Labour's ICT spokeswoman Clare Curran says yesterday's decision to scrap the Government Shared Network (GSN) is a "backward step".
Curran and State Services spokesperson Grant Robertson say the GSN is a major piece of the information communication technology infrastructure developed by the previous Labour government.
“The National government’s heavy-handed and regressive approach to new technology reflects its lack of a plan for ICT and will damage the industry generally," they said in a statement released today.
“This decision demonstrates a big step backwards for New Zealand’s digital strategy at a time when we need to be showing certainty and confidence.
"Instead of laying out a positive broadband plan, National is asleep at the wheel — since being in government, its only move has been to cancel a major IT infrastructure project, while leaving 36 Broadband Investment Fund projects in limbo."
Yestersday, State Services Minister Tony Ryall pronounced the network "financially unsustainable".
"This government has taken the earliest practical opportunity to begin shutting it down. It is not prepared to continue to underwrite significant losses under any economic climate," Ryall said. "All public service agencies need to demonstrate fiscal responsibility and focus on high value and high performance programmes."
Given that, the GSN cancellation appears to raise questions about the future of the KAREN research network, which has gone to government for additional funding after it too failed to meet financial expectations.
In December, briefings prepared for incoming science and technology minister Wayne Mapp said Research and Education Advanced Network New Zealand (REANNZ), which operates the KAREN network, had failed to meet financial expectations and was now seeking further funding.
"These expectations have been found to be unrealistic and the company is requesting a [withheld under the OIA sections 9(2)(b)(ii), 9(2)(i) and 9(2)(j)] equity injection to ensure its long-term viability, at least until 2015," the briefing notes said.
REANNZ's international connectivity contracts are due for renewal in September 2009, the briefing said.
"Although REANNZ may have sufficient cash to renew the international network (or extend current arrangements for a year), it forecasts that it will not have sufficient cash to renew the national network contracts that expire in 2010. Therefore, the REANNZ Board is requesting certainty in the form of a future capital injection from the Crown by February 2009 when it needs to go to market to renew or replace its international arrangements ..."
REAANZ chief executive Donald Clark says his organisation had always been supportive of what GSN was trying to achieve but that REAANZ is much more about procurement and design.
“We don’t build services,” he told Computerworld today.
REAANZ is a Crown-owned company under the Companies Act. As at January this year, the KAREN network had 54 members and partners connected at 91 locations across New Zealand. Total traffic volume was 830TB for the month. It is also managing the tender process for a new trans-Tasman cable.
“REAANZ is progressing the work on the trans-Tasman cable initiative, to which $15 million of capital has been allocated,” Clark says. “We will be reporting soon to ministers on the outcome of the first stage in the process.”
State Services will manage the exit strategy from the Government Shared Network (GSN). Cabinet has agreed that the SSC will have till the end of December to complete the withdrawal.
However, in an email to companies providing GSN services, transition manager Brent Chalmers says some key features and principles of the network will be preserved. That fits with a recent user-group briefing where it was suggested that syndicated procurement was a likely way forward.
“It very much sounds like they will go to tender,” says a source, who did not want to be named. “Syndicated procurement doesn’t work because all the users want some uniqueness. It’s just a gold mine for consultants.”
The GSN was designed as a dedicated secure network for communication within and among government agencies but there was never sufficient take-up to make it economically viable. It has been losing $700,000 a month since it became operational in September 2007.
To add to the network's woes, two enquiring are now under way into its operations: one is into the network itself; the other into the cost and value of services provided by consultancy Voco in architecting the network.