Cloud buy outpaces “conservative” government ICT spend: IDC

By GovTechReview Staff
Monday, 31 March, 2014

Australian government departments will pursue more conservative ICT spending agendas characterised by imperatives to improve services, efficiency and transparency, a new IDC analysis has predicted.

Noting that Australian government spending on ICT would reach $5.61 billion this year – and grow to $5.88b by 2017 – IDC forecast a modest 1.3 percent compound annual growth rate (CAGR) for the sector over the next five years.CoreTec

Interestingly, the forecast spend on storage hardware – with a 6.9 percent CAGR – and software, with 5.7 percent – far outpaced the overall growth of the sector. The report attributed this to a “potentially growing cloud, and big data and analytics movement”.

Overall, however, the analyst group forecasted a relative slowdown in government ICT investments across the sector due to changes such as budget restrictions, a slowdown in spending as the previous Labor government wound down, and a shift to tighten infrastructure consolidation and efficiency.

Paired with the growing need for better government service delivery, IDC said, the current and future spending climate was likely to drive the creation of new engagement and business models that would drive new business-model innovations and the creation of new return on investment (ROI) benchmarks that will deliver new ways of measuring the success of government initiatives.

“The Australian government sector is on a transitional track towards whole-of-government citizen-focused services through the smarter use of ICT,” IDC Government Insights research manager Gerald Wang said in a statement. “Federal and State governments continue the investment focus on driving productivity through the adoption of new technologies to achieve cost savings whilst improving services.” – David Braue

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