All of the small business representatives on a government committee set up to remove barriers to government contracts for small IT businesses have broken ranks and delivered an unprecedented independent report to Minister for IT, Senator Coonan.
This independent report differs dramatically from the sanitised report that is the ‘official’ conclusion of the ICT SME Joint Industry Government Working Party and details the discrimination experienced by Australian small ICT businesses shut out of government contracts because of red tape, onerous and unreasonable insurance requirements and tenders that are deliberately designed to suit only very large ICT firms.
Small businesses drive 55% of revenues across the whole IT market and yet in the federal government, they barely reach 20%, even in the most favourable analysis.
Since 1996, the Howard Government has prevented small Australian IT companies competing on a level playing field in federal government purchasing, first through their IT Outsourcing Initiative which made contracts impossibly large and then by removing any obligation on agencies and departments to ensure small and/or local business involvement.
It is not surprising in these circumstances that since the Howard Government came to power, the ICT trade deficit has ballooned, highlighting the weak state of ICT exports, particularly manufacturing, and massive increases in ICT imports.
The discrimination against small business in federal government IT purchasing has contributed to this disturbing trend because for small business, a government contract represents an important export credential through a credible ‘reference site’. In other words, small business must be able to compete at home if they are to increase their exports and expand their size and capability.
Labor calls on the Howard Government to adopt the recommendations in this independent report because Australian small businesses are competitive on cost, quality and innovation, provided the red tape and discrimination is removed to allow them to compete.
Contact: Taryn Langdon 0417 148 059 or 02 6277 3334
