Gershon Report on Australian Government ICT

The Review of the Australian Government's Use of Information and Communication Technology by Sir Peter Gershon, was released by the Minister for Finance on 16 October 2008. This provides a snapshot of the current state of ICT in the Australian Government. Sir Peter comments that agency autonomy the "model of weak governance of ICT at a whole-of-government level" is sub-optimal. He argues for sustained leadership by top officials and Ministers and resources for change, and skilled staff. The report presents a powerful argument clearly, but is overly optimistic as to how quickly changes can be made.

Will the Ministers Listen?

My experience of being a senior ICT policy maker in government nine years ago was that such skills were not highly valued by the senior executive of the Australian Public Service nor the ministers. This was more a failing of ICT professionals to present their capabilities in a way that non-technical clients could understand, than a failure of the leadership. Advances have been made since then, with Australia leading the world in writing a standard for Governance ICT which has now been adopted globally. Also ICT professionals are being better trained in communication and business skills. My colleagues in the Australian Computer Society and the Australian National Unviersity have been contributing to that effort with training for new and current ICT professionals.

Sustainable ICT Planning

The report recommends development of a whole-of-government ICT sustainability plan, in conjunction with the Department of the Environment, Water, Heritage and the Arts (DEWHA), to manage the energy costs and carbon footprint of the Government’s ICT activities. This is a recommendation I made while preparing the Personal Computer and Monitors Energy Efficiency Strategy for DEWHA. Ideally, a sustainability plan can be integrated with the reports other recommendations for a whole-of-government approach to data centres, governance, spending and skills, so that environmental improvements can be combined with cost savings.

Recommendations such as a 50% reduction in contractors in 2 years will be difficult to achieve. Restoring the whole-of-government ICT career structure, which was dismantled with outsourcing, will take time. A whole-of-government strategic ICT workforce plan should be made easier by recent developments in technology and training, with better standards making skills portability more feasable.

50% Saving by Finance Possible in Formatting of the report

The Executive Summary and each chapter of the report has been provided as a separate web page, as well as the full text in one 3Mbyte PDF document. Providing the report sections as web pages greatly improves access and the Minister's staff are to be commended for this. Frequently such government reports are only made available as one large lump of hard to read PDF. The report is overall well formatted and could be displayed on a mobile web browser of a smart phone, as well as a desktop screen. There was one validation error found. An automated accessibility test reported a number of minor accessibility problems: one Level-A, 3 Double A and one Triple A, which could be easily corrected.

However, there is one major flaw in the design of the department of finance web site, with all web pages having an excessively large side menu. The executive summary of the Gershon report is 95 Kbytes of HTML. Of this only 22 Kbytes is the text of the report, with 78% of the file taken up with the Finance menu. This menu appears to occur in all web pages on the Finance department web site and will be causing an excessive load on the system. Also the image in the document has been incorrectly coded as a JPEG image. So the Finance Department could commence implementation of the Gershon reforms with an optimisation of the design of its own web site. A simple redesign would reduce the size of the documents by 50% and thus make a 50% saving in the size of the web server and telecommunications required. Details of how to do this are in my course on web design at the ANU.

Table of Contents

• Glossary of abbreviations
• Executive Summary
  • Introduction /Context
  • Methodology
  • Key Findings
  • Summary of key recommendations
  • Implementation
  • Acknowledgements
• Introduction

