The demand for digital services from governments is increasing as citizens expect more convenience and accessibility from online platforms. However, many government agencies are struggling to keep up with the pace of innovation due to their reliance on old and unsupported IT systems, also known as legacy ‘tech debt’.
What is legacy ‘tech debt’ and why is it a problem?
Legacy ‘tech debt’ refers to the ongoing maintenance and operational costs of outdated IT systems that are no longer fit for purpose or compatible with modern technologies. These systems often have security vulnerabilities, performance issues, and limited functionality, making them a burden for both the government and the users.
According to the Australian Information Industry Association (AIIA), the peak body for the digital industry, legacy ‘tech debt’ is a looming crisis for governments that many do not comprehend or understand. The AIIA’s chief executive Simon Bush said that legacy ‘tech debt’ is strangling government digital budgets and preventing them from delivering seamless services to citizens.
He cited a report by McKinsey that estimated that around 40 per cent of tech budgets go to maintaining legacy systems, a number that is increasing. He suggested that for the Australian government, the cost to maintain would be even higher due to ongoing underinvestment over decades.
What are some examples of legacy ‘tech debt’ in government agencies?
One of the most notorious examples of legacy ‘tech debt’ in the Australian government is the welfare payment system run by the Department of Human Services (DHS). The system is based on 40-year-old code on a Model 204 database that is heavily customised and difficult to modify.
The DHS tried to replace and update this system in 2015 with a modernisation program that was expected to cost $1.5 billion and take seven years. However, the program faced multiple delays, cost overruns, and technical challenges, and was eventually cancelled in 2021. The DHS wrote off $1.2 billion from the project and decided to continue using the old system until further notice.
There are many other examples of legacy ‘tech debt’ across almost every large and small federal agency, such as the Australian Taxation Office (ATO), the Department of Defence, the Department of Home Affairs, and the Department of Health. These agencies have been relying on outdated systems for decades, some of which date back to the 1970s and 1980s.
What are the consequences of legacy ‘tech debt’ for government digital services?
The consequences of legacy ‘tech debt’ for government digital services are manifold and serious. Some of the potential impacts include:
- Reduced efficiency and effectiveness: Legacy systems often have slow processing times, frequent errors, and limited integration capabilities, resulting in lower productivity and quality of service delivery.
- Increased security risks: Legacy systems often have weak or outdated security measures, making them vulnerable to cyberattacks, data breaches, and fraud.
- Decreased user satisfaction: Legacy systems often have poor user interfaces, complex navigation, and limited functionality, making them frustrating and inconvenient for users.
- Lost opportunities: Legacy systems often prevent governments from adopting new technologies, such as cloud computing, artificial intelligence, blockchain, and biometrics, that could enhance their digital capabilities and offer new benefits to users.
What are some solutions to address legacy ‘tech debt’ in government agencies?
The solutions to address legacy ‘tech debt’ in government agencies are not easy or cheap. They require long-term planning, strategic investment, and collaborative partnerships between the public and private sectors.
Some of the possible solutions include:
- Modernising existing systems: This involves upgrading or replacing legacy systems with newer technologies that are more secure, reliable, scalable, and interoperable. This can be done incrementally or comprehensively depending on the complexity and urgency of the situation.
- Migrating to cloud platforms: This involves moving data and applications from on-premise servers to cloud-based services that offer more flexibility, efficiency, innovation, and cost savings. This can be done partially or fully depending on the feasibility and suitability of the option.
- Developing new systems: This involves designing and building new systems from scratch that meet the current and future needs of users. This can be done in-house or outsourced depending on the availability and expertise of resources.
What are some examples of successful government digital initiatives?
Despite the challenges posed by legacy ‘tech debt’, there are also some examples of successful government digital initiatives that demonstrate the potential benefits of modernising IT systems.
One of them is the Single Touch Payroll (STP) system implemented by the ATO in 2018. The STP system allows employers to report payroll information such as salaries, wages, tax withholdings, and superannuation contributions directly to the ATO through their software or service provider. The STP system has improved compliance, accuracy, transparency, and efficiency for both employers and employees.
Another example is the COVIDSafe app launched by the Department of Health in 2020. The COVIDSafe app is a digital contact tracing tool that uses Bluetooth technology to record the close contacts of users who have tested positive for COVID-19. The COVIDSafe app has helped health authorities to quickly identify and notify people who may have been exposed to the virus and prevent further spread.
