NSW procurement changes highlight schism with industry

Public-private partnerships yet to flourish in NSW as government rushes toward economic growth

The NSW Government has urged the state’s ICT industry to back forthcoming changes to procurement contracts but consternation among some have shown a continuing need to iron out differences.

The government this week flagged substantial changes to its IT procurement policy as part of the implementation of its ten-year Business Sector Growth Plan, released in September.

The changes, to be implemented in a model contract released on 22 February next year, mirrors some of the changes made at a federal level. These include a mandate for the government to hold a default position of giving intellectual property rights for government contracts to the supplier.

Other changes include a standard limitation of liability and an improvement of insurance requirements to protect small to medium enterprises from participating in enterprises.

Premier,Kristina Kenneally, said the revamped Procure IT obligations would “cut red tape” and eliminate extensive legal negotiations. It is also believed the model contract could yield tens of millions of dollars in saving for the government.

“We’re now very close to having a model that both government and the industry will support,” she said.

She said the success of the changes would rely on support from industry.

“But I’m quite confident this will happen once you have the opportunity to take in the changes we have been to create together,” she said.

Industry body Australian Information Industry Association (AIIA), which contributed to some of the industry consultation leading up to the procurement revamp, emphatically welcomed the changes.

“Your government has shown extraordinary leadership in recognising that a fairer contract will result in increased ICT participation in the market and NSW has made a conscious decision to balance the acceptance of a little bit more risk in the expectation of getting higher levels of business engagement and increased competition,” the AIIA’s general manager for policy and government relations, Loretta Johnson, said.

However, a discussion panel held between government and industry members sparked debate over whether the public and private sectors could work effectively together.

“All industry suffers from not understanding how to work really well with governtment, and government suffers that issue too about how to do it properly with industry,” Deputy Director-General of State and Regional Development, Barry Buffier, said. “I think it’s a two-way street.”

Rob Fitzpatrick, director of commercialisation at government-funded research body National ICT Australia (NICTA), attributed the schism to a lack of consultation from industry. He said the lack of industry consultation by government prior to procurement changes were astounding.

“It stunned me... people saying ‘we’ve never been asked for our input before’,” he said.

CSC Australia chief technology and innovation officer, Bob Hayward, agreed with Fitzpatrick but urged government to be turn to industry earlier for help, rather than attempting to insource projects.

“Whether it’s empire-building or because they’ve got the people they feel they’ve got to find something to do I don’t know,” Hayward said. “I don’t understand why the NSW Government now for example is out to tender to talk about two data centres. I’m in the IT business and I wonder why I’m running data centres.”

The government has struggled in recent months to build both its internal ICT portfolio and collaboration with industry in the face of increased competition from Victoria and Queensland. Keneally this week stressed the contributions made by government to bodies like NICTA as part of its wider, $36 million digital economy strategy.

She also pointed to the establishment of the Australian Centre for Broadband Innovation between CSIRO and NICTA, with which the government hopes to establish further partnerships with the private sector and encourage “knowledge intensity” and innovation.

Buffier, however, conceded that the risk-averse nature of governments would ultimately prevent innovation, particularly in a ICT procurement environment.

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Tags cscnictaAustralian Information Industry Association (AIIA)NSW Premier Kristina Keneally

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