Tomorrow's Budget could be the most technologly-focused
yet, with the government's recent interest in the IT sector's
economic importance leading to cautious optimism that technology
will come out of it well.
But there is an acceptance that contracts will be renegotiated
in tighter conditions, and that some cost savings may have to come
through IT as the government aims for £15bn of efficiency
savings.
Richard Baron, head of taxation at the Institute of Directors,
says, "We would like to see a commitment to getting the public
finances back into balance. Some parts of the IT industry make a
good living from public sector contracts, and getting the economy
back into balance will mean negotiating these contracts will be
tougher."
Despite this, the IT sector is hoping government policy will
back up the recent rhetoric, with Gordon Brown speaking out about
the
importance of the UK's technology sector in bringing the
country out of the recession.
And although there is likely to be some pain for parts of the
sector, industry experts are emphasising the importance of
technology in helping to move the economy on.
William Higham, head of public affairs at IT trade association
Intellect, says, "It looks at though the government is ambitious to
make this the budget for technology.
"The government has recognised the technology industry as a
source of future growth and jobs for the UK economy. But there is
fierce international competition to attract international
technology investment, so everything lies in the detail."
The public sector may be forced to cut costs through IT and
back-office systems in the same way as the private sector, and
organisations may look for savings as contracts come up for
renewal.
But the important thing to remember, Higham says, is that
technology's real power lies in cutting the wider operational costs
of government.
Also important, Higham says, will be the government's support of
IT skills. "The technology sector is one of the few sectors in the
UK economy that is, in parts,
still hiring in volume. If the government has set its course
towards an economy with a stronger technology base, it is vital
that it plans ahead to produce the core skills to fill future
vacancies, and ensure the public have sufficient literacy to make
the most of it."
Denise Plumpton, director of information at the Highways Agency,
says she expects to see pressures on all areas of public spending,
along with more scrutiny over new project investments and a move
towards a smaller, tighter scope for projects.
She emphasises the importance of seeing IT as a way to increase
efficiency and put Britain in a good position to move on quickly
from the recession.
"I think that in the current climate, good investments in
technology and applications can help all organisations, both in the
public and private sectors, gain efficiencies and deliver market
competitiveness.
"I really hope that there is continued investment in research
into new and emerging technologies so that as we come out of the
recession, the UK and its organisations are best placed to steal a
march on others."