Federal government agencies are set to bring $49 million worth of technology services in-house as part of a push to cut contractor numbers in the public service.
Figures released today by Finance Minister Katy Gallagher reveal that $527 million worth of “core work” is to be brought back in-house in 2024-25 across 104 government agencies.
The announcement comes a year after Gallagher first revealed the government’s push to phase out contractors and consultants in the Australian Public Service via the Strategic Commissioning Framework.
According to an update to the framework, which includes an overview of each agency’s 2024-25 target, ICT and digital will account for 22 percent of this core work, with the exception of Defence.
Defence itself bore the biggest brunt of the outsourcing cuts with a total reduction of $308 million but did not break down specifics of which work would move in-house.
However, in the recent iTnews Podcast, Defence CIO Chris Crozier revealed that the department’s tech delivery was now at a 60:40 ratio of staff to contractors, down from 80:20.
The Australian Taxation Office earlier revealed it would be looking to reduce $31.9 million in 2024–25 in outsourcing expenditure for IT, service delivery and data analytics work.
In the framework report, 67 departments and agencies identified the grouping of ‘ICT and digital’ as core systems, with 55 of these outsourcing at least some part of it.
“Agencies report widespread outsourcing of core work in this job family and note it is difficult to bring in-house,” the report stated.
Since taking office in 2022, Gallagher has made it her mission to reduce dependency on consultants and contractors in the APS, especially following an earlier senate finding that the APS had an “unhealthy reliance on IT contractors”.
“When coming to government we set out with an ambitious agenda to reform the APS, and to strengthen capability, to ensure the APS can deliver the services Australians expect,” Gallagher said in a statement.