Mr MARTYN EVANS (2:59 PM) —My question is to the Minister for Finance and Administration. Minister, has the Auditor-General described the IT outsourcing program for which you are responsible as substantially behind schedule, procedurally flawed and almost three times over its management budget? Does the report also show that your projected savings have not been realised and that tenderers have overstated the savings on offer? Will you now withdraw your proposal to force this counterproductive program on the science agencies such as CSIRO and let their essential research work proceed without the burden of your ideologically driven IT outsourcing program?

Mr FAHEY (Minister for Finance and Administration) —I thank the honourable member for his question. I can indicate that the government acknowledges the Auditor-General's report in respect of the initial contracts on information technology outsourcing. There has been a rigorous analysis of the process to date. I can indicate quite clearly that rigorous audit has demonstrated that the program is fundamentally sound, that it has been conducted to the highest standards of probity and integrity and that the government is satisfied that the IT initiative's stated objectives are being achieved.

I inform the House that those stated objectives are, firstly, to provide savings to the Australian taxpayers in the hundreds of millions of dollars. To date—the program is about 40 per cent along the road—those savings are around $365 million. Another stated objective is to allow Commonwealth agencies to take a strategic approach to the provision of information technology and to ensure that all those arrangements represent value for money for taxpayers. That objective is being met. Another stated objective is that there should be benefits that will flow to Australian small and medium enterprises and the Australian IT&T industry. I can indicate that to date there is some $90 million worth of new strategic investment. There has been some $900 million worth of products and services sourced in Australia. There are around $290 million in new exports and import replacement activities. There is around $400 million worth of work for Australian SMEs and there has been the creation of some 400 jobs in regional Australia.

I noted this morning that the Leader of the Opposition was out there and he started throwing the old words around with gay abandon, as is quite frequent at his early morning doorstops. He spoke about `grand incompetence'. Well, I would like to think that I can get the tag of `grand incompetence' when compared to some of the things that the finance minister in the former Labor government did. I wonder what that might be described as?

We talk about $365 million worth of savings for the Australian taxpayers and the former finance minister uses those words. This is the man who, only six weeks before the 1996 election, was asked, `Have you got any plans to increase taxes?' His answer was, `Why would we? We're operating in surplus and our projections are for surpluses for the future.' Well, we soon found out what he understood `surpluses' to mean—$10.3 billion of deficit was what surpluses meant to the Leader of the Opposition, the former finance minister. If we have a look at the Collins class submarine, $5.1 million was spent and still the meter is ticking over. If $365 million worth of savings in IT outsourcing to date is described as grand incompetence, all I can say is that the fiscal management of the former finance minister can only be described as grand larceny.