Victorian public sector spending $3bn on ICT per year

The cost of Victorian public sector ICT projects has climbed to at least $3.02 billion per year, but government agencies are not in a position to demonstrate that taxpayers are getting value for money.

These were among the findings of an audit by the Victorian Auditor General’s Office into state ICT projects and initiatives.

For the three financial years ending in mid-2014, average ICT expenditure by Victorian government entities was $3.02 billion, the report shows.

This is the equivalent of 4.3% of average annual state operational expenditure and is more than double the estimated $1 to $1.5 billion in Victorian government ICT spending quoted in a 2010 industry report.

Of the total spending, $720 million went to capital expenditure and $2.3 billion was allocated or operational expenditure.

The $3 billion figure is a conservative estimate and does not include major expenditures including the $738.8 million myki Ticketing Solution spending by Public Transport Victoria over the three years.

But despite the significant expenditure, information on the status and outcomes of public sector ICT initiatives is difficult to obtain, with most agencies providing little if any such information.

“Victorian agencies and entities are currently not in a position to assure parliament and the Victorian community that their ICT investments have resulted in sufficient public value to justify the significant expenditure of taxpayers’ money,” the report states.

“The difficulty many agencies had in providing basic information raises concerns about the current level of scrutiny they apply to the status and performance of ICT projects as part of their governance processes.”

The audit also shows that 35% of the 1249 reported ICT projects went over budget, and nearly half of ICT projects were completed or are expected to be completed after their initially planned completion dates.

The report finds that the top two spenders over the three years were the former Department of Education and Early Childhood Development (DEECD) and Victoria Police. The top 6% of agencies in terms of ICT spending accounted for 66% of total annual spending.

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