The Federal Government again affirmed last week that more spending cuts and saving measures will be announced as part of new forward estimates presented in the midyear economic and fiscal outlook (MYEFO). Lindsay Tanner has repeatedly singled out IT as a targeted area for savings.
Since the election, Tanner has reiterated that cuts would be made in a two stage process. The first round began soon after the election and continued through the budget, with cuts to overall agency budgets and specific government programs.
The first round involved easily identified savings. The real issue was always the shape of the stage two cuts, and their potential impact on the ICT market in general. This stage is a much more complex process, and will address long-term issues around the business of Government.
The Government’s midyear economic and fiscal outlook (MYEFO) will be released at the end of the calendar year, probably in early December.
Tanner's latest comments will be interpreted by agencies as requiring care in planning ICT procurements, and will dampen spending.