UPDATE: Senate outsourcing inquiry called

The Department for Finance and Administration (DOFA) has gone to ground, refusing to comment on whether timetables for the remaining tenders are threatened by the public Senate inquiry announced yesterday.

The Senate inquiry is in addition to the seven-day review announced earlier this week by DOFA. A Democrat/Labor senate alliance has called for the Senate Public Finance and Administration Committee to publicly review the Federal Government's controversial IT outsourcing policies.

Although the terms of reference of the have yet to be finalised industry pundits are sceptical that it will announce its findings before the new year.

This latest development fuels concerns that the current outsourcing process will be stalled thanks to party politics.

Outsourcing players yesterday expressed their concern that the local IT outsourcing industry's capacity to participate in the tendering process would be further compromised by a delay to the tender reviews.

While Nick Cuthbertson, managing director of Melbourne-based IT outsourcing company Protech Australasia, recognised the need for due process, he was concerned the review would be hijacked by political interests.

"There is always a need to question the probity of this kind of Government expenditure, but anyone questioning the logic of Government outsourcing as a policy is just trying to hold back the tide," Cuthbertson said.

Other Australian companies involved in the tender process are concerned the reviews will further complicate an already overly bureaucratic system.

Support for the new inquiry swelled as the Federal Minister for Finance and Administration John Fahey met with CSIRO staff association representatives yesterday.

Australian outsourcing companies backed the CSIRO staff association's move to exempt areas such as research from the Federal Government's IT outsourcing push.

Peter Kazacos, managing director of ASX-listed outsourcing company KAZ Computer Services, told ARN that sensitive areas involved in national security and defence should certainly not be included in the outsourcing push.

"IT outsourcing is really designed for areas such as administration. It would be absurd to try to outsource what the CSIRO does for the country," Kazacos said.