Australian Taxation Office reduces IT outsourcing by $31.9Mn
SYDNEY, AUSTRALIA — The Australian Taxation Office (ATO) announced a substantial reduction in its technology outsourcing budget, aiming to cut $31.9 million in expenditures for the financial year 2024-25.
This decision is part of the ATO’s latest corporate plan, unveiled by Commissioner of Taxation Rob Heferen, which focuses on reducing outsourcing in core areas such as information technology, service delivery, and data analytics.
Aligning with federal government strategies
This initiative aligns with broader federal government efforts to decrease reliance on contractors, insource critical functions, and strengthen internal capabilities.
By reducing outsourcing, the ATO aims to enhance its internal data and analytics foundations, ultimately improving service delivery and reducing administrative costs.
The corporate plan outlines the ATO’s commitment to “strengthen [its] data and analytics foundations and capabilities” to improve data management, use, and sharing.
Metrics for measuring success
The ATO plans to measure the success of these initiatives through specific metrics, including the “proportion of pre-filled items accepted without change” and the “proportion of data items matched to client identifiers.”
These metrics reflect the ATO’s ongoing efforts to streamline taxpayer processes by pre-filling end-of-financial-year documentation from reliable sources such as employment and banking data.
Improving tax performance and reducing costs
Enhanced data and analytics capabilities are expected to play a crucial role in identifying the drivers of non-payment and refining strategies to encourage timely tax payments.
By leveraging improved analytics, the ATO aims to deliver better services, improve tax performance, and reduce administration costs.
Continuing existing programs
This strategic shift continues the ATO’s existing programs, particularly in data and analytics, cybersecurity, and digital services.
The focus on reducing outsourcing and enhancing internal capabilities underscores the ATO’s commitment to improving efficiency and effectiveness in its operations.
