Australian Government

Australia Adopts Cloud First Policy With Possible Taxpayer Savings Up to 30 Percent

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The Australian Federal Government released its new cloud computing policy document officially adopting a cloud first approach. According to the document, “under the Government’s Cloud Policy agencies now must adopt cloud where it is fit for purpose, provides adequate protection of data and delivers value for money.”

The report claims that the new initiative “will reduce the cost of government ICT by eliminating duplication and fragmentation and will lead by example in using cloud services to reduce costs, lift productivity and develop better services.”

Despite the possible cost savings, the data gathered by the government shows the use of cloud services has only been modest so far. Since July 2010, cloud procurement totaled $4.7 million. The data center multi-use list only shows $1.5 million in spending since October 2012.

In May, the Australian Audit Commission found that adopting a cloud first initiative could save the government up to 30 percent. The commission report recommended “…the Department of Finance establish a whole of government cloud computing provider panel to confirm the viability, capability and costs of large-scale cloud computing providers. Agencies could then obtain quotes for such services as the need arises.”

The government began to move forward with this recommendation by making it easier for agencies to move to offshore clouds in August. It’s previous policy of requiring two ministers approval before moving to an offshore cloud was revoked. The approval process now requires agency heads to consider the risk assessment before outsourcing IT to an offshore cloud.

In May, Queensland moved ahead of the federal government in instituting its cloud first initiative right away rather than waiting until after the 2014-2015 budget as was originally suggested by the federal government.

This initiative represents a growth opportunity for both Australian and foreign service providers. “I think the change will help governments move data to the ‘appropriate clouds’ and create further demand which is good for the industry. Departments should have a set of guidelines that classify data types and departments should be able to operate within that without extra Ministerial approval,” Craig Deveson, CEO of Australia’s Cloud Manager Inc. told the WHIR in an email in August. “With increased competition locally there is less need to move data offshore because the cost differences between locally hosted and offshore continues to come down.”

According to the new cloud computing policy document, the Australian government spends approximately $6 billion on ICT services each year. If state and territory governments are included this expense accounts for about 30 percent of the domestic market.

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