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Why FinOps is Essential for Australian Government Agencies' Cloud Transformation

Australian government agencies are moving to the cloud at full speed, driven by the need for better service delivery, scalability and digital transformation.  With initiatives like the Secure Cloud Strategy, the Cloud Computing Policy and the new APS ERP approach, cloud-based services are being embraced with gusto across the public service.
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Finance
22 February 2025
Liesel Meinecke - Synergy Digital Partner
5 minutes

Australian Government agencies are moving to the cloud at full speed, driven by the need for better service delivery, scalability and digital transformation.  With initiatives like the Secure Cloud Strategy, the Cloud Computing Policy and the new APS ERP approach, cloud-based services are being embraced with gusto across the public service. 

But here’s the catch:  more cloud usage equals more complexity in managing costs. Without clear visibility and financial governance, agencies risk budget blowouts, inefficiencies, and compliance headaches.  As agencies accelerate cloud adoption, managing cloud spend is becoming as important as reaping the benefits of scalability and flexibility. 

The DTA (Digital Transformation Agency) is taking this seriously, recently adding Cloud Financial Optimisation (Cloud FinOps) to its Architectural Framework. This move signals the growing recognition that managing cloud costs is just as critical as adopting the cloud itself. 

 

What is FinOps? 

FinOps is a financial management framework that helps organisations track, optimise, and manage cloud costs in real time.  It brings together finance, IT, and operations to ensure that every cloud dollar is accounted for, optimised, and strategically invested.  Its six core six core FinOps principles include: 

  1. Break Down Silos - Cloud cost management is a team sport—IT, Finance, and business must collaborate for smarter spending. 

  1. Focus on Value, Not Just Cost - Saving money is great, but spending wisely to drive business outcomes is even better. 

  1. Everyone Owns Cloud Costs - Teams that use the cloud should understand and optimise their own spending.  

  1. Real-Time Data equals Real Savings - Live cost insights enable faster, better decisions. 

  1. FinOps Teams Guide, Not Control - A central FinOps function empowers teams with best practices while keeping agility intact. 

  1. Use the Cloud’s Flexibility - Pay-as-you-go is powerful—if you leverage reserved instances, autoscaling, and discounts wisely. 

 

Why FinOps is Critical for Government Agencies 

For the public sector, transparency and accountability aren’t just better practice – they are essential.  As cloud adoption grows, agencies face increasing challenges such as unpredictable billing, inefficient resource allocation and limited cost visibility.  Without an appropriate FinOps strategy, agencies risk: 

  • Uncontrolled Cloud Costs: Paying for unused or underutilised resources 

  • Outdated financial controls:  Moving from a predictable, capital-based model to one which is consumption based and changes in real time, renders many traditional controls ineffective. 

  • Policy misalignment: Falling short of whole of government frameworks like the Digital and ICT Investment Framework and the Australian Government Architecture which specifically call out the need to “monitor the health and usage of [cloud] services in real time”. 

 

Cloud adoption is growing – so too is the need for FinOps 

As more agencies embrace multi-cloud and hybrid environments, managing cloud costs efficiently becomes non-negotiable. Without proper cost governance, the benefits of cloud transformation can be lost to inefficiencies and budget overruns. 

By embedding FinOps into their cloud strategy, and building the necessary capability to support it, agencies can: 

  • Optimise cloud spend without compromising service delivery 

  • Improve forecasting to align with annual budget cycles and optimise pricing choices 

  • Meet compliance requirements while staying agile 

  • Enhance financial reporting for greater transparency and better decision making. 

 

The Future of FinOps in Australian Government 

FinOps is no longer a "nice to have" - it’s becoming a standard practice for agencies looking to maximise the value from every IT dollar they invest and ensure financial sustainability. The real question isn’t whether agencies need FinOps—it’s how quickly they can implement it to future-proof their cloud investments.

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