UPDATE: Outsourcing office fends off tender worries

The Office of Asset Sales and Information Technology Outsourcing (OASITO) has denied claims the outsourcing review announced yesterday will interrupt the Group 1, 11 and 9 tenders.

Speaking with ARN this morning, OASITO press secretary Paul Edwards said the review would not set the tender process timetable back in any way. Despite this he confirmed the Group 9, Group 10 and the Department of Defence outsourcing contracts will not proceed to requests for tender until the review's findings are handed down in early December.

Edwards moved to quell concerns the review would have far reaching effects on the Government's IT outsourcing policies which have seen billions of dollars worth of public expenditure transferred in to the private sector.

"An extensive review into the outsourcing process has already taken place in terms of the recent Auditor General's report, and we have taken those findings on board," Edwards said. "The review announced yesterday is designed to assess policy implementation risks and will not in any way change the Government's commitment to out IT outsourcing initiatives."

Minister for Finance and Administration John Fahey announced the independent inquiry into the Federal Government's controversial IT outsourcing policies on Tuesday. ASX managing director Richard Humphry is set to take the helm of the independent review committee, charged with assessing the Whole of Government IT Outsourcing Initiative.

Humphry previously held a position on an information technology and telecommunications policy advisory committee commissioned to advise the minister on IT issues in 1996. However Edwards denies this formally held position is any indication of bias towards the Government's current outsourcing policies.

"Humphry held a position on a committee that advised the Government on issues such as the IT skills shortage. It had no relationship to the government's IT outsourcing policies," Edwards said.

Edwards defended Humphry's appointment, saying that he had played major involvement in a major ASX IT upgrade and had extensive experience in IT policy implementation in both the public and private sectors.

Yesterday's announcement comes after increased pressure placed on the Government in the wake of the auditor general's report, which revealed a massive budget blow out.

The Australian National Audit Office (ANAO) report released in July claimed the Government's outsourcing policies suffered from poor planning and significant budgetary and resource issues.

The ANAO report revealed that the policy, which was initially promoted for potential savings to the Government, was already costing taxpayers at least $27 million more than original estimates.

However, according to Edwards, the review will not examine expenditure issues, rather it is set to focus on issues arising from the rapid and massive implementation of the IT outsourcing policies.

The policy has also come under fire for failing to allow Australian IT companies the opportunity to fully participate in the tender process.