Sunday, November 21, 2010

Australian Government ICT Progress Report

The report of the "Review Independent Review of Implementation of the ICT Reform Program" by Dr Ian Reinecke, was released 18 November 2010, by Gary Gray, Special Minister of State. The 47 page report is available chapter by chapter as web pages (with the Summary of the Review being a good place to start), or as one document in 350Kbytes of Microsoft Word and 1.4 Mbytes of PDF.

This review looks at how well they government has implemented the recommendations of the 2008 Gershon Report on Government Use of ICT. Progress has been made on the easier of the cost savings recommended by Gershon but the new report finds more is needed to be done to change ICT governance in the Australian Public Service, particularly for whole-of-government initiatives.

Dr Reinecke makes some proposals to continue the Gershon reforms, but more importantly recommends a modified governance structure. In particular he proposes a dedicated Ministerial ICT Committee. He also proposes two qualified independent members from outside the APS to assist (I am available and qualified).

While it looks at the role of ministers, departmental secretaries and AGIMO in the way ICT is done for the Australian Government, the report does not appear to consider the role of the ICT profession. The Gershon reforms have now undone some of the damage from the previous outsourcing policy. However the APS needs to rebuild a cadre of ICT professionals who can revolutionise the way government business is done, to make the APS efficient, effective and online.

Overall the report gives a positive report on how ICT reforms have gone and provides useful recommendations for improvement. The government is likely to be pleased with the results. But while the government has had this report since June 2010, it is still "considering" it, six months later. This is an indication that while progress has been made on the mechanics of implementing ICT, the decision making processes it supports need radical change to bring them up to the standard expected in the 21st Century.

Technology is at hand to build Government 2.0 cloud based, wireless enabled systems with mobile tablet interfaces, which can provide executives with instant, accurate information (my course COMP7420: Electronic Data Management will teach this to public servants at ANU in early 2011). But if the executives of the organisation have been trained in paper based, stream age ways of decision making, these advanced ICT systems will be of little value. The Australian Government needs to extend the scope of the Gershon reforms, to ensure that the decision making which uses ICT is also efficient and effective.

Summary of the Review

This review was recommended by the Gershon Report as “an independent review of progress”, to be undertaken in the first quarter of 2010. Its scope is confined to examining the implementation and assessing the effectiveness of the Report’s recommendations. It will also make recommendations about the future of AGIMO in light of the ICT Reform Program that the Gershon Report initiated. The review will examine the complex and ambitious program of work set out by the Report to assess its progress and effectiveness. Where necessary, the review also indicates actions aimed at correcting matters that impede effective implementation.

Although the emphasis of the Gershon Report on cost savings has overshadowed its other recommendations, in the long run what it recommended, in addition to tighter management of business as usual funding, is of more lasting significance. Collectively its recommendations constitute a substantial reform program that includes stronger governance of ICT, better organisational capability and an improved public sector skills base. The Report also called for aggregating Government data centres, improving the ICT marketplace and increasing sustainability of ICT.

Major findings

The policy underpinnings recommended by the Report are now mostly in place. Their continued execution however will require sustained management effort. In the course of conducting interviews with Government and industry executives and extensively reviewing documentation, it became clear that very substantial progress has been made in the two years since the Report was completed. This review has, however, highlighted a number of areas needing improvement. Prime among them is the governance structure proposed by Gershon, which is not producing its intended business focus, and the vision and supporting strategies needed to continue to drive whole-of-government initiatives and ICT public sector reform.

In August 2008 in his transmittal letter to the Minister of Finance and Deregulation Sir Peter Gershon anticipated “two critical requirements which will determine the success of this reform program”. They were the need for sustained leadership by Ministers and top Government officials and the need to ensure that “enablers of change” were properly resourced with appropriate levels of funding and skills. These were prescient remarks. This review has found that there is room for improvement in both areas, and has recommended accordingly.

Key issues

The improvements recommended to strengthen the reform program are in two areas:

  • Proposals designed to re-focus the approach to ICT reform, by sustaining implementation of the Gershon building blocks, and
  • A modified governance structure to strengthen capacity to develop an ICT vision and supporting strategies, taking into account developments over the past two years.

Before outlining the recommendations, the major issues identified in interviews as having the greatest impact in the implementation of the Gershon Report are summarised. These issues have generated most discussion about the ICT reform program both in the public domain and in the interviews conducted in the course of this review. These key issues should not obscure those recommendations of the Gershon Report that despite a lower profile are likely to have a constructive effect over time.

Savings targets

The dominant issue in perceptions about the Gershon Report, both within and outside the Australian Public Service (APS), has been the imposition of savings targets on ICT budgets totalling $1billion over four years. The level of analysis required to collect data and compare the results with external benchmarks has absorbed substantial resources in both AGIMO and other agencies. Undoubtedly some agencies found it difficult to find these savings, especially after the first round of targets, and there is residual preoccupation in the APS about both the quantum and the effect of the savings.

There is also a concern, shared with the supplier industry, that the savings targets have had the effect of promoting the perception that ICT budgets should be treated as costs to be contained, rather than as investments leading to greater productivity. The establishment of a Business-as-Usual Reinvestment Fund (BRF) that returns half the budget savings to a fund that agencies can apply to for project funding has not assuaged all the concerns about negative effects of ICT budget cuts. The focus is now however shifting to non-financial issues of governance, procurement policy and the role of AGIMO itself.

Role of Ministers

The Gershon Report correctly emphasised the importance of strong support by Ministers and Secretaries to ensure that its recommendations were executed across the public sector. The high workload associated with implementing the recommendations generated processes for Ministerial approval of new policies and funding decisions. Those processes have been an intensive and necessary element of executing the Gershon recommendations, but have crowded out more strategic consideration of the role of ICT.

