Australia’s national science agency CSIRO will cut up to 500 staff from its enterprise services arm as part of restructure designed to reduce labour and operating costs by $100 million. CSIRO chief executive Doug Hilton confirmed the planned jobs cuts on Tuesday, ending months of speculation over the fate of a division comprised of more…
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Science minister Ed Husic will not intervene to stop job cuts at the CSIRO that its union says will end more than 600 roles, harm the government’s industry and innovation agenda, and undermine confidence in the national science agency. The CSIRO Staff Association on Monday wrote to the minister to say the organisation was “under…
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Seven thousand public workers rallied outside the Western Australian Parliament House to demand a 5% pay rise. Alex Salmon reports.
The federal government’s $60 million Digital Passenger Declaration is “error riddled” and only works a quarter of the time, according to the public sector union. The Digital Passenger Declaration (DPD) launched in March, replacing the Australia Travel Declaration. The smartphone app collects contact information, vaccination status, passport information and travel history from people arriving in…
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British consulting giant PwC is assessing government grant applications as part of a near-$2 million contract with the Industry department which the public sector union has branded “outrageous and indefensible”. Last month the Department of Industry awarded PwC a $1.9 million contract running from 12 January to 30 June for “surge capacity and capability uplift”….
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The key agencies tasked with delivering the government’s billion-dollar digital spend are facing staffing and funding cuts, leading to concerns the funding will flow straight to private contractors and consultants, and do little to improve expertise in the public sector.
Last week’s federal budget included a $1.2 billion digital economy strategy, with funding for a range of tech projects and digital transformation efforts.
The large bulk of spending went to ongoing projects, with more than $200 million over two years for work to develop a new version of the myGov platform, and more than $400 million for “enhancements” of My Health Record.
The government also allocated more funding for GovERP, a standardised back-end technology platform across the public sector. But the amount was kept secret for commercial-in-confidence reasons.
There are concerns that the bulk of this spending on the key digital government services projects will flow directly to private contractors and consultants, with no effort to improve APS in-house skills.
Services Australia, the agency responsible for the myGov rebuild and the GovERP project, saw its average staffing level cut by 800 full-time staff in the 2021-22 budget.
The Digital Transformation Agency is facing a huge cut in its annual funding, with a planned drop from $98.41 million in 2021-22 to $48.22 million the following year, with an accompanying ASL cut from 255 to 227 full-time equivalents.
Both the myGov and GovERP projects have been primarily led by consultants and contractors so far rather than being built in-house, with the government showing no signs that it will bring the work within the APS.
The true test of the billion-dollar digital package will be whether the significant spending is used to build skills within the APS, Community and Public Sector Union assistant national secretary Michael Tull said.
“Review after review, from the recent Thoday review and others stretching back over a decade, have all identified the need for the APS to reduce its reliance on external private providers and rebuild public service in-house ICT capabilities – which means more APS ICT staff, and more skills development opportunities for those staff,” Mr Tull told InnovationAus.
“But what we have been seeing from the Morrison government is spending up big on expensive consultants and external providers. This has to stop. The test for the government is whether this budget spending will deliver more staff and build in-house capacity or whether it’s just more money for consultants.”
The DTA has been working on a new version of myGov to initially run alongside the existing platform and eventually replace it since the start of last year. This platform will be based on those offered by the private sector and aims to provide a better user experience for the delivery of government services.
The bulk of the work has been completed by big four consultancy Deloitte, which has so far netted more than $30 million for this work, with the new myGov still in a beta phase. Last week’s federal budget provided more than $200 million to this work, but little information on what will be completed with it and the timeframe for the proper launch of the new platform.
Services Australia now appears to be responsible for the project, with the department establishing a Systems Integrator Panel for private providers working on it, but is still yet to reveal who is sitting on this panel.
The only current contract for work on the new myGov is with Deloitte.
The GovERP project, a modernised government technology for managed accounts, resources and workforce, has been running for several years, with the Department of Finance originally responsible for it.
