Your tax dollars at work: demonstrating accountability through cost transparency

How public sector organisations can maximise the transparency of their growing cloud and IT spend.

The federal election will put government spending under a microscope. In the midst of this, the Australian public is continuing to demand better, faster and more seamless digital experiences, which is putting pressure on public sector departments to invest in digital transformation initiatives — and quickly.

The Australian Government set out an ambitious plan to significantly transform public services over the next decade with the launch of its Data and Digital Government Strategy in December 2024. This has triggered a surge in IT investments across various departments.

In 2025, cloud investments in Australia are projected to soar to $26.5 billion as governments continue to make significant bets on technology. However, the rush to modernise could create significant challenges, including a lack of visibility into spend, regulatory or compliance hurdles and the risk of duplicated efforts or wasteful expenditures. As the government accelerates its digital transformation, it must navigate these complexities with as much transparency as possible to maintain citizens’ trust in how their tax dollars are spent.

Why transparency is a challenge for the public sector

In 2022, the Digital Transformation Agency (DTA) published a report revealing that the majority of Australia’s top 20 federal government agencies — responsible for over 80% of all government expenditures — struggle to allocate cloud costs and fund experimental or ‘iterative’ projects. It highlighted that outdated funding models, together with insufficient funding beyond business-as-usual operating costs, were significantly hindering the government’s digital transformation.

In an era of fiscal constraint, the pressure to optimise IT budgets and demonstrate cost transparency is becoming more urgent.

Over the past few years, the Australian Government has taken steps to enhance transparency, and initiatives like the Secure Cloud Strategy and the Australian Public Service Enterprise Resource Planning approach underscore this commitment.

The government also established a Cloud FinOps Standard in September 2024 as part of its digital architecture, emphasising the importance of implementing FinOps practices across Commonwealth entities.

Essentially, FinOps is a cloud financial management discipline and cultural practice that maximises the value of cloud computing for organisations. FinOps fosters collaboration between finance, engineering and business teams to make data-driven decisions about cloud investments and address unique challenges such as compliance requirements, long-term planning and stakeholder engagement. By adopting FinOps practices, government agencies can optimise cloud spending, improve financial visibility and align cloud investments with their mission outcomes — ultimately improving service delivery for citizens while adhering to regulatory compliance requirements and fiscal responsibilities.

Overcoming the public sector’s challenges

However, the public sector faces some unique barriers to implementing FinOps practices strategically and consistently.

First, there is a challenge around internal understanding and buy-in. In fact, 53% of Chief Data Officers in Australia’s public sector admit that their data strategy is not widely understood within their organisations. The public sector also stores, manages and protects a vast amount of sensitive data, which results in access restrictions to billing information.

The complexity of the organisational structures, resource constraints and complicated ROI metrics can also disincentivise departments from implementing new processes.

To overcome these challenges, government agencies should focus on education, secure data access methods and simplified ROI metrics. By fostering a culture of collaboration between IT, finance and operations teams, agencies can achieve greater financial transparency and cost optimisation.

IT and cloud spending visibility will pave the way for innovation

The reality is that the public sector needs to continuously plan and adjust its IT and cloud budget.

This ongoing planning is crucial for ensuring long-term stability, sustainability and continuity of essential services. Government agencies must balance immediate needs with future obligations, often spanning multiple budget cycles or political terms.

The Australian Government has demonstrated a strong commitment to advancing AI and quantum technologies, as evidenced by its National Quantum Strategy and significant investments in the sector. By leveraging FinOps principles, Australia could optimise its cloud investments and resource allocation, potentially accelerating its path to becoming a global leader in technological innovation.

FinOps could also help mitigate risks associated with investing in AI and quantum computing projects by preventing failures due to overspending by maintaining fiscal responsibility and maximising public value.

We live in an era where public sector accountability is more crucial than ever before. By prioritising transparency around IT spend, the public sector can create a foundation for greater trust, efficiency and innovation in government operations, ultimately benefiting citizens and positioning Australia as a leader in responsible and effective technology adoption.

*Pete Wilson is Vice President for Apptio Business and General Manager for APAC at Apptio, an IBM Company. With over 25 years of experience in information technology, financial services, engineering, software development, and the airline industry, he has built a solid reputation for successfully designing and executing large-scale, complex business and technology transformation programs within major global organisations.

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