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Will IT projects fall foul of Queensland’s tough September Budget?

by Paris Cowan •
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Queensland Premier Campbell Newman has pushed his first State Budget back to 11 September to give his new ministers time to scrutinise all corners of the public sector to find the savings he promised in the lead up the election.

“I’ve urged all ministers to continue to look day after day, week after week in the coming months at every single possible way they can save money,” he told journalists at a press conference earlier this month.

While it will not be clear until the Budget is handed down whether any IT projects will become casualties of the savings drive, the Queensland LNP has been vocal in its criticism of a number of Labor-commenced initiatives in the past.

The then Shadow Minister for Technology Ros Bates accused the Labor Government of wasting “millions of hard working Queenslanders' taxpayer dollars” in January 2012, when it was revealed that the Queensland Treasury Corporation (QTC) had terminated a $7.5 million contract for the installation of the Temenos platform, and had decided to go ahead with an internal build.

The LNP has not made any comment on the future of the internal QTC build since forming government.

In December 2011, Bates also criticised Labor’s Identity, Directory and Email Services (IDES) project, which aimed to establish a whole-of-government user-identity management system, with a single sign-on allowing access to a range of applications, including email.

She said that at $46 million, the IDES project was costing the Queensland Government $23,000 for each of the 2,000 users that had been registered. The IT Minister at the time, Simon Finn, replied that this was just a starting figure, and that 53,000 users were due to be migrated across by the end of 2013.

However, with this project already at the migration stage, it is probably too far into implementation to be able to offer any significant savings through cancellation.   

Having already emulated the NSW Coalition by postponing its first Budget to September to allow it time to take stock of the financial situation, it is quite possible that the Queensland LNP will also look to the O’Farrell Government’s savings strategy for inspiration.

O’Farrell’s first Budget centred around an $8 billion savings drive, to be made up of $6 billion from an efficiency dividend applied over four years; $800 million from axing ineffective projects; and $1 billion from procurement reform.

Procurement reform may well prove an attractive option for Newman, who has promised that there will be no forced redundancies under his scheme.

In 2010-11, the Department of Public Works reported that the Queensland Government had saved a $3.2 million through the use of whole-of-government ICT procurement panels, and another $3.5 million from the consolidation of internet service providers across Government.  In comparison to savings claimed in other jurisdictions such as NSW, and also the Federal government, these savings are inconsequential, and suggest scope for moving more aggressively in this direction.

The establishment of a Queensland whole-of-government IT Services Panel, matching those in place in NSW and Victoria, is being contemplated and a decision on this is likely from the new Government only after it has determined the ways in which it will make its savings.

Despite Newman’s eschewal of involuntary staff cuts, the Queensland public sector has been growing at a faster rate than the rest of its population for at least seven years, according to data from the State’s Public Service Commission.  An analysis of data from the Australian Bureau of Statistics (ABS) contained in the NSW Schott Report reveals that Queensland public service numbers increased steadily between 1983 and 2006, while NSW fluctuated to a relatively minor degree and Victoria had a dramatic decline.

Queensland’s public servants constitute 7 per cent of the State’s population.  The ratio is six per cent in NSW and Victoria, according to ABS data from June 2011.  While the gap might seem minor, it actually means that the Queensland Public Service employs approximately 27,400 staff over the Eastern Seaboard per capita average. At an annual FTE average salary of approximately $60,000, reducing the public workforce by this figure would save the Government more than $1.6 million per annum.

As with other jurisdictions, any staff saving targets, if and when they come, are likely to be in the ‘back office’ rather than the frontline teaching, nursing and policing functions.

Despite its emphasis on savings, the 2011-12 NSW Budget contained significant ICT funding and this is likely to be the case also in Queensland’s September budget as ICT is fundamental to government operations and large reductions in Operational Expenditure, which will be almost impossible to achieve unless radical changes are made.    

The Queensland whole-of-government CIO, Peter Grant, has previously stated that he is supportive of ‘bring your own computing’, cloud services and the use of social media as means of reducing computing costs in government. 

Newman has already launched his own investigation into the works being undertaken to remediate the Queensland Health payroll system failure, the findings of which may result in additional funding.

Related Articles:

Queensland Government gets a new ICT department

What will Campbell Newman’s public sector look like?

Queensland Government approaches the market to renew dramatically expanded hardware panel

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  • QLD
  • IT Services
  • Policy
  • campbell newman
  • Identity
  • Directory and Email Services (IDES)
  • LNP Government
  • Peter Grant
  • QLD Budget 2012-13
  • Ros Bates
  • Temenos platform