Government relying on eBay for hardware not a great idea, APS Review suggests

Thodey Review reveals cost to government of legacy IT

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A major government IT system is so out of date that replacement hardware for it needs to be sourced from second-hand parts sold on eBay.

The Immigration Records Information System, which processes visa applications, was originally rolled out in 1989; hardware to support the system hasn't been produced for a decade. The system is one of the examples of the burden that legacy IT imposes on the work of the Australian Public Service cited by the Independent Review of the APS.

The government today released the final report of the review, which was led by former Telstra CEO David Thodey, as well as its response to the review panel’s recommendations.

Another example the report cites of aging IT still delivering a critical function for the government is the Medicare payment system which relies on a “complex web of legacy and inflexible ICT systems”, encompassing 200 applications and 90 datasets.

Although data reveals that the Australian government’s spending on ICT is consistent with other nations, a larger proportion of that money is being spent on operating IT systems rather than growing or transforming capabilities, the report noted.

That could indicate the impact of operating legacy systems, technological deficit and inefficient spending, the review panel concluded.

The review found that with the exception of the $1.5 billion Welfare Payment Infrastructure Transformation program, there has been “limited work” to assess the “budgetary investment required to transform the APS”.

“The APS has high run costs due to using out-of-date and old technology platforms, and investment in transformation offers an opportunity to bring down costs,” the report said.

“While the lack of data precludes the review from estimating more precisely the funding required to digitally transform the APS, benchmark analysis suggests that raising APS spending levels to benchmark digital transformations in the private sector could be in the order of $400 to $900 million a year,” the report argued.

Upfront investment can deliver significant cost savings in the long run, the report noted.

“Further, the adoption of new technologies, such as cloud-based solutions, offers potential for significant cost savings while still providing better services — and therefore better outcomes — for Australians,” it added.

Underinvestment in ICT has led to minimal maintenance and upgrades of platforms. As a result, many environments are difficult to maintain.

“The fragmented and incoherent approach has resulted in an eclectic mix of technologies and systems that complicate the management and upgrade of the total ICT portfolio,” the report stated.

One of the recommendations from the report is that the government fund an “urgent” audit of ICT across the APS.

An audit is required “to resolve this lack of core information on government ICT spend — creating an inventory of current and forecast government ICT expenditure and assets, systems scheduled to be retired or no longer supported by software vendors, associated risks and future requirements,” the report stated.

That audit could be used to develop an ICT blueprint: A “comprehensive plan for future investment, including the management of risks posed by legacy systems”.

The government endorsed the recommendation. In its response it noted that the Digital Transformation Agency (DTA) is working with the departments of Defence and Home Affairs, Services Australia and the Australian Taxation Office on examining a “single whole-of-government technology architecture and identify critical technology capabilities “.

Last month government services minister Stuart Robert revealed that the DTA-led taskforce would work to identify “critical technology capabilities that support broad business outcomes and progressively develop a more nuanced view of strategic capabilities across government”.

“This will help us understand both the common functions we need to perform across the whole of government as well as discrete capabilities specific to the business needs of individual agencies,” the minister said.

In its response to the Thodey Review the government “noted” another recommendation that it consider shifting digital functions to a single entity.

“In the medium to long term, to support ongoing digital transformation, digital functions could be transitioned to a standalone central department led by a secretary,” the report stated, giving as examples the UK Government Digital Service and the Singapore Digital Government Office.

“The APS needs to create a critical mass in order to transform. Internationally, governments are increasingly clustering data and digital functions within a single entity. This is designed to create a critical mass of resources and capabilities, end-to-end accountabilities, and the credibility to drive digital transformation,” the report stated.

The government said it would “continue to strengthen the Digital Transformation Agency, including building its capability and role in support the digital transformation of government”.

Copyright © 2019 IDG Communications, Inc.

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