The new digital funding package should come with requirements that the work is kept in-house and skills are developed in the public sector, Mr Tull said.
“So far CPSU members see no evidence that the more than $1 billion announced is going to translate into any new APS ICT roles. In fact, the two agencies playing a central role in the government’s plans look to be losing staff in Services Australia’s case, or in the case of the DTA, having their budget halved,” he said.
The Department of Finance this week revealed that more than half of the funding allocated to the GovERP project in 2019-20 and 2020-21 has gone towards private contractors and consultants.
In an answer to a Senate Estimates question on notice, the department said that of the $67.1 million allocated over two years, $35.5 million has gone towards outsourced work. This is because there is not the necessary expertise within the APS, the Department said.
“The program will implement a new technology in which the APS has not yet developed expertise. The majority of contractors and consultants are engaged to provide specialised skills and services to support the program, many of which are small-to-medium enterprises, particularly with respect to ICT labour,” the Department said.
The government provided a further two years’ funding to this project in last week’s budget, but did not reveal the dollar amount due to commercial-in-confidence clauses.
More than $400 million has also been provided for the My Health Record platform and the Australian Digital Health Agency. Several contractors have also worked on this project, with Accenture winning a $571 million, nine-year contract to provide national infrastructure services, Wentworth Healthcare being paid $5.7 million to support the expansion of the program in 2017 and Allegis Group Australia also being contracted for “improvements” in 2017.
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The public sector union has slammed government secrecy in relation to the redevelopment of the myGov platform, saying the public has the right to know who is completing this work, and there was no valid reason for not disclosing it.
The federal government has been working on a new version of myGov since early last year. The new service will initially run alongside the existing platform before eventually replacing it and is meant to offer a user experience more in-line with private sector services such as Facebook or Netflix.
Much of the work has been outsourced, with Deloitte picking up the bulk of the contracts. Deloitte has so far been paid more than $30 million since early last year for work on the new myGov, which is still in a beta phase.
Late last year Services Australia, which has taken over contracting responsibilities from the Digital Transformation Agency (DTA), established a Systems Integrator Panel for companies that would be contracted to work on the final stage of the new myGov – or myGovDXP as it has been known.
But Services Australia is yet to disclose publicly which companies are on the panel. Earlier this year Deloitte was awarded a $4.5 million contract through this panel, making the Big Four firm the first to be revealed.
But Services Australia has refused to disclose the other companies on the panel, saying it would do so “once all aspects of the procurement process are complete”.
Community and Public Sector Union (CPSU) assistant national secretary Michael Tull said there was no excuse for the government not saying what companies had been selected to work on the myGov project.
“The public has the right to know who the government is contracting to do what work and at what price. We all suspect that ‘commercial in confidence’ is used to hide many sins. But refusing to even reveal who has been chosen for a panel is a whole new level of concern,” Mr Tull told InnovationAus.
“It is hard to see a valid reason for keeping this secret. The government’s justification – that the procurement process is not yet complete – doesn’t stack up and isn’t based on any provision of the Commonwealth Procurement Rules that I can see.
“And given the type of procurement being done here – a panel of providers to work on systems integration – there’s a pretty good argument that potential tenderers would benefit from knowing who else is on the panel.”
In February Services Australia went to the market for contractors to “provide suitable software capabilities to enable any of the prescribed bundles of the core customer experience capabilities”, including content management, experience delivery and experience analytics.
The entire myGov rebuild project is now shrouded in secrecy, with the government declining to disclose any further information on the systems integrator panel, the timeline for the project, or the roles of Services Australia and the DTA.
InnovationAus asked Services Australia when it expects to finalise the contracts under the panel and to disclose its members, for an outline of the project timeline and its various stages, and what roles Services Australia and the DTA would play in the project.
In response, a Services Australia spokesperson said to refer to previous answers, which did not elaborate on any of these questions.
