Budget highlights IT security

The Howard government's election budget holds few surprises for the IT sector, with security agencies the biggest winners for the third year running.

Treasurer Peter Costello's budget included a raft of opportunities for IT vendors, hefty increases in funding for security agencies and changes to the Australian government IT infrastructure.

While it's mainly a family focused budget that promises to cut income taxes and lift family benefits, the budget has also added to investment in IT and infrastructure to increase protection for Australia from criminal threats and identity fraud.

In terms of increased ICT funding this year, government regulatory authorities were easily among the biggest beneficiaries with the budget promising $755 million over five years on new technology for improved security. This windfall is expected to be assigned to boost data mining, increase intelligence, upgrade information security, protect infrastructure and develop biometric technology across a diverse range of portfolios.

Some government agencies that would receive reinforced funding for IT initiatives included ASIO, Austrac, the Australian Federal Police, the Department of Communications, IT and the Arts (DCITA), Customs and Defence.

For the business community, particularly the big end of town, the 2004 budget held no nasty surprises. Instead it was fairly benign. Corporate australia was denied any significant tax cuts. And, while the projected cash surplus of $2.4 billion is expected to ease the pressure on interest rates, the corporate tax rate is not expected to ease.

The Business Council of Australia expressed concern the budget "contained no significant recognition of the contribution of the corporate sector and its capacity to sustain this sort of performance into the future".

BCA's president Hugh Morgan said alhtough corporate Australia is performing well, "there are some worrying trends in the corporate tax system which, if not addressed, will impact on the contribution large business makes over the longer term".

Other budget highlights and announcements include:

Telstra

Despite opposition from the Senate, the budget papers reveal that the full sale of Telstra remained on the federal government's agenda.

In a statement accompanying the 2004-05 budget papers, Finance Minister Nick Minchin said the budget continued to provide for the sale of the remaining stake in Telstra. However, the government was forced to defer its timetable for the next sale from 2005-06 to the 2006-2007 fiscal year.

“Given the rejection of the further sale legislation twice in the Senate, and the long lead time required for sale preparation, it would now be difficult to achieve a sale in 2005-06," Minchin said.

Forward projections showed the government expected asset sale proceeds of $11.28 billion in both 2006-07 and 2007-08, taking into account the sale of some of the government's 51.05 percent stake in the telco.

The government also noted that the amount of money raised by the sale would depend on the state of the world's equity markets at the time.

Security

In total, the government has committed $3.1 billion over the seven years since 11 September 2001 for a range of national security initiatives. The 2003-04 budget has bolstered last year's $1.3 billion for Australia's domestic security, with a further $755 million for the Investing in Australia's Security package.

This includes:

* An additional $411 million over five years for a package known as 'A Safer Australia' for initiatives aimed at safeguarding infrastructure, protective guarding and enhancing intelligence.

* The government will provide $270 million to Australia's intelligence gathering agencies. Over four years the Australian Security Intelligence Organisation (ASIO) will receive $127 million, the Australian Secret Intelligence Service (ASIS) $46 million and Defence's intelligence operations and analytical capability a further $47 million. The money is expected to be invested in intelligence building capabilities.

* Protective security will be upgraded with initiatives of $207.1 million in this budget. Government agencies would also receive additional funding to improve critical infrastructure protection.

* The budget has assigned $87 million to improve law enforcement cooperation in the region and assist its capacity to respond to terrorist attacks, particularly through the Australian Federal Police.

Biometrics

Within these security initiatives, the government is bolstering its spend on biometrics to control identity fraud at borders.

Funding of $150.3 million has been assigned to secure Australia's borders, including $9.7 million to assist the development of “more robust identity verification processes utilising biometric technology and an integrated global visa processing system”.

Research and development programs into biometric applications, currently being run across the Department of Foreign Affairs and Trade (DFAT), the Australian Customs Service, and the Department of Immigration and Multicultural and Indigenous Affairs (DIMIA), will receive $9.7 million.

The budget allocated $2.2 million to DFAT to trial a prototype biometric passport to ensure its compatibility with border control equipment to be used in the United States.

A further $40 million was earmarked to improve Australia's incident response capability, which includes improvements to the biosecurity surveillance system.

The Department of Immigration and Multicultural and Indigenous Affairs (DIMIA) was allocated $4.4 million to conduct research on the use of biometric technologies in Australia's existing electronic visa and entry arrangements. DIMIA will establish a centralised biometric database.

Customs would receive $3.1 million for its automated facial recognition system known as Smartgate.

The government said that identity fraud in Australia cost the community about $1.1 billion annually.

AGIMO

Interestingly, the Australian Government Information Management Office (AGIMO), which replaced the NOIE (National Office of the Information Economy), would return $2.7 million over three years from 2005-06 to the budget as part of the transfer of its responsibilities for procurement information systems to DCITA. The new office will only receive $20.115 million -- half the previous year's budget for the NOIE -- for its first year of operation, forcing the government to deliver IT savings and efficiencies through its whole of government IT strategy.

Critical infrastructure

The federal government has allocated more than $50 million over four years to safeguard critical infrastructure in Australia such as electricity grids, data centres and telecommunications networks. The government identified the objectives as “minimal single potential points of failure and rapid, tested recovery arrangements”.

This funding provides resources for nine government agencies for a range of activities to progress three key areas of critical infrastructure protection. Specifically this comprises the provision of expanded Secretariat support to the Trusted Information Sharing Network for Critical Infrastructure; infrastructure vulnerability identification, analysis and remediation -- including activities such as the testing of Australian government and private sector national information infrastructure; and infrastructure interdependence modelling and analysis.

The government's Critical Infrastructure Protection strategy, including the Trusted Information Sharing Network (TISN) would receive $5.5 million ov