[LINK] Federal Government to review all major IT contracts: “ABS put too much faith in IBM”

Stephen Loosley stephenloosley at outlook.com
Tue Feb 28 14:38:52 AEDT 2017

Federal Government to review all major IT contracts

Review will look at all significant IT contracts worth more than $10 million. “ABS put too much faith in IBM”

By Leon Spencer (ARN) 17 February, 2017

The Federal Government is set to review all of the significant IT contracts it has with its external providers as part of a new drive to deliver greater transparency of projects funded by its $6.2 billion annual tech spend.

The move will see a special office within the Government’s Digital Transformation Agency (DTA) review all non-corporate Commonwealth entities and all active projects over $10 million in value or those that engage a large number of Australians.

This will see it investigate contracts similar in scale and nature to the deals behind IBM’s management of the Australian Bureau of Statistics’ 2016 Census portal project and the Australia Taxation Office’s engagement of Hewlett Packard Enterprise (HPE) for its storage infrastructure – both of which ultimately ran into far-reaching technical issues.

It is understood that the DTA’s Digital Investment Management Office will review up to 100 IT projects from now until mid-2017, in a bid to deliver greater transparency around many of the government’s larger-scale IT projects.

The DTA is expected to deliver a report on the review to the government by mid-2017 on the costs, benefits, risks and the status of the initiatives associated with the projects in question

"The DTA will ensure we're investing in the right technology projects, we can track their implementation, and know they will deliver on the public policy benefits they promise," Assistant Minister for Digital Transformation, Angus Taylor, said in a statement.

"This is more than a review, its ongoing oversight, and it will provide unprecedented visibility and centralised management of IT projects," he said.

One of the key capabilities of the expanded DTA will be to target technology assistance to government departments and agencies, and remediate projects.

"We can always do better - better impact for government by doing more with every dollar and better impact for citizens by providing easier-to-use services," he said.

The creation of the Digital Investment Management Office, which is headed up by former Department of Finance Assistant Secretary (Investment, Capability and Assurance Branch), Andrew Woolf, comes four months after Taylor flagged plans for a new program management office.

On 28 October 2016, as the Government’s Digital Transformation Agency arose out of the former Digital Transformation Office, Taylor announced the new agency’s agenda, revealing that it would manage a whole-of-government ICT program management office, which would oversee all “significant” ICT and digital investments.

The move to review the Federal Government’s IT contracts comes after a series of high-profile mishaps arising from IT contract arrangements stuck between government entities and external IT providers.

Most recently, Hewlett Packard Enterprise (HPE) has been involved in a drawn-out effort to mop up the fallout of a major storage infrastructure failure and subsequent systems outages at the Australian taxation Office (ATO).

Since the initial outage, which struck on 12 December, 2016, until early February this year, the ATO intermittently took services offline as it worked with HPE, one of its IT contractors, to replace the failed 3Par storage hardware – which had been upgraded in 2015 by HPE – and restore systems to full capacity.

The outage and the resulting efforts to rectify the technical issues subsequently prompted the ATO to engage PricewaterhouseCoopers to conduct an independent review of the incident, while HPE also undertook an internal investigation over the matter.

Earlier last year, it was IBM that was entangled in a high profile technical mishap, with the online 2016 Census project it was contracted by the Australian Bureau of Statistics (ABS) to lead, taken offline after being hit by a series of Denial of Service (DoS) attacks.

That event saw IBM representatives face questions during a parliamentary inquiry into the problems that plagued the portal on Census night.

It also saw the external IT services provider subsequently make a "very substantial financial settlement," according to Prime Minister, Malcolm Turnbull, in relation to the estimated $30 million price tag that resulted from the fallout 2016 Census debacle.

“ABS put too much faith in IBM," Turnbull said in November last year.


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