Defence given $48m buffer for distributed computing

The Department of Defence has revealed the full funding envelope covering last-minute extensions to its distributed computing contracts could be much higher than previously quoted.

Photo courtesy Department of Defence

In January the department announced it had too much on its plate to go through with a scheduled market refresh of the bundle of server and desktop infrastructure support deals that currently sit with Fujitsu and Unisys.

Instead of inviting new bids for the contracts, which are worth hundreds of millions of dollars over several years, Defence re-extended them out to 2015 and 2016 to give it more time to prepare for the mammoth task.

A three-year extension to the Fujitsu deal was announced as being worth $170 million to the vendor.

However contract notices subsequently published by Defence on the AusTender show the deal could exceed $200 million.

Similarly, the two-year extension to the Unisys deal that was quoted at $52 million by the vendor has shown up on AusTender with a full possible value of $69.9 million.

A spokesperson for the department said “the figure that is automatically posted on AusTender is the maximum approved value of the contract”.

“The figures in the media releases are the current expected contract values."

The postponed contract consolidation and market refresh will form part of a broader IT reform program within Defence aimed at saving $1.9 billion.

It has already bundled a range of telecommunications contracts into a single, $1.1 billion deal with Telstra.

It said it is still on track to sign a new data centre outsourcing deal with one of shortlisted tenderers IBM or Lockheed Martin imminently.