IBM has signed a one year extension to its contract with Medicare for the provision of IT infrastructure services.

IBM secured the tender issued by Medicare and the Department of Health and Aging in 1999. The A$70 million ($47.2 million) deal announced Thursday will see IBM continue its provision of data warehouse, desktop, midrange, mainframe and call center support.

IBM said it has supported more than four million mainframe transactions and two million e-business transactions each day as thousands of pharmacies, GPs, health insurers, hospitals and individuals connect with Medicare for health-related transactions.

The company said it was keen to continue its relationship as a key partner to Medicare.

"As more and more Australians turn to the internet for provision of government services, IBM has a key role to play in providing Medicare with the robust, scaleable and secure technology it needs to deliver high quality government services to the Australian community," said IBM's public sector GM for Australia/NZ.

Last month employees at IBM's Baulkham Hills "Flightdeck" office threatened to go on strike unless IBM signed collective agreements including equitable pay rises, redundancy packages, penalty rates and leave entitlements.

The strikes had the potential to affect some of IBM's biggest customers, including Medicare, but negotiations avoided any action at the last minute.

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