Most of the swingeing cuts will be directed to middle class welfare like the baby bonus, and to a tightening of corporate tax payment schedules. Federal Government Treasurer Wayne Swan did not mention IT in his announcement – all programs that have been announced will continue for the rest of the financial year.
Indeed, it is possible that IT may benefit, as agencies seek efficiencies in a number of areas. “Last year’s MYEFO statement announced substantial cuts to public sector running budgets and capital expenditure,” says Ovum’s Kevin Noonan. “With these cuts still washing through government agencies, further cuts would have created significant problems.
“This is particularly the case, given the already announced tightening of government funding in September. This is mainly related to contractors, travel and printing. With many government agencies now running on the smell of an oily rag, future savings will need to come through productivity and innovation, rather than old-fashioned cross board cost-cutting.”
The NBN is unaffected, as is funding for the Department of Broadband, Communication and the Digital Economy. Prime Minister Gillard has been prominent recently in promoting the benefits of the NBN – it would seem to be immune from the razors and hatchets of the Finance Department and Treasury fixation on a balanced budget.