ATO rethinks IT contractor arrangements

The Australian Tax Office will review its IT contractor panel which includes the likes of Data#3, Deloitte, Fujitsu, UXC, Oakton and PricewaterhouseCoopers.

The tax office is looking to reform the process by which it hires IT contractors, reviewing a panel arrangement on which it spent $36 million on the last financial year.

Early last month the ATO commenced a program to identify how it can achieve lower, ongoing cost reductions, better contractor performance and retention, more efficient engagement of contractor resources and greater procurement accountability and transparency. 

According to an ATO briefing to industry, the agency's current IT contractor panel - which has been in use for over 10 years - has not kept up with changes to recruitment practices in the wider ICT industry, and “may not be an effective long-term solution”. 

The department's goal is to make the panel simpler for industry participants, as well as more efficient and cost effective for the ATO. 

“The [program] .. will review the current procurement processes... and has the potential to change the way in which IT contractors are sourced by the APS," ATO CIO Bill Gibson told iTnews.

"It will also reduce red tape and overall cost to the ATO."

An ATO spokesman declined to comment on whether the review would slim down the list of contractor providers on the panel, nor on how it expects to achieve cost reductions. 

The current panel has around 48 members, including the likes of Data#3, Deloitte, Fujitsu, UXC, Oakton, and PricewaterhouseCoopers, among others. 

The ATO spent $36 million on the panel (for contracts worth more than $10,000) in the financial year from July 2012 to June 2013. 

The ATO will host an industry briefing on April 11 for an audience of IT contractor and labour hire providers, recruitment agencies and payroll service providers to discuss the reform agenda and the industry’s involvement, specifically around best practice and engagement models.

The office is looking to use as a reference point the “many effective established models” in place in the private sector, which were described as a “far more efficient and effective than those being used by the ATO”.