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Government cuts tech spending by $300 million: report

Government cuts tech spending by $300 million: report

ICT makes up less than 10 per cent of total government spending

The Australian government has cut spending on technology products and services by $300 million between 2010 and 2012, according to a new report from the Department of Finance and Deregulation.

The <i>Analysis of Australian and Overseas contracts by the Australian Government</i> (PDF) report, which examines contracts worth more than $10,000 reported on AusTender, shows the total value of IT, broadcasting and telecommunications dropped by $300 million from $2.9 billion during 2010-11 to $2.6 billion during 2011-12.

Engineering, research and other technology-based services also dropped by $300 million from $2.1 billion to $1.8 billion over the period.

The government spent $32 billion in procuring contracts carried out by Australian suppliers in 2011-12, representing 78 per cent of the Commonwealth’s total procurement market of around $41 billion.

ICT represents about 6.3 per cent of the total spend, with communications technology making up 2.2 per cent. Software made up almost 40 per cent of ICT spending at $948 million, while communications devices and accessories made up a quarter at $638 million.

Mobile communications services (about $11 million) and mobile phones ($4.4 million) came last on the list of government ICT procurement costs.

Minister for finance and deregulation, Senator Penny Wong, said in a statement that the “Gillard government is committed to helping Australian businesses through our procurement market, supporting jobs and enabling a strong and competitive Australian economy”.

However, ICT makes up less than 10 per cent of total government spending, indicating that it’s not a high a priority.

The digital economy in Australia is expected to grow from $US44 billion (3.3 per cent of GDP) in 2010 to $US67 billion by 2016.

Follow Rebecca Merrett on Twitter: @Rebecca_Merrett

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Tags IT spendingIT procurementgovernmentDepartment of Finance and Deregulation

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