1. Chapter 1: Views from within the Australian Government
   1. ICT Investment Decision Making
   2. Project delivery
   3. Organisational capability
   4. People
   5. Managing ICT spend
   6. Procurement and ICT Outsourcing
   7. Use of best practice
   8. Views on existing whole-of-government arrangements
   9. Views on data centres
   10. Views on the ICT industry
   11. ICT arrangements in Ministerial Offices
2. Chapter 2: Views from outside the Australian Government
   1. Better utilisation of ICT assets
   2. Shared services
   3. Standardised/coordinated approach to procurement
   4. Use of Commercial Off-the-shelf Solutions
   5. Need for standardisation
   6. Whole-of-government governance
   7. High costs of tendering
   8. The Australian government compared to other governments
   9. Skills shortage
   10. Green ICT
   11. Security Clearances
   12. Best practices
3. Chapter 3: Summary of survey findings
   1. Survey approach
   2. Survey Results
4. Chapter 4: Key findings
   1. Weak governance of pan-government issues related to ICT
   2. Agency governance mechanisms are weak in respect of focus on ICT efficiency and understanding of organisational capability to commission, manage and realise benefits from ICT-enabled projects
   3. The business as usual ICT funding in agencies is not subject to sufficient challenge and scrutiny
   4. Disconnect between the stated importance of ICT and actions in relation to ICT skills
   5. There is no whole-of-government strategic plan for data centres. In the absence of such a plan, the government will be forced into a series of ad hoc investments which will, in total, cost significantly more than a coordinated approach
   6. The Government ICT marketplace is neither efficient nor effective
   7. There is a significant disconnect between the Government’s overall sustainability agenda and its ability to understand and manage energy costs and the carbon footprint of its ICT estate
5. Chapter 5: Recommendations
   1. Recommendation 1 – Strengthen pan-government governance
   2. Recommendation 2 – Strengthen Agency Governance
   3. Recommendation 3 – Tighten the management of ICT business as usual funding
   4. Recommendation 4 – Enhance the management of the APS ICT skills base
   5. Recommendation 5 – Data Centres
   6. Recommendation 6 – Improve the efficiency and effectiveness of the ICT marketplace
   7. Recommendation 7 – Sustainability of ICT
6. Chapter 6: Implementation
7. Appendices
   1. Terms of Reference
   2. Submission questions
   3. Survey instrument
   4. Submissions received
   5. Consultations
   6. Agencies with ICT Spend over $20 million in 2007–08
   7. Agencies with ICT Spend $2 million to $20 million in 2007–08
   8. Candidates for whole-of government approaches
   9. Proposed criteria for whole-of-government approaches and arrangements subject to opt-out
   10. Proposed role of AGIMO
   11. Linkage between Terms of Reference and Recommendations
   12. Details of ICT Review Team

From: Review of the Australian Government's Use of Information and Communication Technology, Sir Peter Gershon, 28 August 2008 (released by Minister Tanner 16 October 2008)

Key Findings

After detailed analysis of the evidence, the review identified the following key findings:

1. There is weak governance¹ of pan-government issues related to ICT.
2. Agency governance mechanisms are weak in respect of their focus on ICT efficiency and an understanding of organisational capability to commission, manage and realise benefits from ICT-enabled projects.
3. The business as usual (BAU) ICT funding in agencies is not subject to sufficient challenge and scrutiny.
4. There is a disconnect between the stated importance of ICT and actions in relation to ICT skills.
5. There is no whole-of-government² strategic plan for data centres. In the absence of such a plan, the Government will be forced into a series of ad hoc investments which will, in total, cost in the order of $1 billion more than a coordinated approach over a 15-year period.
6. The government ICT marketplace is neither efficient nor effective.
7. There is a significant disconnect between the Government’s overall sustainability agenda and its ability to understand and manage energy costs and the carbon footprint of its ICT estate.

At the heart of these findings is a conclusion that the current model of very high levels of agency autonomy, including the ability to self-approve opt-ins to whole-of-government approaches in the ICT domain, leads to sub-optimal outcomes in the context of prevailing external trends, financial returns, and the aims and objectives of the current Government. The impact of this autonomy has been heightened by a previous lack of strong focus on whole-of-government ICT issues at both Ministerial and top official levels. This conclusion applies no matter how well-intentioned individual agencies are in their pursuit of whole-of-government outcomes.

The current model of operation is very close to treating FMA Act agencies as though they were independent private sector entities. The agencies are, however, very different in a number of aspects: they are funded by the taxpayer, they cannot go bankrupt, they have very little or nothing of the ‘time=money’ dynamic of the private sector, and they have no simple bottom line outcomes against which their success or failure can be measured.

