Australia's Digital Transformation Agency Issues New Policy to Accelerate Government Cloud Adoption
December 11, 2025
Australia's Digital Transformation Agency (DTA) has released a new policy aimed at accelerating the federal government's migration to cloud computing, a move seen as critical for modernizing public services and enabling the adoption of artificial intelligence. The policy underscores a global trend where governments are seeking the agility, scalability, and innovation potential of cloud infrastructure to replace legacy systems.
The DTA's updated "Cloud Policy" explicitly encourages all government agencies to prioritize cloud-based solutions for new digital initiatives and for moving away from older, on-premises systems. While not mandating a complete shift away from owned hardware, the framework states that agencies should "consider cloud for new digital initiatives, prioritise moving off legacy systems and transition to cloud where it makes sense to do so, and consider hybrid or multi-cloud models when pure cloud solutions are not justified." The policy is scheduled to take effect from July 1, 2026, though it excludes agencies within the national intelligence community.
Lucy Poole, Deputy CEO of the DTA, emphasized that the guidelines are designed to provide clarity and confidence. “With clear requirements in place, agencies can make more consistent and confident cloud decisions,” she said. “This will lift the security, performance, and long-term sustainability of the systems that underpin essential services accessed daily by Australians.” The policy also mandates that agencies design for interoperability and cost management practices like FinOps to avoid vendor lock-in and control expenditures.
This push builds upon existing, significant cloud investments within the Australian government. Notably, the Department of Defence has engaged in major contracts, including a five-year deal with Microsoft worth AU$495 million (approximately US$324.71 million) and a separate, long-term partnership with Amazon Web Services. The AWS agreement, initiated in July 2024, involves a joint investment of AU$2 billion (US$1.3 billion) over a decade to develop a high-security data center and cloud system. Other departments, such as Foreign Affairs and Trade, have also begun their cloud migration journeys.
The implications of this centralized policy are far-reaching for Australia's public sector IT landscape. By creating a more standardized and proactive approach to cloud adoption, the DTA aims to reduce fragmentation, enhance cybersecurity posture, and create a foundational technology environment that can more readily support emerging tools like AI. The shift is expected to drive further demand for cloud services from major providers within the Australian market, while setting a benchmark for digital transformation in government internationally.
Source: datacenterdynamics
Australia's Digital Transformation Agency Issues New Policy to Accelerate Government Cloud Adoption
