Big benefits for Government in new IBM deal

Release Date: 
5 July 2018
Media release

The Turnbull Government has signed a whole-of-government purchasing agreement with IBM which is expected to deliver more than $100 million in savings and benefits for taxpayers over the next five years.

The deal – worth an estimated $1 billion –­­ harnesses the bulk-buying power of the entire Government to secure the best possible prices for all departments and agencies, regardless of their size or how much they spend.

Previously, agencies have negotiated individually with major suppliers which often resulted in different pricing structures across government.

As a major buyer of IBM’s products and services, the deal enables us to maximise the return on our ICT investments and ensures that taxpayers are always getting the best possible value for money.

The deal has also been structured to enable small and medium-sized firms to engage with IBM through ‘channel partner’ arrangements to ensure they also benefit.

Services offered by IBM Australia include software solutions and IT support, cloud services, and the building and maintenance of IT systems.

As well as discounted prices, the new agreement contains other benefits such as access to software upgrades over the life of contract and other innovations being developed by IBM.

These additional benefits will help to future proof our ICT procurement against unexpected cost increases as technology rapidly evolves.

The deal also applies to more than $300 million worth of existing contracts with IBM which will now enjoy the same ongoing benefits.

Whole-of-government agreements align with the findings of the 2017 ICT Procurement Taskforce report which recommended a coordinated process be mandated for significant IT procurement and IT vendor relationships.

That coordinated process allows for better oversight of contract delivery and greater accountability of how public funds are being spent.

Since 2008, whole-of-government agreements have saved the Government about $1.2 billion.