs in mid 2011 and schools in 2013.
While NSW will also have to wait an extra three months before it becomes clear what new ICT projects will be launched and funded by the new government, O’Farrell and his ICT spokesperson Greg Pearce have released some hints about the kind of projects that will emerge.
Funding of $2 million for a Telehealth centre in Penrith has already been announced, and more e-Health funding may follow if the FirstNet emergency department system is not improved to the extent required by Health Minister Jillian Skinner.
The Coalition also plans to establish a 21st Century Neighbourhood watch initiative, an online portal for which will have to be budgeted for in September.
There have also been suggestions that the Coalition is favouring an investment in cloud computing.
The NSW Treasury has informed Intermedium that the 2011-12 Budget is due to be handed down on 6 September 2011.