AU government pushes SME access to ICT work

The federal government is encouraging small- and medium-size technology companies to partner with multinationals in a guide for gaining a share of Australia's multi-billion dollar government information and communications technology market.

Released today as part of an initiative by the Minister for Communications and Information Technology, Senator Richard Alston, to enhance the ability of small to medium-sized companies to compete for lucrative government ICT deals, the guide details ways of successfully bidding for government work.

The release of the document follows publicly-expressed fears from Australia's small-to-medium sized ICT contractors over the scope of their access to significant government business in the defence sector.

The guide also contains sections that instruct companies how to establish relationships with multinationals to bid for government work. The inclusion of the section continues theme Senator Alston pushed at an industry event earlier in the year when he advise small-to-medium sized companies to improve relations with multinationals.

Defence's procurement arm, the Defence Materiel Organisation (DMO), recently announced its intention to introduce a policy whereby it would only deal with Australian small-to-medium sized companies through prime contractors, rather than directly.

Spokesperson for Senator Alston, Simon Troeth said the federal government's recent emphasis on encouraging small-to-medium sized companies to partner was not foreshadowing a parallel policy for the wider ICT industry.

Troeth said that was "one suggested avenue" but that this was simply another path for small-to-medium enterprises to access the government market.

The executive director of the Australian Information Industry Association, Rob Durie, said that for many Australian small-to-medium-sized enterprises, partnerships would be the only means of gaining access to government work.

Durie conceded that it had been difficult for government to develop a policy for small-to-medium sized enterprises that befitted Australia's fractured ICT industry.

Under existing government policies, companies competing for contracts valued under AU$20 million must have a minimum level of participation from the small-to-medium-sized sector -- 10 and 20 percent for hardware and software contracts respectively.

Under the federal government's definitions, companies with revenues of up to AU$300 million can still fall under the small-to-medium policy threshold, leaving micro-enterprises to compete with companies with 2,000 employees.

Raising the threshold, said Durie, would unfairly punish medium-size companies for their success. He said that it would limit their chances of competing with offshore companies which can achieve scale more easily than Australian operations that are geographically cut-off from global markets.

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