In the case of Ministers, that crowding effect has been seen in the operation of the Expenditure Review Committee (ERC) when considering ICT matters. ERC is augmented with two additional Ministers when considering ICT issues but pressure of business has meant that little time has been devoted to providing the top-level leadership Gershon envisaged. The time spent by ERC considering ICT issues has been occupied by the requirement to review recommendations from Secretaries relating to the ICT reform program.

Secretaries’ role

The clear locus of authority for ICT matters is with the Secretaries’ Information Governance Board (SIGB), which was tasked with considering business rather than technology issues. Instead, the proceedings of SIGB have been dominated by consideration of new policies often of a highly technical nature arising from Gershon. SIGB is also the key decision point in the governance structure for determining successful applications to the BRF.

The result of this preoccupation with reviewing progress is that much of SIGB’s business, especially in 2010, has been conducted out-of-session, without the level of discussion that informs decisions taken in face-to-face meetings. The casualty of this approach has been an inability to develop an ICT vision and the strategies needed to support it. Instead, SIGB’s proceedings have been characterised by process-laden agendas, voluminous documentation, and a focus on technology rather than business issues. As the Gershon recommendations are progressively implemented there is a need to more closely involve Secretaries in setting a five-year direction for ICT in Government. This is a major challenge in preparation for what has begun to be described as the post-Gershon era.

AGIMO’s role

AGIMO has done the heavy lifting in implementing the Gershon Report. It has introduced a raft of new policy, driven the entire governance structure and delivered budget savings that have, at times, made it the focus of considerable resentment. AGIMO has the least enviable task in the ICT reform program and has, in the face of some opposition, efficiently undertaken the task the Government set for it. The cost has been considerable criticism although it is often difficult to determine whether the criticism is directed at the Government’s decision to adopt Gershon’s recommendations, or at AGIMO for implementing them.

The onerous role that AGIMO has undertaken has revealed issues, that if not addressed may impede its effectiveness as the reform program continues. Principally this relates, as Gershon anticipated, to the skills and resources available to implement an ambitious change program. AGIMO has been expected to lead the policy agenda, in the Report’s words to be a “catalyst for change” and to deal with often highly technical implementation issues. One lesson to be drawn from this is that the expectations placed on AGIMO were unsustainable, and its role and structure need to be reconsidered.


By their nature, reviews such as this seek to identify the fault lines associated with implementing Government programs and to suggest ways they can be remedied. There is much that is positive about ICT reform in the last two years. Without the aggressive change program that the Gershon Report laid out, the Government would not know what it now does about how to extract better value from its use of technology. To add to the momentum for change, a conjunction of events since 2008 has worked to position the issue of ICT in Government much more strategically.

The pressure for further reform and the need for high-level strategic thinking and leadership has intensified as a result of developments since the Report was written. These include:

  • The effects of a global financial crisis that demands continuing budgetary restraint,
  • The APS public sector reform agenda which will require extensive use of ICT to enable better and different service delivery,
  • The National Broadband Network and its promise to enable delivery of Government services across high bandwidth infrastructure, and
  • Improved citizen engagement through the use of Web 2.0 tools and techniques.

Conducting the review

The Review began with an examination of the papers produced for the implementation of the Gershon Report ...

The second source of information for this review has been a series of interviews with a very wide cross-section of Ministers, Secretaries, senior public service executives and CIOs, as well as industry representatives. ...

AGIMO provided significant documentation tracking implementation of the Gershon Report recommendations and organised meetings selected by the reviewer with a range of Government and private sector executives. ...

Structure of the Report

This report is structured around the seven major areas identified by Gershon and in the order in which they were presented. ...

Recommendations for improvement

... five recommendations arising from the review ...
  1. The Government should institute a dedicated Ministerial ICT Committee with additional members scheduled as augmented ERC meetings with formal agendas and matters for decision. (1.1)

    1. Two qualified independent members from outside the APS should be added to SIGB, as well as the Secretaries of the Departments of Broadband, Communications and the Digital Economy (DBCDE) and Innovation, Industry, Science and Research (DIISR);
    2. SIGB should agree a forward schedule of face-to-face meetings and where matters need to be considered out of session share agency briefs to better inform decisions. (1.2)

    1. Finance should undertake a thorough assessment of AGIMO’s current capability and resources as part of its consideration of whether AGIMO’s two current major roles should be functionally separated;
    2. Lead agencies for projects approved by the Government should be formally appointed by the Minister for Finance on advice from the ERC, SIGB and AGIMO after consultation with relevant agencies and be subject to written agreement detailing their roles and responsibilities (1.4)

    1. As benchmarking reaches greater maturity AGIMO should examine means of simplifying, automating and reducing the load of data collection;
    2. AGIMO should also provide guidance to chief executives to assist them in their interpretation of benchmarks and encourage the exchange of data between agencies;
    3. AGIMO should develop further guidance on shared services including methodologies for risk assessment, benefits realisation and project planning and management. (3.3)

    1. AGIMO should be more closely integrated with Finance to provide implementation support under the leadership of a Chief Technology Officer;
    2. A dedicated ICT policy unit headed by the Government Chief Information Officer should be established to support SIGB’s leadership of the reform program;
    3. The responsibility of Secretaries for oversight of agency and cross-Government ICT matters should be clarified in the APS public sector reform process;
    4. SIGB should establish a taskforce of senior APS executives to assist it to develop a vision and supporting strategies for ICT in Government. (8)
From: Summary of the Review, "Review Independent Review of Implementation of the ICT Reform Program", Ian Reinecke, Department of Finance and Deregulation, 2010

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