Results: Value for money - Part 1

ICT expenditure

Total ICT expenditure (operating plus capital) for the entire survey population of 163 organisations was $1.94 billion (Table 1). Imputed responses made up 6.2 percent ($0.12 billion) of this total.

Table 1

Government ICT expenditure by organisation size and type for the 163 organisations in the population (30 June 2008)

The 'Central government' subpopulation in this survey is likely to be close to the combined 'Central government' plus 'Crown research institute' subpopulations from the Statistics New Zealand Government Use of ICT Survey 2006, so it is possible to perform a limited comparison of expenditure for this population across the two periods, acknowledging that there remain residual differences in population and in imputation methodologies that will limit interpretation (see Technical Notes section).

Table 2 indicates that total Central government ICT expenditure in the year to 20 June 2008 may have increased 12 percent since 2006 (from $1.31 billion to $1.47 billion) and respectively lower and higher proportions have been allocated to capital and operating expenditure.

Table 2

Government ICT expenditure: comparison of populations in common between Government Use of ICT Survey 2008 and Statistics New Zealand's Government Use of ICT Survey 2006. Note that residual differences in population and imputation methodologies remain and will limit interpretation.

CIOs were asked to estimate how much of their organisation's total ICT expenditure was on running the business versus transforming it. While a major point of ICT investment is to improve overall business performance, a typical Gartner Research⁵ benchmark from the private sector is that typically about two-thirds of IT spending is on keeping a business running and only around a third is on transforming it.

The survey responses were estimates and not based on actual spending so may be somewhat subjective. There was a wide variation in responses, from 20 percent of expenditure on running the business in some organisations to 100 percent in others (Table 3). However, overall the responses suggest that New Zealand State sector organisations typically perceive a relatively high proportion of their ICT expenditure is on keeping the business going compared to transforming it. The median (middle) response was 79 percent of expenditure on running the business (versus 21 percent on transforming it).

Figure 1

Proportion of total ICT expenditure on running the business (30 June 2008)

Table 3

Proportion of total ICT expenditure on running the business (30 June 2008)

Note: Due to rounding, percentages may not add to 100

Footnotes

[⁴ Number of employees is an estimate derived from a variety of sources including annual reports, the State Services Commission's Human Resource Capability Survey, organisation websites, and the number of reported ICT users. ]

[⁵ Realising the Benefits of Project and Portfolio Management, Light, M., Rosser B., and Hayward, S. 2005. Gartner Research report G00125673. ]

[⁶ Percent is of the 101 organisations that responded to this question ]