With an annual spend of around $150 million on PCs, notebooks and servers, the NSW government is polishing up its guidelines for replacing five-year-old contracts which expire in October.
Initial estimates earmarked $40 million for new contracts but this has been revised and will now be in the order of $150 million, a Department of Commerce spokesperson confirmed.
The original contract, was scheduled for release in April, but will now be available in June.
"The approximate contract value is $150 million per annum, and is an estimate of expenditure by government for products and services available through the panel arrangement," the spokesperson said. "The contract value is provided as a guide to potential tenderers."
Government departments across NSW will receive a fresh contract outlining preferred computer hardware suppliers and procurement guidelines in preparation for the lavish annual spend.
The existing contract comes under the ITS2000 panel user guide which is produced by the Department of Commerce to provide agencies with a preferred suppliers list.
The list of 13 approved hardware suppliers is unlikely to change much in the new contract, the spokesperson said.
The panel arrangement can be accessed by NSW government agencies, authorities, state-owned corporations, councils, and other not-for-profit community organizations.
Schedule 1 departments - those that are generally centrally funded from Treasury, such as education, Police, Health, and Commerce - are required to buy from these contracts, the spokesperson said.
It is these agencies that purchase from the contract which will spend around $150 million every year but since not every NSW government agency uses it the total spend will be even higher.
Operating systems is one area given little attention in the existing contract which states: "for desktop and notebook computers it is mandatory that the latest version of the operating system (Windows XP Professional or equivalent) software as nominated by you is included in the tendered price".
The guide justifies this directive by stating "the OS is a standard inclusion because purchased separately would cost you considerably more".
The spokesperson denied the contract is restrictive saying it does not preclude government from purchasing computers loaded with Linux, Novell, Red Hat or other operating systems.
"Additionally, Mac OS X can be purchased through the Apple Pricebook contract," the spokesperson said. "Some agencies use these products on their desktops and notebooks."
A decision has not been announced on what range of operating systems will be accepted in the new contract.
The term of the new contract will be three years with extension options.
Richard Harris, Gartner Asia Pacific vice president of research, said the 2001 contract was a sign of improvement in getting aggregated buying clout and now it looks like attempts are being made to simplify contracts to benefit both government and suppliers.
"To try and limit contract negotiation is a good thing," Harris said. "Trying to get a standard set of IT products to buy gives greater flexibility and economy of scale."
But Harris said there is still some way to go between practice and aspiration across the NSW government.
When compared to a similar large commercial organization, Harris admitted government departments have more onerous requirements when it comes to purchasing.
"The game has moved and it's starting to build down to a satisfactory low cost base," he said.