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B – Related government policies

The following procedural requirements relevant to certain project proposals are intended to improve the quality of proposals, to support well-informed investment decisions and to check that proposals are aligned with Government strategies. These requirements are periodically updated; the most current details are available through the web sites for the Department of Finance and Deregulation (Finance), and the Department of Prime Minister and Cabinet.

The ICT Investment Framework

Finance provides information on the ICT investment framework at <http://www.finance.gov.au/budget/ict-investment-framework/index.html>. Advice on any recent enhancements and on the detailed operation of the Framework is available by contacting the Department. Three elements of that framework are the ICT investment principles, the ICT Two Pass Review process and organisational capability.

ICT Investment Principles

Principle 1: Government should be provided with sufficient information from an agency and whole-of-government perspective to enable appropriate assessment of allocation of funds for ICT-enabled business change programs and projects.

Principle 2: Agencies are responsible for the effective, efficient and ethical use of resources to deliver the Government’s requirements (section 44 of the FMA Act). Agencies will ensure they have adequate governance and monitoring processes in place to achieve this.

Principle 3: Investments in new business capability involving ICT should be justified by and measured against costs and benefits.

Principle 4: Agencies are responsible for measuring the outcomes achieved by ICT and the return on the investment in ICT and for sharing learnings across government at key points in each projects’ lifecycle.

Principle 5: Finance is responsible for developing, in consultation with agencies, the Frameworks that assist agencies to achieve the efficient and effective use of ICT by the Australian Government. Finance will do this through: facilitating reuse, interoperability, sharing and collaboration; encouraging use of standards; and strategic guidance to agencies and advice to Government on ICT investment.

Principle 6: Central agencies will support agencies to enhance skills in managing ICT investments, by co-ordinating the provision of information, tools and training.

ICT Two Pass Review

The ICT Two Pass Review process helps obtain better information to support Government decisions on major investments in ICT-enabled proposals, and also better positions agencies for the Budget and Gateway Review processes.

Proposals are subject to the ICT Two Pass Review process if they:

  • are ICT-enabled (that is, the policy or service delivery outcomes are highly dependent on the underpinning ICT system);
  • have a total cost estimated to be $30 million or more, including ICT costs of at least $10 million; and
  • involve high risk in terms of cost, technical complexity, workforce capacity or schedule.

The Government may also apply the process to other proposals where it considers the proposal would benefit from the review. The process does not apply to proposals from the Department of Defence, which has its own two pass review process.

Organisational Capability (P3M3™)

Agencies subject to the Financial Management and Accountability Act 1997 (FMA Act agencies) are implementing the Portfolio, Programme and Project Management Maturity Model (P3M3™) as a common methodology for assessing their organisational capability to commission, manage and realise benefits from ICT-enabled investments. This initiative commenced in 2009 as part of the Government’s response to the recommendations of the Review of the Australian Government’s Use of ICT and aims to strengthen governance of the lifecycle of ICT investment including business domain activities such as requirements definition and benefits realisation.

The Gateway Review Process

The Australian Government has introduced the Gateway Review Process42 to support the on-time and on-budget delivery of major projects undertaken by Financial Management and Accountability Act 1997 (FMA Act) agencies. The arrangements are coordinated by the Gateway and Training Branch, within Finance.

Gateway is a project assurance methodology that involves short, intensive reviews at critical points in a project’s lifecycle by a team of independent reviewers (the Gateway Review Team). The Gateway methodology consists of six defined stages (Gates), which are aligned with a project’s lifecycle. The gates are: 0 Business Need, 1 Business Case, 2 Procurement Strategy, 3 Investment Decision, 4 Readiness for Service and 5 Benefits Realisation.

Gateway reviewers are experts in their field, who have extensive relevant experience and have been accredited by the Gateway and Training Branch. The appointment of members to the Gateway Review Team for a project is based on the risk level identified through the Gateway Risk Assessment Tool – an Excel-based tool used to assess the inherent risk of projects, available from <www.finance.gov.au/gateway/gateway-risk-assessment-tool.html>. A Gateway Risk Assessment must be completed and submitted to the Gateway and Training Branch for all project and procurement proposals where the project:

  • is to be considered by the Australian Government;
  • will be managed by an agency that is subject to the FMA Act; and
  • is costed at or above the relevant Gateway cost threshold of $10 million for information technology projects and $20 million for other procurement and infrastructure projects.

The Government may agree to apply Gateway to projects that meet the financial threshold and are assessed as high risk after completion of the Gateway Risk Assessment Tool. Further information is available from <http://www.finance.gov.au/gateway/index.html>.

Implementation requirements administered by the CIU

New Policy Proposals are required to include an implementation statement. The Cabinet Implementation Unit (CIU) will request implementation plans from agencies where the initiative is a key government strategic policy that the CIU is monitoring.

The CIU is part of the Department of the Prime Minister and Cabinet. The CIU helps the Prime Minister and the Government manage and deliver the Government’s strategic reform priorities, including reporting to the Prime Minister on progress with the delivery of these priorities across the Australian Public Service. A range of project management and implementation resources is available on the CIU’s website, <http://www.dpmc.gov.au/implementation/index.cfm>. These include:

  • Guidelines for Cabinet Submissions and New Policy Proposals;
  • Implementation Plan Guidelines;
  • Program and Project Management Support; and
  • Further resources across the Australian Government, states and territories, international, and other networks and contacts.

42: Department of Finance and Deregulation, Financial Management Guidance No. 20 Guidance on the Gateway Review Process – A Project Assurance Methodology for the Australian Government.