Analyst: Centralised ICT Government procurement beneficial to industry

The Federal Government’s new centralised computing and telecommunications procurement arrangements are likely to bring a welcomed certainty to the market, an analyst claims.

Announced by Senator Lindsay Tanner this week, the whole-of-government panels and contracts cover desktop computing equipment and telecommunications products and services.

In a statement, Tanner said the decision reflected the Government’s commitment to achieving savings and efficiencies through better utilisation of aggregated buying power.

The first of these arrangements for desktop computing equipment, telecommunications invoice reconciliation services and Internet-based network connections will be in place by the end of the 2009-2010 financial year.

The changes will bring procurement in these fields more in line with the Gershon review, which originally proposed sweeping procurement changes to address inefficiencies in “business as usual” spending.

Intermedium head of consulting, Kevin Noonan, expected the industry would welcome the announcement, which had been coming for a while.

“Suppliers would typically have to respond to a lot of tenders to gain enough business with the Government in this field,” he said. “The new process will be simpler for both the Government and suppliers.”

Larger incumbent suppliers will mostly benefit in the short term, as the process becomes more commodity-driven and price becomes a bigger issue, Noonan said. However, opportunities would open up for smaller players in the longer-term, he claimed.

“The arrangements will enable newer entrants to come to market with a degree of certainty,” Noonan said. To meet requirements in the interim period, the Department of Defence has put out a request for tender to form a panel for desktop computing equipment. Tanner said other agencies with immediate desktop PC requirements could use that panel until its new centralised arrangements are finalised.

According to Tanner’s statement, further arrangements for telecommunication management services and commodities, such as mobile phone handsets, are planned for deployment through the 2010-2011 financial year.

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