Budget '09: Cuts hit Defence IT spend

The Department of Defence's chief information officer group has been tasked with finding $166 million of total savings over the next four years, it was revealed in the Federal Budget tonight.

Forward estimates contained in the Defence budget documents showed that the net cost of the CIO Group over the next year was planned to be $808 million. This number would be progressively reduced to $642 million by the 2012-13 financial year. Suppliers have been targeted to take the brunt of the cost cutting, with a $181 million cut to the cost of suppliers by 2012-13. Defence's own IT staff costs are slated to rise.

The budget confirmed the CIO Group as critical to the $20 billion in savings targeted in Defence's Strategic Reform Program, with forward estimates of savings over $5 billion it was revealed tonight.

By reducing the use of contractors and providing more centralised support to the Australian Defence Force — these efficiencies will deliver savings across all of Defence of approximately $500 million across the forward estimates and $3.5 billion over the decade, said Defence Minister Joel Fitzgibbon in a statement.

However, it wasn't all bad news for the CIO Group, led by chief information officer Greg Farr. Fitzgibbon also said the department would invest $30 billion over the next decade to fill Defence holes he claimed had been left by the Howard Government; one area flagged was Defence's ICT systems, which Fitzgibbon said had been run down over recent years.