Business Focus is a weekly column providing at-a-glance
statistics and commentary on spending priorities and trends in
particular sectors. This week we look at local
government.
Among large local authorities, the per-desktop annual spending
on IT of £4,098 is substantially less than the wider UK business
average of £8,455.
And the lack of IT investment in smaller authorities is even
more marked, with an annual spend per desktop of just £1,125
against a small-business industry average of £3,132.
What is more striking is that this represents investment of less
than 14% of that made UK-wide by all larger firms.
Local government's relative under investment in IT, particularly
among small authorities, comes despite five years of relatively
generous budgets for IT as a result of Tony Blair's enthusiasm for
e-government.
It also stands in contrast to spending in central government,
where smaller departments invest more than the national average
spend on IT among small and medium-sized enterprises.
There is also relatively little investment among local
authorities on IT services, unlike central government, where about
60% of the per-desktop annual budget goes in this area, reflecting
government departments' reliance on major service providers such as
Fujitsu, Accenture, BT, Capgemini and CSC to deliver services.
Despite these investment levels, there is pressure on local
authorities to cut IT costs still further by sharing services over
the next five years.
The Transformational Government strategy, published by the
government last November, said, "There is significant scope for
rationalisation through sharing, particularly if central, local and
other public sector bodies can team up."
Ian Watmore, head of the Prime Minister's Delivery Unit, has
indicated a particular preference for larger-scale shared service
projects across local authorities.
Whitehall has also identified the types of project it believes
can be delivered as shared services, including back-office
functions such as finance, human resources and payroll, contact
centres, technical infrastructure, data sharing, information
management, information assurance and identity management.