Elections technology can range from being relatively inexpensive to very expensive. As a result, financing technology can become a crucial part of the implementation process.
In the long-term, the use of technology is likely to reduce costs and increase the efficiency and productivity of electoral administration. In the short term, however, acquiring and implementing technology are likely to lead to significant cost increases. In particular, costs can increase substantially when new systems or hardware have to be developed and purchased and when a new system is introduced in tandem with an old one.
Securing the funds necessary to implement new technology or upgrade existing technology is an essential component of any technology implementation plan. Secure and ongoing finance must be acquired before technology acquisition can proceed beyond the planning stage.
There are several steps involved in securing the funds necessary for acquiring technology.
Affordability
Before committing to implement a new or upgraded technology, election management bodies (EMBs) must determine its affordability.
Indicative costing quotes of the proposed technology needs to be obtained to assess whether the estimated expenditure is realistic given the particular circumstances. Where several new technologies are being considered, it may be necessary to prioritise the available options and if necessary, discard those that are not affordable given the funding restraints.
How easily a quote can be obtained depends on the complexity of the technology. If the technology is a readily available off-the-shelf product, such as standard software or computer equipment, prices are usually easily obtained from local suppliers. Comparing quotes from a number of different suppliers—if possible, at least three suppliers—is a good practice.
Obtaining quotes for specialised or customised technology can be more difficult. There are a number of different strategies that can be used in this instance. For example, it may be possible to find other EMBs or organisations that use the same or a similar kind of technology to the one being considered. These other organisations may be willing to provide the cost of the systems they use.
Another method is to approach possible vendors and ask them to provide a quote based on a draft of the specifications for the proposed system. Care needs to be taken to ensure that the proposed system is described in sufficient detail to enable a quote to be relatively accurate.
A request for proposal (RFP) is a more formalised approach to seeking quotes and is not as binding as a tender process. This process involves issuing a set of specifications similar to, but not as detailed, as tender specifications and asking for cost proposals from suppliers that meet the project specifications. RFPs not only supply quotes for budgeting purposes but may also help refine the specifications for the technology being considered.
When determining whether a proposed technology is affordable, the cost of the technology over its whole life needs to be calculated. In most cases, this will include not only the purchase or lease cost but also maintenance costs, peripherals, consumables, software development, communications, upgrade costs and disposal costs.
Budgeting
After deciding that a particular technology is affordable, the next step is to prepare a detailed budget that takes account of both the immediate and the ongoing costs associated with the chosen technology.
There are four components to a technology budget: the list of goods and services to be purchased, the cost of each item, the schedule of payments, and any expected savings related to the new technology. Except in the case of items that are only to be used on one occasion and then disposed of, most items of technology will require ongoing funding for maintenance. Funds will also need to be secured for the life of the technology.
Funds acquisition
Once a detailed budget has been prepared, the next step is to acquire funds from the appropriate government or non-government source. The success of this process depends on preparing a strong business case with clearly identified benefits and a thorough budget.
Therefore a business case needs to justify the need for new technology to the funding authorities. If there are increased costs with the use of a new technology, the non-material benefits, such as increases in accuracy, speed and efficiency, need to be stressed. Other circumstances may be easier to justify, for example, when a less expensive technology replaces a costly manual process. However, it is important to ensure that all costs are properly factored in the budget.
It may be possible, in some situations, to use innovative funding mechanisms, such as joint ventures or leaseback arrangements provided there is no perception, justified or not, that the EMB is behaving unethically.
Once agreement has been obtained to provide funds, funding will need to be available in time for adequate development, testing and implementation of the new technology.
International funding
Depending on the circumstances, international funding may be available. This usually applies where external funding is an option, particularly where aid is being provided by other governments or by non-governmental organisations (NGOs). In these cases special issues may arise, such as foreign exchange issues, uncertainty of funding availability, or the potential for conflicts or impositions regarding, for example, the sourcing of suppliers.
Depreciation and amortization policies
When calculating budgets for the life of a project or a technology, depreciation and amortisation policies will impact on the calculations of costs and benefits, particularly in future years.
At the end of the life cycle of a technology item, the question arises as to whether it is more economical to use or dispose of obsolete equipment. As improvement in computer technology accelerates, this issue can emerge within a year or two of purchase. In cases where the technology continues to perform satisfactorily, notwithstanding that it is obsolete, it may be worth retaining. In other cases, it may be desirable to upgrade the technology and resell the old equipment while it retains some value.
The issue of when to upgrade obsolete equipment must be taken into account in a budget, since it will impact on the cost of the technology in the long-term.
