Turnbull's Digital Transformation Office to cost $95m

The federal government has set aside more than $95 million to establish the Digital Transformation Office inside Malcolm Turnbull's Department of Communications, part of a $255 million pool targeted at enhancing the public sector's digital credentials.

Malcolm Turnbull

The establishment of the DTO is forecast to cost $95.4 million over four years from 2015-16. It will exist as an 'executive agency' within the comms portfolio.

Turnbull has previously indicated the DTO will likely employ around 100 staff, give or take project fluctuations.

Today's federal budget outlook states the average staffing level of the office is "yet to be determined", but the employee count at the Department of Communications is expected to drop by 22 to reflect staffing shifts to the DTO and the office of the Children's e-Safety Commissioner.

The DTO's opening does not, however, appear to have impacted staffing levels at the Department of Finance - the former home of whole-of-government IT authority - which is forecast to gain three extra staff members in the coming year.

Budget wrap: All the tech

Budget papers also outline the first activities that will form the DTO's agenda as it formally kicks off operations in the new financial year.

Its most expensive job will be building a $107 million common grants management platform across government.

The single portal will deliver a single site for grants seekers to search and apply for opportunities, and agencies will be expected to align the way they process grants programs with the new scheme.

Just over $33 million will go towards a "trusted digital identity framework" to verify both individuals and businesses when they transact with government.

The Government has earmarked another $11.5 million to allow users of government services to update their contact details with all federal agencies in one go - an objective that has been on the agenda for some years.

It will also spend $7.1 million delivering a secure digital mailbox for government communications.

Ovum's lead e-government analyst Kevin Noonan said after a disappointing 2014 budget for IT, he welcomed the news Canberra is finally putting its money where its mouth is.

"It is now clear Government has got the message that IT is not just a cash cow for savings," he said.

"They are backing up their rhetoric with actual money."

However, the "feast and famine" cycle of budget spending meant the local IT industry would now have to prepare itself to meet the flood of government buying demands, he said.

Pay your share

Budget papers also revealed that agencies will be asked to pitch in to pay for the digital transformation agenda.

The Government did not specify who will be asked to deliver savings to pay for the cause, but indicated that "agencies within portfolios that are involved in the digital delivery services" are most likely to be on the list of contributors.

It is looking for a total of $120 million over five years, including $44.7 million in 2015-16 out of the whole-of-government savings pool.

The modernisation agenda has also extendend to the Department of Human Services, which is eyeing off $55 million worth of savings, partially from phasing out cheques and electronic benefits transfer cards for welfare payments through Centrelink and Medicare and pharmaceutical benefits scheme refunds.

The payments will instead be paid directly into the bank accounts of recipients.