Videoconferencing, cutting back on software and hardware licencing fees are among the ways Ottawa will try to slay the deficit

Federal budget: IT consolidation, telepresence for savings

The federal government will continue consolidating its IT and back office systems, make more use of videoconferencing and try to reduce the amount of software and hardware licencing fees its pays in its efforts to slash Ottawa’s spending over the next five years.

These are some of the nuggets found in the budget released Thursday by Finance Minister Jim Flaherty, which also said also said the Conservative government will spend $1 billion on support of science and technology, much of which will go to helping start up companies through supporting venture capital.

It also includes $40 million over two years to support CANARIE’s operation of Canada’s ultra-high speed research network.

The government plans to chop 12,000 full-time jobs plus eliminate another 7,000 through attrition. It doesn’t say how many of those are IT-related.

The budget has nothing to say about the long-promised national digital economy strategy, or mention that money is being set aside for rural broadband stimulus.

“It doesn’t have the same ‘outsource everything element’ to it,” that some were expecting, observed Alison Brooks, public sector research analyst at IDC Canada. But, she added, the merging of a number of IT departments into Shared Services Canada last August probably did more to trim certain departmental spending than the budget.

Shared Services Canada, one of the biggest IT centres in the government, has consolidated IT infrastructures of a number of departments. Its goal is to deliver email, data centre and network services to 43 federal organizations.

To make sure its staffers get the message, the budget says the government will introduce a bill stating Shared Services Canada’s job is to “deliver value for money for Canadian taxpayers.”

Looking at the measures to encourage employment growth nationally, Linda Leonard, senior vice-president of the Information Technology Association of Canada (ITAC), said the organization approves the budget’s thrust to create knowledge-based jobs. “There’s a really strong innovation flavour to this that our industry welcomes.”

She is also glad to see Ottawa is making permanent the Canadian Innovation Commercialization Program, which connects small and mid-sized innovative companies to federal departments.

However, she isn’t sure yet about the impact of changes to the Scientific Research and Experimental Development (SR&ED) tax incentive program. The tax credit rate will drop to 15 from 20 per cent and capital expenditures will no longer qualify.

The removal of capital expenditures may have an impact on large R&D spenders, she said, who support the government’s vision of a “more innovating nation.”

 ITAC represents IT hardware and software manufacturers, consultants and resellers.

The budget talks in general terms of how IT will play a role in saving Ottawa money without putting a dollar figure out. Here’s some examples:

–Public Works and Government Services “will modernize its information

technology infrastructure to reduce annual licensing, maintenance and

operating costs,” the budget says.

In addition, the department will shift from print to electronic publications and will increasingly adopt online service delivery.

–Spending at Industry Canada, which oversees federal telecommunications and broadcast policies and is playing a major role in the development of national digital strategy, will drop only slightly.

The department “has ensured that core activities related to government priorities, such as regulatory compliance and enforcement, grants and contributions that foster the knowledge-based economy, and support for key industries, are preserved,” the budget says.

“Industry Canada’s savings measures target reductions in administrative expenditures, office consolidations and more efficient research and analysis functions.

–The Commissioner of Official Languages “will contribute to the Government’s expenditure restraint efforts by reallocating operating savings towards necessary information technology investments.

–Health Canada and the Public Health Agency of Canada will adopt a shared services model, “eliminating duplication and overlap between their respective organizations through the consolidation of internal services and the standardization of policies and processes.”

–The government will change how the Canadian Food Inspection Agency

(CFIA) monitors and enforces non-health and non-safety food labelling regulations. The CFIA will introduce a Web-based label verification tool that encourages consumers to bring validated concerns directly to companies and associations for resolution, the budget says.

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