The $484m all-you-can-eat digital deal for Human Services

The Department of Human Services has inked a new procurement approach to engaging with major tech vendors, agreeing to a flexible five-year $485 million portfolio deal to use IBM’s services and consultants.

Canberra’s mega Department of Human Services has signed an innovative five-year, $484 million technology and services deal with IBM that lets the agency choose from a broad portfolio of services, products and expertise, rather than pre-described specific deliverables.

The procurement agreement is the first of its kind worldwide and provides the department with flexibility to consume products, services and expertise through a capacity on-demand model, supporting DHS’ major ICT transformation program. DHS includes the Department of Social Services and the Department of Health, as well as Medicare, Centrelink and the management of the child support program.

“The IBM agreement creates far more flexibility for the agency to exploit the depth and capabilities [of IBM] …”

The portfolio is undertaking a major transformation shifting users to digital platforms as well as replacing its creaking welfare platform that carried $166 billion in payments last year. The portfolio managed 124 million self-service transactions and engagements in 2014-15. Former ANZ bank CIO Gary Sterrenberg (pictured) is leading the major ICT overhaul.

This agreement does not cover the actual replacement of the payment platform (known as the Welfare Payments Infrastructure Transformation program, or WPIT). A tender for an off-the-shelf system is being evaluated for this platform. Some $60 million has been allocated to support the first tranche of this work.

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