Catalyst IT director Don Christie is accusing government of tilting the ICT industry in the wrong direction by undervaluing local development capacity and looking overseas too quickly for ICT resources.
Christie tackled government CIO Laurence Millar on the question during an address Millar gave to a joint Women in Technology/NZ Computer Society breakfast late last month.
Millar discussed how the State Services Commission, the new Government Technology Service, government agencies and the industry is meeting the needs of a government moving away from a "siloized" structure.
A number of major computer systems installed in the 1990s are close to the end of their life, he said.
"There is a number of billions of dollars that will have to be spent on replacement systems. I don't know that the funds exist to be able to do that replacement. I do know that the capacity doesn't exist in Wellington to be able to deliver the products and services that they're going to need."
"So what are you doing to build up that capacity in New Zealand?" Christie asked. "Or are you thinking you're going to shift more billions of dollars overseas?"
Millar cited incentives in education and the immigration of skilled staff.
Christie, however, says the government should be treating local suppliers differently from the way they are currently treated to keep and build local capacity.
"Is that not better than offshoring?" he asked.
"The long-term effect of [favourable treatment] is uncompetitive industries," Millar said. "It might take a generation or two but effectively you end up with government supporting inefficient businesses in order to maintain work here.
"We need to have a way in which we can use our smarts, our skills our experience to do work here in a way that is then resaleable offshore. If the policy position is clear that we should have equal competition, we should create environments that mean New Zealand firms can be successful on a level playing field rather than on a tilted one," he said.
However, Christie said he feels the government is starting with the assumption that capacity doesn't exist locally. He emphasizes that he is not asking for preferential treatment for local developers, simply fair treatment and adequate attention to what locals can offer.
The New Zealand computer industry is not getting that from government now, he maintains.
Late last week Chrisite amplified his position.
"Millar's blanket statement about whether we have the capacity militates against New Zealand," he says. "Not even he knows yet how much work there's going to be or how much capacity is in the country."
However a lot of what he said made sense, Christie concedes.
He suggests the small size of New Zealand's developer community makes for closer and more effective collaboration and agility.
"Where there's a large component of offshoring you tend to get bogged down in a long-winded and moribund project."
International companies can contribute to updating local skills, he says, but the competitiveness of the local industry should not be underestimated.
One way government ICT expenditure could be shaved, Millar said, is by an effort to influence multinational software companies to design features that governments need into the products and services.
"We've got some work going [on] between the UK, Australia and New Zealand about designing records and archive management into the early stages of the lifecycle of products from the major suppliers. So, the unique record-keeping requirements of government are baked into the product so when they get installed, it becomes part of the way you operate," he said.
The other side of this is persuading government agencies to share development effort on similar projects, such as border management. Both represent "a long journey", he said.
"Perhaps by about 2020, I'll be able to look back and say 'yes, that's where we wanted to be'."