The heads of Government IT, John Suffolk and Nigel Smith, are working with Government CIOs and senior responsible owners of major projects on “validation reviews” to assess whether savings on 80 large IT and non-IT projects, which cost £50m or more, can be made.
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The reviews will also assess the impact of making the savings and how much the cuts will effect the overall feasibility of projects.
The aim of the reviews is to lead to cuts that will contribute to the £6bn of savings promised by the new government in this financial year.
The results of the reviews will be reflected in tomorrow’s Budget.
Government CIOs have also been asked to give their initial views to the Treasury – in time for tomorrow’s Budget – on what cuts can feasibly be made.
In addition, CIOs and senior responsible owners – who are the business owners of projects, and who can be held responsible by Parliament for their failure – are working on a more extensive Assessment Review of Projects which lasts until 31 July 2010.
More IT project savings being sought for 2011/12
These reviews will investgate the level savings that can be made beyond the current financial year of 2010/11. The reviews will assess between 30 and 40 significant projects and will inform the Spending Review which is planned for this Autumn.
The unambiguous wording of internal communications between the Cabinet Office, Office of Government Commerce, permanent secretaries and other top officials, on the need for cuts on IT-related projects, indicates the unified sense of purpose among Government CIO John Suffolk, the Chief Executive of the Office of Government Commerce Nigel Smith and Government CIOs.
The background to the reviews is a freeze on all contracts and projects where ICT is a key element to deliver the service or outcome.
What the freeze covers
The freeze covers all new projects above £1m in value including:
– All new contracts
– Feasibility studies
– Pilot projects
– Proof of Concept projects
– Contract amendments and extensions
What the freeze doesn’t cover
– ICT spend as a result of Budget tax measures
– Military projects provided by specialist defence contractors. General ICT suppliers, which are providing civilian or administrative services to the MoD, are included in the moratorium.
– Contracts changed as a result of the Government’s renegotiation of contracts with major suppliers. The Cabinet Office says that projects won’t fall within the scope of the freeze simply by virtue of contracts being renegotiated.
– Protected departments which are thought to include the security services. Any savings they make can be kept in the department.
– Where the freeze might go against the plans to make savings, put at risk an IT-led organisation or front citizen/business services.
When exemptions from the freeze may apply
Departments and agencies can apply for an exemption from the freeze when:
– The new project, or spend, or contract needs approval because otherwise there would be loss to the public purse of a delay
– A delay would affect directly or stop the delivery of a current citizen/business-facing service that’s consistent with Government priorities
– The project or programme delivers a mandated legislative requirement and where the end date cannot change, and a delay would put the end date at risk.
– An SME ICT supplier may be at risk of collapse because of a delay in signing a contract and the contract represents value for money.
The Cabinet Office and the OGC have reminded departments and agencies that the £6bn cuts planned for this year provide an outstanding opportunity to review change agendas, remove overlap and duplication, and cut out unwanted projects or elements of projects.
Government pays 40% over market rates on outsourcing contracts – IT Projects Blog