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Telco ‘as a service’ favoured in NSW

by Michael Read •
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NSW should source telecommunications as-a-service to provide the government with the best value for money, according to William Murphy, Deputy Secretary, Service Innovation and Strategy Division at the Office of Finance and Services (OFS).

“Telecommunications procurement is a particular priority at the moment in light of the significant annual spend across government… [The ICT Procurement and Technical Standards Working Group] aims to ensure proposed telco contracts provide the best value for money to meet agency needs and the objectives of relevant government policies”, Murphy told Intermedium.

He said that “Telecommunications should be sourced ‘as a service’ to meet business outcomes, rather than focusing on specific technologies.”

Echoing Murphy’s sentiment is Fire and Rescue NSW CIO Richard Host who believes that agencies are becoming much more active in their use of the internet to make savings on telecommunications services.

“Up until now the large telecommunication companies have…not provided discounts if an agency doesn’t give them their whole business”, Host told Intermedium in an interview earlier this year.

“But now that we can…procure [internet services] from different organisations depending on where we are or what suits us. We can now turn the tables.”

Tempering Host’s view is a recent report by the NSW Audit Office which found that there still needs to be more collaboration on telecommunications procurement between agencies and the ICT Board to deliver greater savings.

“We found that, regardless of the State procurement model, the main determinant of whether agencies achieved value for money is how they managed their procurement processes, contracts and expenses”, said the report.

“Our conclusion is that most of the agencies we reviewed do not have the level of expertise in procurement, contract management and expense management that is needed in the fast-changing telecommunications area to achieve value for money.”

In response to the audit’s findings, the NSW Procurement Board issued a direction in July 2014 to NSW Government agencies requiring them to forward any proposed new telecommunications agreements valued at or over $100,000 for review by the ICT Board’s Procurement and Technical Standards (PTS) Working Group.

The PTS Working Group will help agencies make more informed procurement decisions through its knowledge of product offerings and pricing standards in what the Direction describes as an “increasingly contestable telecommunications market”.

A spokesperson from the OFS told Intermedium in June that NSW was “positioning itself to get the best value for money from spending on telecommunications” through:

  • Implementing the Statement on the Promotion of Competition, requiring agencies to apply procurement practices in a manner which promotes competition. This includes assessing the market before rolling over contracts and encouraging new entrants to apply for government work;
  • Increasing competition for NSW government contracts through the ICT Services Scheme; and
  • Achieving greater value for money across agencies through the PTS Working Group. The Group’s cross-agency approach is expected to identify benefits for government and a consistent engagement with the market.


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