A spokesperson for the DTA also pointed to “recent response” on the project, despite not providing an answer to InnovationAus on the matter for several months.
The increasing use of similar panel-type arrangements for procurement is troubling, Mr Tull said.
“CPSU has long held concerns about transparency and competition in government procurement, and in particular about the use of panels,” he said.
“In our experience, panels make it harder to keep track of who has won what, while on the competition front the ANAO found in 2018 that panel use was increasing, and that most panels had a small proportion of suppliers being awarded the majority of contract value.
“A lack of transparency and declining competition among tenders is not a recipe for the best use of taxpayer dollars.”
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Services Australia has been “run down” by a reliance on outsourcing and private contractors which has led to substandard ICT delivery programs, the public sector union says.
In a submission to a Senate inquiry into Australian Public Service capability, the Community and Public Sector Union (CPSU) said that under-investment in ICT and an increase in outsourcing had damaged the department’s ability to deliver services for Australians.
“The CPSU is greatly concerned that capability in the APS has been devastated by years of budget cuts, efficiency dividends, the government’s Average Staffing Level cap and the rapid rise of labour hire, consultants and contractors,” the CPSU submission said.
“In Services Australia, core work has been contracted to private providers driven by commercial intent at a cost of over $1.6 billion to the taxpayer.”
There has been a reduction of 6000 staff at Services Australia in the last seven years, the union said, with permanent employees being replaced by casuals and contractors.
The department’s contracts with labour hire and service delivery partners are worth over $1.6 billion, while consultancy expenditure is expected to hit $20 million in the 2020-21 financial year.
“These are eye watering figures that demand robust checks and balances to see if they bring value to the taxpayer,” CPSU said.
CPSU members have estimated that half of the ICT workers in the Canberra and Brisbane delivery centres are contractors, and insecure employment at the agency is at “unprecedented scale”.
“Services Australia has lost sight of the benefits of in-house ICT development. A lack of career paths for ICT professionals and the government’s bargaining approach have impacted the agency’s ability to attract and retain ICT talent,” the submission said.
“Additionally, the government’s Average Staffing Level cap has driven the increasing use of ICT contractors for both day-to-day and specialist ICT work.”
The Digital Transformation Agency, which is housed in Services Australia, has already spent more than $20 million on “temporary personnel services” in this financial year, across 141 contracts with recruiters and HR firms, as InnovationAus reported.
There is a steep reduction in transparency and accountability when private contractors and consultants are brought in, the union said.
“Valuable funding has been directed to a growing component of insecure workers and to corporate interests to deliver core in-house work. This is driving down the wages and conditions and reducing the employment security of the workers undertaking agency work or engaged by privatised contract call centre providers doing Services Australia work,” it said.
“These corporate interests operate without the same lines of reporting and accountability expected of departments of state, leaving the public with a distinct lack of transparency for the thousands of millions of dollars being expended.”
The Coalition government has “run down” Services Australia through program budget and job cuts, and this reliance on outsourced work, the CPSU said.
Services Australia has listed 31 contracts with labour hire and service delivery firms, with a total value of $1.64 billion. CPSU said these numbers are “staggering and previously unseen” at the agency.
These contracts include $491 million with ADECCO Australia over four years, $145 million over four years with Serco and $121 million over three years with Datacom.
The department should be required to prove that it can’t complete the necessary work in-house before going to outside contractors, the union said.
“The CPSU has been vocal about the phenomenal increase in consultancy expenditure both in Services Australia, and the APS more broadly in the past five years,” the CPSU submission said.
“Agencies must be required to demonstrate their assessment of whether they have the in-house skills and capabilities, and the benefit of nurturing specific in-demand skills and capabilities, prior to going out to tender for consultants and contractors. Agencies must rein in the amount of work that has been opened to private providers.”
As of October 2020, there were 2,277 employees in the Services Australia technology services branch, equating to 7.3 percent of the workforce. But while ICT contractors were previously used mainly for surge capacity, there is now a “strong prejudice” to go to private contractors as a first option, the CPSU said.
