Does outsourced IT offer good value?
Re Taxpayers get $26.9M bill for axed eHealth contract, June 19 If that eHealth project was done in-house (assuming there was an IT team), the cost of failure would be much lower than the $26.9million tab charged by the private IT consulting firm.
Time and time again, we read of the government having to pay huge sums to consulting companies for failed (including substandard) IT systems, e.g. welfare, eHealth, billing systems. If you add up the tabs for all the payments to these IT companies, it would run into the hundreds of millions.
Is the government getting the best value for its buck by engaging IT companies to do these projects or would it be better off building a core team internally to undertake these projects?
Since the Harris Progressive Conservative government, the trend has been to rely more on private business to provide IT services and to reduce head count. The problem with that approach is that the government, over time, becomes more reliant on business and the expense on IT contracting keeps escalating.
It can be argued that it is cheaper for the government, in the long run, to have its own IT team to do the work; the immediate savings is the profit margin that IT consulting companies charge and the long-term benefit is that the knowledge expertise is in-house, thus a private IT firm would not be needed for support and maintenance.
The government could even turn the IT department into a profit centre, using it to provide services to other provincial governments.
The Ontario auditor-general could do an audit to show whether our government is penny-wise and pound-foolish in its outsourcing approach of IT services. Salmon Lee, Mississauga With another $26.9 million down the drain, like Medusa, when will our provincial government stop turning bad policy into stone?
The taxpayers of Ontario are struggling with an accumulated deficit of more than $300 billion, much of it spent over the last 10 years, and we just can’t afford any more mistakes. Brian Weller, Markham