In the wake of the Novopay debacle, ICT supplier are facing "horrific" contracts with government agencies, says NZRise co chair Don Christie.
"They're loading up the liability on the suppliers," he says.
NZRise was formed to represent the interests of New Zealand-owned IT companies.
There's a certain irony about the situation. Prime Minister John Key told a recent ICT gathering in Wellington that there was a need not to become IT averse in the wake of Novopay.
Christie says it's different on the ground. Government agencies are increasingly risk averse and they're handing over responsibility, saying they'll let the Office of the Government CIO sort things out.
AMS provides payroll services to 25 per cent of the public service, and 50 per cent of the government health organisations. CEO Noel Reid says: "We're seeing what we call the 'Novopay effect'. Everyone is sitting on their hands; no one is prepared to change. It's definitely a concern."
There's a broader issue. With cutbacks in government jobs and the likelihood that more will go in the government ICT sector, decisions aren't being made.
The CEO of a vendor which deals largely with government [he didn't want to be named because of that] told Computerworld New Zealand he estimates 80 per cent of employees are protecting their jobs, either by not making decisions they can be held responsible for or by choosing multi-national vendors to the exclusion of the smaller local market.
"It used to be said you'd never get fired if you bought IBM. That changed in the late '90s but it's gone back to that now -- IBM, Oracle, SAP -- all the big boys."
Christie says it looks as if a bit of that is happening.