“The agency appears to have lost sight of the benefits of in-house ICT development. There is a lack of career paths for skills ICT professionals and this is hamstrung by an APS-wide bargaining policy that limits enhancing APS conditions to attract the best and brightest to tech APS, along with the staffing cap,” it said.
“Members also advise that skilled APS ICT staff are leaving because they have no career anymore in Services Australia.”
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The public sector union has urged the federal government to reconsider its latest attempt to outsource the development of a visa processing platform, labelling it another “rush to use consultants” for work that should be done by the APS.
The Community and Public Sector Union (CPSU) has written to the Department of Home Affairs to begin discussions on the decision to contract out the development of a new “permissions capability” to eventually be used across the APS for a range of government services.
The Digital Transformation Agency (DTA) late last year issued a tender looking for a private company to build a base platform that is capable of handling the digitisation of incoming passenger declaration cards and a simple digital visa application. This platform would then be used more widely across the APS as a permissions capability.
The government has shortlisted three tenderers for the work, and all are major US tech companies.
The three remaining bidders are IBM, Pega in partnership with Accenture, and an Oracle, PwC and Sayers consortium. The government is expected to pick the winning bidder within the fortnight.
The “scalable, innovative” platform would be an “integrated, enterprise-scale workflow capability to be used across the Commonwealth, not just by Home Affairs”.
But the CPSU said this work could be done cheaper and more effectively by APS staff, and they were never given the chance to make their case or pitch for the work before a tender was issued late last year by the DTA.
“CPSU members know that they have the skills and experience to deliver this project for the department,” CPSU assistant national secretary Michael Tell told InnovationAus.
“But they were not given an opportunity to make a case that the work be done in-house. It’s yet another example of the rush to use consultants, contractors and external vendors for work that could and should be done by the public service itself,” Mr Tell said.
“We believe that there are strong arguments, on both cost and capability development grounds, for the government to reconsider the decision to go for a complete external build.”
The CPSU has written to Home Affairs requesting a meeting about the issue, with plans to also write to Home Affairs Minister Peter Dutton and the Parliament and request it be investigated by the current senate inquiry into the capability of the Australian Public Service.
It is the third time in recent years that the federal government has attempted to outsource the development of a new visa processing platform.
In 2006 work began on the Generic Visa Platform, which was built by IBM as part of the $520 million Systems for People program.
Five years later, after a spend of about $450 million, the platform was launched. But it was only in operation for less than a year before it was decommissioned because it was not fit for purpose.
Then in 2016 the Coalition embarked on the development of the Global Digital Platform, a digital visa platform. It spent more than $90 million on the project, which never made it past the tender phase, including $65 million on external consultants.
The project was shuttered early last year following ongoing conflicts of interest with the tenderers.
This is the third time that the government has attempted to outsource this core government function, but in the meantime the system developed in-house by public servants has proven effective, Mr Tull said.
“The previous two were expensive failures. But in between those two failures there was a project that worked – and in-house built – where APS staff built the visa system and tools that have worked successfully for years. Despite that history, the department and government have again opted for an external provider,” he said.
“There has been a number of reviews and reports that have pointed to the need to reduce the reliance on external providers and build internal APS capability. Most recently the Chief Statistician, David Gruen, who heads up the new APS Data Profession, has said that there is a need to build ‘native capability’ and have key skills in-house.
“I’d say that a permissions platform that is intended for use across multiple departments is indeed a key capability the APS should further develop in-house.”
The union is not pushing for the entire project to be completed in-house, but for it to be led by the public service in partnership with local tech firms.
“We don’t say that every element of the work has to be in-house, and there may well be specialist solutions or other elements of the work that will require external involvement and would present opportunities for Australian businesses to be involved, but we do say that major projects like this are generational opportunities to build on the existing skills and capabilities of the APS,” Mr Tell said.
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