Australian government paid AU$4.9b to IBM, Boeing, Lockheed Martin for IT services

Over the course of the five-year period, the three technology heavyweights walked away with AU$4.9 billion in government IT spend, a report from ANAO has revealed.
Written by Asha Barbaschow, Contributor

The Australian government spent a total of AU$36 billion on IT-related procurement from 2012-13 through 2016-17, with a handful of technology giants receiving the majority of the procurement spend, a report from the Australian National Audit Office (ANAO) has revealed.

According to ANAO's Australian Government Procurement Contract Report, during the five-year period, IBM -- which failed to prepare adequately for the 2016 Census -- won a total of 692 government contracts totalling AU$2.33 billion, while Boeing won 165 contracts and received AU$1.6 billion for IT-related contracts, and a total of AU$4.2 billion when counting services outside of IT.

The Australian arm of US defence giant Lockheed Martin signed 260 government contracts during the period, walking away with a total AU$1.46 billion in Commonwealth procurement coin.

Rounding out the top eight vendors was Fujitsu, with 1,092 IT contracts worth AU$961 million; Abacus Innovations with 133 IT contracts totalling AU$894 million; Data#3 with AU$883 million for 1,689 contracts; Telstra with a total of 1,091, with IT accounting for AU$660 million of its AU$2.8 million government contract total; and Hewlett Packard with 1,517 contracts totalling AU$597 million.

Raytheon, Thales, Oracle, Accenture, BAE Systems, SAP, Optus, Dell, Unisys, and Dimension Data all received over AU$300 million each from the federal government during the five-year period.

Government IT procurement spend peaked in 2014-15, the ANAO report [PDF] highlighted, with the total tipping AU$7 billion; and for the 2016-17 financial year, spending dropped to just below AU$6 billion.

For the purpose of its report, ANAO defined "IT-related" as information technology broadcasting and telecommunications/engineering and research and technology-based services. The most common sector for IT spend during 2016-17 was computer equipment and accessories.

The Department of Human Services (DHS) spent the most percentage-wise on IT procurement from 2012-13 through 2016-17, spending over 40 percent of its total procurement kitty on technology-based services.

For the same period, the Department of Finance -- which obtained contracts for whole-of-government software maintenance and support, and internet-based services for other departments -- spent over 35 percent of its budget on IT-related procurement, followed by the Department of Veterans' Affairs, which spent just over 30 percent of its total on technology-related procurement.

The Department of Industry, Innovation and Science spent only 10 percent of its procurement coin on technology-related procuring, despite being charged with the nation's AU$1.1 billion National Innovation and Science Agenda.

When it comes to total cash spent, the Department of Defence paid AU$15 billion for IT-related services during 2012-13 through 2016-17.

DHS, which came under fire during the 2016-17 year as a result of the Centrelink robo-debt debacle, spent a total of AU$3.2 billion during the same period.

The Department of Immigration and Border Protection, which saw its border control functions merge with the Australian Customs and Border Protection Service, spent AU$2.7 billion; the Australian Taxation Office (ATO) outlaid AU$1.2 billion while it suffered a handful of outages over the past year from "one-of-a-kind" SAN outages to mainframe reboots; and Finance spent a total of AU$1.1 billion on IT-related procurement over the five-year period.


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