Government raises threshold for central approval of IT projects to £5m

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Government raises threshold for central approval of IT projects to £5m

Kathleen Hall

The government has raised the threshold for ICT projects requiring central approval to £5m, from the £1m level imposed in May. The new controls will be in place until 2015.

A spokeswoman from the Cabinet Office says the move is a "sustainable measure" for the government. "As part of the negotiations with the Cabinet Office and Treasury the government has brought in measures that it can work with in the long term. The initial limit was a ‘short, sharp shock’ until a move to something more sustainable," she said.

The government says the new threshold will ensure that ICT solutions bought have a common infrastructure and open standards, allowing them to be used across public bodies. The rule means that any contracts above £5m will need to be signed off by the Cabinet Office.

There are no figures available for ICT savings as a result of the cost-controls implemented in May 2010, but total government savings are expected to reach £3bn by the end of the financial year. Of this, £800m is estimated to have come from contract renegotiations with key suppliers.

Cabinet Office minister Francis Maude said: "What we have shown today is that if you are prepared to really look, billions can be saved from overheads and unnecessary costs at the centre of the government – without touching front-line services. I really hope that when people look at the numbers they too will want to replicate this kind of approach elsewhere in the public sector."

However, the government is yet to impose a maximum limit for IT contracts. A recent report from the National Audit Office revealed that the government’s commitment to set a £100m cap on IT contracts may not be implemented.


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