Cost of GSN failure could fall with asset sales

Sale of GSN assets features in telco services tender

The State Services Commission could reduce the cost of the Government Shared Network (GSN) project failure through selling the network's assets to whoever provides its services in the future.

The SSC is now tendering for a provider to deliver the services formerly provided by the failed GSN. One of the options being canvassed in the tender is that the new provider optionally purchases assets used in the old network.

Tender documents published yesterday show SSC is seeking transition and implementation services, wide-area network services, internet services, secure wide-area network services, inter-agency connectivity, professional services and service management as part of its effort to replace the GSN.

As expected, the tender is a syndicated procurement from several agencies who signed up for the GSN. These include the State Services Commission, Ministry of Health, Ministry of Education, Department of Labour, Archives New Zealand, the National Library and the Department of Internal Affairs, all of whom will participate in using the GSN's replacement.

Other eligible agencies are the New Zealand Defence Force, the New Zealand Police, the New Zealand Security Intelligence Service, the Parliamentary Counsel Office, the Office of the Clerk of the House of Representatives, the Parliamentary Service and others.

The SSC established the $28 million GSN, a secure all-of-government telecommunications network, in 2005 and it has been operational since 2007. It currently connects agencies in about 130 locations around New Zealand.

However, not all services expected on the network have been delivered and the government decided to discontinue the GSN early this year. $10.6 million was written off the value of the project in the 2008 financial year. When discontinued, the GSN was losing $700,000 a month.

Two enquiring have since been held into the project, one by PricewaterhouseCoopers into the project failure and its causes and another into the probity of procurement for the project.

While no deliberate misconduct was found at either the SSC or lead consultancy Voco, New Zealand government CIO Laurence Millar resigned last week over mishandling aspects of the procurement.

The SSC says it is also proposing to sell the assets of the GSN.

“Each respondent has the opportunity, but is not required, to offer to purchase some or all of the assets as part of its proposal. Proposals that include an offer to purchase some or all of the assets will be assessed together with proposals that do not include such an offer,” the tender says.

Contracts with the provider are expected to be signed with the Department of Internal Affairs, rather than SSC as the functions and control of the GSN will move to DIA's new Government Technology Services division mid-year.

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