Against the background of the Government’s objectives and the pressures to improve efficiency and effectiveness wherever possible, I consider some rebalancing between agency autonomy and coordination across government is both desirable and necessary in measures related to ICT. Such a move is in line with trends in the United Kingdom (UK) and United States (US) Governments, as well as large private sector organisations.

Summary of key recommendations

The following comprise the primary recommendations of this review. The complete list of my detailed recommendations is found at Chapter 5 of this report. A summary of how the recommendations meet the Terms of Reference can be found at Appendix K.

Governance

• Establish a Ministerial Committee on ICT to be responsible for the key whole-of-government ICT policies and the overall strategic vision for how ICT should support the achievement of the Government’s outcomes and wider policy agenda.
• Create a Secretaries' ICT Governance Board (SIGB) with a strong mandate from the Government to drive the agreed recommendations arising from the review and focus on addressing the key business issues to improve the efficiency and effectiveness of the Government’s use of ICT.
• Allow agencies to obtain opt-outs, based on genuine business need, from agreed whole-of-government activities. Opt-outs to be approved by the Ministerial Committee, informed by the SIGB.

Capability

• Improve agency capability to commission, manage and realise the benefits from ICT-enabled projects through the implementation of a common methodology for assessing agency capability based on self-assessment and periodic independent audit. Each agency Chief Executive to propose a target level of capability based on their agency’s and the Government’s strategic priorities, and for this to be independently validated. Agencies to develop a capability improvement plan with commitment, and agreed actions, to address identified gaps.

ICT spend

• Target to move total FMA Act agency ICT spend from an average 77:23% split between ICT BAU activities and creation of new capability in 2007–08 to an average 70:30% in 2011–12.
• As initial steps towards this goal, reduce the ICT BAU budgets of the largest 28 FMA Act agencies (Defence excluded) with ICT spends in excess of $20 million per annum by 15% from 2007–08 actuals (for a list of agencies refer to Appendix F), with a phased introduction over two years.
• Create ICT Review Teams to help these agencies achieve or exceed the target reductions without impairing service delivery to citizens and business.
• In addition, I recommend targeting agencies with total annual ICT spends between $2 million and $20 million to achieve a 7.5% reduction on average of their BAU from 2007–08 actuals (for a list of agencies refer to Appendix G) , with a phased introduction over two years.
• The 15% and 7.5% reductions in total should save the Government around $140 million in the first year and in excess of $400 million in the second and subsequent years. I also recommend that 50% of the savings generated by these recommendations be transferred to a central fund for reinvestment in projects to improve efficiency and effectiveness of ICT BAU activities, such as replacement of legacy software and hardware with high support and maintenance costs.

Skills

• Create a whole-of-government Australian Public Service (APS) ICT career structure, including training and development programs for ICT professionals in key skills areas.
• Develop and maintain a whole-of-government strategic ICT workforce plan.
• Reduce the total number of ICT contractors in use across FMA Act agencies by 50% over a 2-year period and increase the number of APS ICT staff. This should save the Government an estimated $100 million (across both BAU and project-related work).

Data centres

• Develop a whole-of-government approach for future data centre requirements over the next 10–15 years.

Sustainable ICT

• Develop a whole-of-government ICT sustainability plan (in conjunction with the Department of the Environment, Water, Heritage and the Arts) to manage the energy costs and carbon footprint of the Government’s ICT activities.

Implementation

My recommendations entail a major program of administrative reform and cultural change. Based on my experience of creating sustainable change in the UK public sector there are two critical requirements which will determine the success of the proposed program: first, sustained leadership and drive at Ministerial and top official levels; second, ensuring the enablers of change are properly resourced not only in funding terms but also skills of the right calibre.

The early decisions of the Ministerial Committee and the SIGB will need to send out clear signals about the pace and direction of change which is then reinforced through subsequent decisions. It will be essential to ensure that agreed whole-of-government ICT approaches and arrangements are ‘fit for purpose’. ...

From: Executive Summary, Review of the Australian Government's Use of ICT, Sir Peter Gershon, 28 August 2008 (released by Minister Tanner 16 October 2008)