Canberra's new 'strategic' SAP deal

The federal government has formed a new ‘strategic arrangement’ with SAP Australia, with the aim of simplifying IT procurement and achieving significant cost savings.

The agreement will “maximise the value of Government’s spend on commonly used IT by leveraging demand across agencies to achieve price reductions”, according to a statement released by Assistant Minister for Digital Transformation Angus Taylor.

“The SAP agreement will deliver savings through reduced duplication and administrative burden for departments,” he said.

“Government is driving hard to reduce costs so that it can invest in innovative new solutions. We know that a coordinated approach to ICT procurement works.”

Although the whole-of-government arrangement takes effect immediately for new and existing SAP contracts, it is not intended to mandate the use of SAP above other vendors.

According to a statement on the DTA website, non-corporate Commonwealth entities are required to use the new arrangement if they decide to use SAP products and services.

Taylor said the government is trying to break down the system of tenders and panels to let smaller IT players in.

“We’ve done the work to consult across government and with a number of major IT vendors to make sure we have fair and transparent arrangements in place,” he said.

“Combined, the first two iterations of the Microsoft Volume Software Sourcing Arrangement generated savings in excess of $200 million.”

Pictured: Assistant Minister for Digital Transformation Angus Taylor. Courtesy pmc.gov.au

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