The Department of Home Affairs is set to sign a deal with one of two consortiums to develop a new visa processing system within weeks, where instead of the government paying an outright amount, the private provider will take a cut of every visa application fee charged.

It's expected the winning partner will spend $1 billion on the platform over 10 years, but be able to make hundreds of millions of dollars every year, through the application fees and other revenue options like advertising to applicants.

It's a price tag John Coyne, head of strategic policing and law enforcement at the Australian Strategic Policy Institute, says a government agency shouldn't pay, and would be very unlikely to get approved for in the first place.

Dr Coyne has told a Senate committee that public-private partnerships like the one proposed by Home Affairs are the way of the future for government agencies, as technological advances make it un-viable to make large financial outlays on software that becomes out of date more quickly than ever before.

"The current trajectory of technological developments continues to drastically reduce the life cycle of ICT investments-particularly when it comes to applications that rely on the underlying ICT infrastructure of servers, networks and storage," Dr Coyne wrote.

"So traditional public-sector approaches to technological innovation projects require greater capital expenditure, more often."

Dr Coyne said under current funding arrangements, it is difficult to get funding for modern IT approaches, where a client would pay continuing fees for continual updating of systems.

"In this context, closer public private partnerships in the visa system begins to make sense," he wrote, explaining that the plan reduced risks inherent in huge government IT projects for Home Affairs and shifted the risk of ongoing maintenance to the provider.

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Public service agencies needed to shift away from a 20^th century decision-making model when it comes to technological investment, Dr Coyne said.

"The model is broken. We need to find an alternative that deals with the current fiscal environment," he told The Canberra Times.

"If we don't accept that we have to change then we have to accept we'll have to spend increasingly larger amounts of money on these systems."

While the public-private partnership is the latest thinking on upgrading the technology, Dr Coyne argued continued public discourse and analysis was needed, and "transparency and accountability should be central tenets throughout the development of the new system".

Home Affairs' plan wouldn't take away the department's role in decision-making, Dr Coyne said, but would allow them to harness new technologies as they arise.

Dr Coyne said the plan wasn't the same as privatisation and it was important that "political point scoring" didn't get in the way of a 21^st century solution.

Labor and the unions have strongly opposed the plan, arguing it is privatising the visa system, will slash public servant jobs and expose the government to too much risk.

Shadow assistant treasurer Stephen Jones and shadow immigration minister Andrew Giles have written to the Australian Competition and Consumer Competition, voicing concerns a winning bidder would have a monopoly over a government service.

"Labor believes that the market power associated with the establishment of the private visa system and subsequent monopoly may have significant and detrimental anti-competitive impacts for both visa applicants and businesses providing services to visa applicants," they said in a statement last week.