Government falls short of Gershon contractor target

An Australian Government plan to reduce its reliance on ICT contractors has fallen dramatically short, with one in three agencies missing the target.

Australian Government CIO Glenn Archer.

In 2008, Government agencies were asked to reduce the number of ICT contractors working within agencies by 50 percent by 31 December 2011.

A cull of contractors was one of the main recommendations of Sir Peter Gershon’s review of the government’s use of ICT, which uncovered an overreliance on ICT labour hire.

Australian Government ICT expenditure benchmarking data released by AGIMO in May 2013 revealed that external labour as a proportion of the total ICT workforce dropped from 23 percent in 2008-09 to 21 percent in 2011-12.

Correlating that figure with the total number of Government ICT staff, and balanced with the 3,135 contractors reported in the Gershon Review, this suggests that the policy removed the number of contractors by 11 percent, well short of the 50 percent target.

Australian Government Chief Information Officer Glenn Archer agreed that the government fell short of its mark.

“Of the 34 agencies that were subject to the decision, 18 met the reduction target, four came within five contractors of meeting the target -  which is within the margin or rounding, 11 agencies did not meet the target and one agency was given and extension out to the end of 2013,” Archer said.

“It is true to say that about a third of all agencies did not achieve the target”.

Archer said that regardless of the target, the Government spends less on contractors, in keeping with the sentiment behind Gershon’s plan.

“ICT costs as a proportion of all operating costs are going down, as is the overall cost per ICT staff member," he said. “I think many agencies have been very successful in either constraining or reducing their contractor rates over the course of the past few years."

Peter Acheson, CEO at one of the largest suppliers of contract labour to the Federal Government Peoplebank, says he is not surprised that some agencies failed to meet their targets as focus on the program dropped off towards the end.

“It was very effective for the first couple of years," he said. "There was a substantial rate of conversion of contract staff working within the government into permanent roles.

“The government’s focus has shifted more recently when it began to achieve its financial objectives. Whether the policy has left a non-financial legacy is still probably up for debate,” he said.

John Vassallo from recruitment firm Compas added that a lack of experience amongst less senior levels of APS staff makes it hard for agencies to operate without the assistance of contractors.

“Permanent staff that are good at their jobs are promoted quickly into senior management roles. That means that the people left in technical and developer roles within the government are either very new to IT or are not skilled enough to get a promotion.

“When a project needs to be done well and done quickly the government will call in contractors because they don’t necessarily have the competency and experience within the technical levels of government,” he said.