Finance Minister Lindsay Tanner says the Australian Government is on track to save more than $1 billion on its business-as-usual information and communication technology expenditure, as recommended in Sir Peter Gershon's review of government ICT usage.
The Government has identified $430 million in savings over four years in a second round of ICT budget reductions to begin in the 2010-11 financial year.
During this second phase of the program, government agencies developed approximately 250 savings initiatives, according to a spokesperson for Tanner's office.
The government expects about 28 percent of the savings to come from extending the life of computer hardware, such as desktops, servers and laptops, and reducing the amount of this infrastructure.
The Government anticipates another 23 percent of the savings from reducing application maintenance services and renegotiating existing contracts. The remaining savings would come from "realigning ICT management, reducing the numbers of ICT BAU contractors, reducing expenditure on wide-area networks and rationalising software and applications used in agencies," Tanner's spokesman said.
Tanner's office was unable to provide an estimate of the number of ICT management staff or contractors who might be 'realigned' or reduced.
The Government has committed to reinvesting half the savings in projects that further increase ICT efficiency.
"The Government is considering proposals for the ICT BAU Reinvestment Fund that cover a broad range of categories, including legacy system replacement; improvements to telephony facilities; infrastructure to consolidate existing systems or for virtualisation; and data management," Tanner's spokesperson said.
Tanner says he hopes to announce the first of these projects "in the coming months".
The Government completed the first phase of the expenditure reduction program in April 2009, identifying $109 million in savings for the first year - a downgrade from Gershon's initial estimate of $140 million - and a total of $570 million over four years.
This included $7 million in savings by converting approximately 200 full-time IT contractor roles into public service staff positions.
In an interview with iTnews, Tanner identified a strong potential for savings in printing technology and extending the life of hardware assets such as desktop computers.
"We are cautiously optimistic about the ability of these types of developments to produce further efficiencies," he said at the time.