SA delays $394m desktop outsourcing deal

South Australia's $394 million desktop outsourcing deal has missed a key deadline after the state government was forced to postpone the initial transfer of staff to IT services company DXC.

The deal has its origins in an open call for “innovative” IT pitches by the SA government in July 2015 to better coordinate the $100 million spent on IT by agencies each year.

The state government entered into an arrangement seven months ago to have DXC – formerly CSC – take over responsibility for the state’s full breadth of end user computing responsibilities, including the purchase of desktops, laptops and mobile devices, for up to the next ten years.

But a spokesperson from the Department of the Premier and Cabinet has confirmed to iTnews that initial activities on the transition have been pushed back.

The problems were first reported by The Adelaide Advertiser.

“This is a large and complex procurement involving tens of thousands of devices across Government,” the spokesperson said in a statement.

“The initial transfer of staff has been delayed to allow time for the project to be effectively delivered and managed.”

The Advertiser's report stoked fears of deeper problems on the project, including allegations that the deal could cost the government millions more than initially thought because of costs associated with integrating new hardware with old software.

iTnews was unable to independently verify the exact status of the project.

State Premier Jay Weatherill has previously called the deal a “win-win-win” for taxpayers, the government, and the economy, with expected savings of $11 million a year.