DTA signs single sourcing agreement with Microsoft

The Digital Transformation Agency (DTA) has awarded Microsoft a fresh five-year whole-of-government volume sourcing arrangement, which will commence in July.

The agreement will allow the Australian Public Service to source Microsoft’s core enterprise and cloud product stack at volume discounts, with stable pricing and capped price increases over the term of the deal. The arrangement also includes enhanced legal provisions with better governance, reporting and liability clauses, as well as regulations for the handling and use of sensitive government data.

Products covered under the agreement include Microsoft Copilot, Microsoft 365 (Office, Teams, SharePoint, Exchange), Azure cloud services and Dynamics 365, as well as a line of security and identity services.

As part of the agreement, Microsoft is also making available a $1.55 million training fund to deliver tailored skills training, including training on ethical AI use, to members of the Australian Public Service.

According to DTA CEO Chris Fechner, the agreement will strengthen the government’s ability to operate critical ICT infrastructure in the future.

“We are partnering closely with agencies to deliver a smooth and coordinated transition to the new arrangement,” he said.

Fechner said the agency’s recent review of government Single Seller Arrangements found that the agreements achieved $1.6 billion in discounts between 2019 and 2024, while improving commercial terms, strengthening legal and data protections, and reducing complexity for agencies.

“The recent review of our Single Seller Arrangements confirmed their value in delivering stronger protections, better terms and significant cost savings for the Australian Government,” he said. “Building on these strengths, the Microsoft [agreement] will deliver benefits for all agencies, particularly smaller entities, while supporting the government’s digital transformation agenda.”

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