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Aussie govt IT spending to crack $15B

Aussie govt IT spending to crack $15B

Software to be the fastest growing IT government segment both locally and abroad.

Credit: ID 86533115 © Semisatch |

Australian government IT spending in 2022 is expected to grow 8.8 per cent year-on-year to $15.5 billion — outpacing the global growth rate average of 6.5 per cent, to US$557.3 billion.

The bulk of the local spend is set on the IT services segment, which is expected to grow by 7.2 per cent up to $6.4 billion by the end of next year, according to research firm Gartner.

As a point of comparison, global government IT spending on services has been predicted to grow over the period by 8.4 per cent, to US$203.9 billion. 

The segment with the fastest growth both in Australia and globally is anticipated to be software, rising up 19.2 per cent locally to $4.7 billion and 12 per cent globally to US$151.9 billion. 

The only segments not to expect growth  in Australia are devices, with a decline of 5 per cent to $651 million, and telecommunication services, dropping an estimated 1 per cent to $659 million. 

If the 2022 prediction occurs, this would see it surpass the predicted local spend of $13.2 billion for 2021.

The increase in spending is expected to stem from “unprecedented public demand”, Gartner stated, with over 50 per cent of government agencies predicted to have modernised their critical core legacy applications by 2025.  

“Key national technology capabilities, whole-of-government cloud and SaaS [software-as-a-service] procurement agreements and digital skills have progressed at a federal level within Australia,” said Brian Ferreira, vice president of executive programs at Gartner. 

“We have also seen a strengthening digital mandate in ministerial roles with cross federal/state collaboration at a state level.” 

Regardless, government spending on technology is set to keep growing for the short-term, past the reported period, Ferreira claimed. 

“Government technology spend in Australia is expected to continue upward for the next few years driven by key programs to progress the digital economy, strengthen national cyber response, adopt emerging technologies and address gaps in regulation to cover technology,” he said.  

“Consultation papers on AI [artificial intelligence], ethics, technology and human rights, blockchain and other emerging technologies are now firmly on the government’s radar.” 

He added that future government IT spending opportunities are likely to focus on solutions that open Australia’s economy, particularly those around vaccination validation, opened borders and trade unblocking. 

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