The Victorian Government has caved into pressure from the information technology industry, announcing that it will refresh its controversial new eServices panel by 31 October.
The industry had been in uproar after the almost 300-strong panel, which state government agencies have to use to source their IT services, was cut down to 188 following a request for tender process, despite the Victorian Government receiving 600 bids from companies wishing to be included. Many companies originally on the panel were not reappointed and had not received any feedback as to why they were unsuccessful.
The state Opposition slammed the slimming down of the panel, saying that it threatened Victoria's position as an IT hub as snubbed companies were likely to go and seek work in other states.
The Australian Information Industry Association (AIIA) criticised the lack of communication between the industry and the government. AIIA CEO Ian Birks took out time to meet with Technology Minister Gordon Rich-Phillips on the matter.
Companies left off the panel, such as TechnologyOne and Melbourne IT, had asked for a debrief so they could understand why they had been excluded.
However, the government has now gone a step further than that, by responding to the industry anger by announcing that it will re-evaluate the panel, with a refresh of its membership to be completed by 31 October. Prospective panellists will also receive further information about evaluation criteria to help them properly prepare their bids.
Rich-Phillips said that it was "apparent" that there was a need for a broader panel to meet the government's IT requirements.
"Companies will have another opportunity to secure a place on the panel, which will result in greater choice and competition for departments as well as improved access for more small and medium enterprises to government business opportunities," he said in a statement.
Rich-Phillips also said that an industry-government working party would be established to provide advice on how the government should approach and operate the panel in the future as well as implement a "more streamlined and transparent" panel exemption process.
Shadow IT Minister Adem Somyurek said that the government's about face on the panel was a "humiliating back down".
"This is a win for the Victorian ICT sector, a win for the various departments and agencies engaging the panel's IT providers, and a win for common sense," he said.
"This was a shocking decision, and the anger in the sector was palpable, yet what is unexplainable is how the Baillieu Government could have so monumentally bungled this decision."
Somyurek said that the decision could have cost hundreds of jobs and was the result of Rich-Phillip's lack of understanding of the industry.
"Mr Rich-Phillips made these wholesale changes without consultation, only notifying the sector after the full tender process was run.
"Mr Rich-Philips clearly didn't understand the ramifications of his ill-advised decision, and he still doesn't understand this sector which is so important to the Victorian economy."
The AIIA welcomed the government's announcement.
"AIIA has worked closely with every sector of the ICT industry affected by the recent review of the eServices panel," said AIIA national chair Philip Cronin.
"The Victorian Government demonstrated a strong commitment to listening to the concerns of industry and working towards outcomes that will better serve the state, and the results are clear in today's announcement."
The Victorian arm of the AIIA was also pleased.
"Companies unsuccessful in the previous round of applications will be able to maintain their existing bids or submit revised bids for consideration; the process will also be open to any company who had not previously applied," AIIA Victorian Branch chair Russell Yardley said.
"Exemptions to the current eServices Panel are possible and any exemptions granted will be published to improve transparency. Statistics on the usage of the panel will also be made publicly available on a regular basis."
Yardley pointed out that transparency in procurement was extremely important, and relied heavily on communication between industry and government.
Melbourne IT CTO Glenn Gore said that his company had originally been surprised not to be included on the panel. "There were some big names missing on that list," he said.
Melbourne IT had been seeking a debrief on the panel decision, but now he was pleased at the fresh chance to be included, which was "refreshing to hear from the government".
"Ultimately that's going to drive better competition."
Microsoft was also pleased.
"Microsoft welcomes the decision of the Victorian Government. Microsoft acknowledges Rich-Phillips' commitment to procurement processes that deliver value for money for taxpayers, competitive choice for departments and incentives for ICT companies that invest in innovation in Victoria," Simon Edwards, Microsoft Australia and New Zealand director of Corporate Affairs, said in a statement.