Govt fails Gershon contractor targets



blog Remember how then-Finance Minister Lindsay Tanner commissioned British efficiency expert Sir Peter Gershon back in 2008 to undertake a review of the Federal Government’s use of ICT? Remember how one of the conclusions of Gershon’s review was that departments and agencies were asked to drastically reduce their use of external contractors? Of course you do. Well, according to iTNews (we recommend you click here for the full article), the Government has broadly failed to meet those targets. The publication reports:

“Australian Government ICT expenditure benchmarking data released by AGIMO in May 2013 revealed that external labour as a proportion of the total ICT workforce dropped from 23 percent in 2008-09 to 21 percent in 2011-12 … this suggests that the policy removed the number of contractors by 11 percent, well short of the 50 percent target.”

To be honest, we can’t say we’re surprised. Gershon’s recommendations were met with derision from many with knowledge of the Canberra workforce situation at the time, and it was surmised by many that the dropped contractors would eventually regain contracting positions are major departments and agencies, for the simple reason that there really wasn’t any other way for those agencies to get the work done that they needed to. While there were many great outcomes of the Gershon review, this one was always one that was going to be hard to accomplish. This news will, however, add to the impression of many who keep an eye on goings-on in public sector in Australia, in that there is a general view that change — real, effective change — is very hard to come by in slow-moving Government circles.

Image credit: Phil Ragen, royalty free


  1. there is a general view that change — real, effective change — is very hard to come by in slow-moving Government circles.

    Not just in Government circles either, look how long it took Aussie retail to get on the “Online shopping” wagon…

  2. If they cut contractors by 50% productivity would drop sharpely lol. They would cut, miss milestones, then have to pay more in the long run recruiting all those contractors back. Seems like someone was playing politics when that report was released

    • I wouldn’t agree that “contractor = productivity” automatically. Just look at Qld Health…

      When used for specific tasks (certain projects/roles), they can be great value for money, but replacing your whole workforce with them is too general.

      • Contractors didn’t create the awards mess that is QHealth. Contractors didn’t implement the new contract structure mess in QHealth. Contractors didn’t sign off the purchase. These foundations were laid by the internal staff and their failure over many years up to the implementation and then after.

        • While they were not alone, the prime contractor did indeed have some fault laid at it’s door:

          Independent expert, Dr David Manfield, who was engaged by the Commission of Inquiry, said in his report that IBM must have recognised the complexity and size of the solution required well before they were awarded the prime contractor role.

          “IBM must have known the number of awards and the known existence of many business rules governing payroll and the likely difficulty in determining the business requirements and solution scope in such a short amount of time,” Dr Manfield said.

          “IBM must have been fully aware of this risk, in particular as it had an existing relationship with QLD Health.”

  3. Archer seems to be saying that 2/3 of the agencies did meet the target – so something happened. I think a lot depended on whether agencies were flexible enough to convert contractors into permanent APS staff, which often meant accepting the existance of technical jobs at higher classifications. Some public service managers can’t get their heads around that concept.
    The budget measure this year to reduce SES and EL1/2 staff will probably completely undo the gains.

    • In my experience with dealing with state and federal IT managers. Most are reluctant to go thru the process of hiring someone directly and will tender out the role to an contract agency because its a quicker hire that way

      The contract agency prevents having full-timers because you’d have to pay a percentage of salary take that personel onto your own payroll system.

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