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Government misses 'golden opportunity' for IT industry in budget

Government misses 'golden opportunity' for IT industry in budget

Government has "bigger fish to fry" says analyst

There's not much for the ICT industry to get excited about in the federal budget, unveiled last night, according to Telsyte analyst Rodney Gedda.

"The government has bigger fish to fry than IT in this budget," given that it's likely to be the federal Labor's final term, Gedda said.

"It's going to invest a little bit more in helping small businesses take advantage of the [National Broadband Network – NBN], it's going to invest a bit more in local broadcasting content and satellite services for people. So there are dribs and drabs of IT industry related measures in the budget but it's not really an IT-heavy budget."

Robert Hillard, who leads Deloitte's Australian Technology Consulting practice, said that there was less in the budget than he expected when it came to using technology to deliver savings and better services.

Hillard said that initiatives such as the extra $7.2 million funding to help businesses engage with the NBN are "very, very trivial numbers" in an economy the size of Australia's.

"Far and away the biggest impact a government can have which is not to spend money on investing in business but rather to use its enormous buying power to be able to focus local business and capabilities in the areas that we think we can reasonably compete in a global stage," Hillard said.

Hillard said that the government has missed a "golden opportunity" to help boost innovation in the ICT sector.

"There has been a heavy focus by government on whether global technology companies in particular are paying their fair share [of tax]. What that discussion did not have coming out of the budget... was a discussion on why is it that more of our economy is going to global technology companies and what does Australia need to do in order to better play on that stage."

Hillard said that Australia has a "very healthy" ICT sector and that Australia's digital economy is growing dramatically.

"In an environment where [government] is announcing initiatives to make sure that the local ICT sector is disproportionately equipped to be able to skill-up and deliver on those promises and an environment where it's asking for efficiency dividends from its departments and agencies, it missed an opportunity to be quite explicit on the use of digital and the digital economy to better deliver services to citizens," Hillard said.

Hillard said the funding for Keeping the Seniors connected program, the successor of the Broadband for Seniors initiative, was a positive in the budget. The program will provide 2000 kiosks and free broadband Internet access as well as training for seniors. "The recognition of the social advantage that that provides is something I think is actually a harbinger of really great things to come across the community."

Gedda said that for the local industry, the fate of the NBN overshadowed the budget. It's "the big elephant in the room," Gedda said. "That's the main thing everyone's focussed on: how quickly the NBN will be scaled back if there's a change in government."

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