Calls mount for reform in Australia's ICT procurement policy

A new report has urged immediate reforms to Australia's Government ICT procurement policy to better support local industry and align with international practices.

The analysis, conducted by Insight Economics, highlights recent steps by the Albanese Government, such as promoting local R&D, intellectual property, tax, and skilled job creation, as positive but insufficient, suggesting these cannot be the culmination of reforms.

Significantly, the report points out that Australia's principal trading partners, including the US, Canada, and the UK, have been more proactive in using procurement to strengthen their own technology sectors. These countries perceive their ICT industries as integral to national self-reliance and economic progress. By contrast, Australian tech firms find themselves in a precarious position, potentially over-reliant on foreign supply chains, a vulnerability exposed by the Covid pandemic.

The report's findings have garnered support from prominent Australian tech companies like TechnologyOne, Vault Cloud, Macquarie Technology Group, Agile Digital, DroneShield, Gilmour Space, Psithur, and the Australian Computer Society. These entities advocate for a structured approach to procurement evaluation and measurement.

Key recommendations include employing a weighted scorecard for smaller contracts, a transparent value assessment calculator for medium-sized deals, and mandatory economic impact assessments for ICT procurement exceeding AUD $10 million, akin to practices in other industry sectors.

Ed Chung, CEO of TechnologyOne, expressed: "Australian tech is world-best and has shown it can compete and win in every market in the world, but continually finds itself fighting for recognition and respect with Governments at home. All we are asking for is that our contribution is properly valued before taxpayers' money is spent supporting the pension funds of people in other countries."

Josh Griggs, CEO of the Australian Computer Society, stated: "ICT continues to be the defining enabler of Australia's economic growth, yet our highly sophisticated and world class technology sector is not adequately prioritised by government procurement processes. It's time to give Aussies businesses a fair go so we can all share in the benefits of a truly advanced, high tech 21st century economy."

Angus Bean, Chief Technology Officer at DroneShield, remarked: "When we empower Australian sovereign companies, we drive locally led research and development, enabling Australian engineers to lead the forefront of technological advancement. For companies like DroneShield, a world-leading innovator in counter-drone solutions, this support not only strengthens our capabilities but also fosters growth in opportunities for emerging talent from our Australian university pipeline, building a skilled, future-ready workforce right here in the heart of Sydney."

Rupert Taylor-Price, CEO of Vault Cloud, commented: "Our allied national security partners are very clear on what control and economic benefit they require when deploying their taxpayer's funds - they see it as part of their patriotic duty. This paper provides a rational and evidence-based path forward for Australia to join our allied partners in building a secure and resilient country."

Felix Barbalet, co-founder of Psithur, noted: "Australian ICT companies are producing world-class innovation. By adopting smarter procurement practices, the government could leverage local expertise to deliver better services and value to all Australians while contributing to economic growth and high-skilled jobs."

David Elliott, Executive Director at Agile Digital, observed: "As the cost of living crisis continues, Australians are questioning why so much time and taxpayer money goes into large, often unsuccessful Commonwealth ICT projects. As a country, we need to rethink awarding massive ICT contracts to multinational companies and consider turning to our local industry instead. This report from Insight Economics urges policymakers to learn from our trading partners – and to consider the benefits Australia could gain if our Government were more strategic, focused, and sovereign in its ICT procurements."