The biggest Australian govt IT suppliers, ranked

The biggest IT spenders in the federal government and their favoured suppliers have been laid bare in an analysis of publicly available procurement data by the national auditor.

The Australian National Audit Office (ANAO) trawled through the last five years worth of records on Commonwealth procurement site AusTender to provide greater transparency on procurement activity in the Australian public sector.

Its analysis reveals that from 2012-13 to 2016-17, just under $36 billion was spent on IT, telco, engineering and research, and technology services.

The ANAO grouped the categories into one, which for brevity iTnews has shortened to 'IT' for the remainder of the article.

In the 2016-17 year alone, $5.7 billion was spent across government on IT.

It made IT the fourth largest procurement category in the Commonwealth for the past five years, behind commercial, military and private vehicles at $42 billion; management, business professionals and admin services at $39 billion; and "other" at $37 billion.

The Department of Human Services proportionally spent the most during that period on IT, allocating about 44 percent of its total procurement spend on the category.

It was followed by Finance at about 37 percent of total procurement spend, and the Department of Veterans Affairs (DVA) at about 34 percent.

However the ANAO noted that Finance, at the time, was responsible for several whole-of-government procurement initiatives, and also pointed out that DVA had quite a lot of potential duplicate contract entries for temporary IT personnel on AusTender.

But the most dollars on IT actually came from the Department of Defence, which handed out more than $15 billion over the five years to IT suppliers. DHS was far behind in second spot at $3.2 billion.

The year of highest IT spend across the Commonwealth in the last five years was in 2014-15 at about $7.2 billion, with 2015-16 not too far behind at around $7.1 billion.

Where did the money go?

The ANAO analysis revealed IBM was by far the leading government IT supplier to the Commonwealth from 2012-13 to 2016-17 in terms of dollar value.

IBM brought in a total of $2.3 billion over the five years across government for its services.

In second spot was Boeing, which took $1.6 billion worth of IT work, followed by the former Lockheed Martin, Fujitsu, Abacus Innovations (the reborn Lockheed-Leidos IT services business), Data#3, Telstra and HP. The remaining 23 top IT suppliers can be found here.

However, IBM was further down the list when it came to the actual number of contracts: while it may be bringing in the most money, it did so from only 692 deals.

The award for the largest number of contracts across the Commonwealth went to Data#3, which had 1689 agreements under its belt over the five years for a total of $902 million in value. Closest behind was HP with 1517 IT contracts, followed by Dell with 1457.

Interestingly Microsoft, which didn't make the list of top IT suppliers, did appear on the list of top consultancies - coming in 15th with procurement revenue of $246 million for the period.

It's worth noting that much of Microsoft's government revenue would likely come through its reseller channel and the likes of Data#3.

What are they spending it on?

A more detailed analysis of IT contracts shows the biggest portion of spend hasn't actually been properly categorised by agencies in AusTender - it falls under the "other" category, which can basically mean anything within IT, telco, and engineering.

The issue of inaccurate contract reporting more broadly has been on the ANAO's watchlist for a while now. Its most recent audit found that only 41 of 155 contracts examined correctly reported all details.

General issues revolve around a number of things including incorrect categorisation of procurement.

Regardless, after the popular "other" category, most IT procurement money went towards computer services, IT components, communications devices, and software.

The computer services category is often used for the procurement of temporary IT support workers.

The ANAO said it removed the government's 20-year, $6.4 billion contract with Telstra for universal service obligations from its analysis to better reflect IT procurement contract values.