Computer Weekly last week reported that Liverpool City Council could lose all tax records, benefit claims, rent bills and vital council documents in the event of a city centre electricity blackout lasting for more than 30 minutes.
Most local authorities have addressed disaster recovery issues but many would struggle in the event of a real incident, said Paul Skerman, consultant at Socitm Consulting, the consulting arm of local authority IT managers' organisation the Society of IT Management.
"Councils generally have [information outsourcing] contracts with disaster recovery suppliers, but the majority have never tested them," he said. "It is fine to have a deal with a supplier, but it does not end there."
Organisations need to consider the integrity of back-up datacentres and regular rehearsals, said Skerman. He said the lack of planning could be a result of the pressure local authorities are under to meet targets, such as getting all services online by 2005.
"There is simply too much going on, so local authority IT directors do not really get round to [looking at disaster recovery]," he said. "They also do not really understand issues such as information risk analysis."
Skerman called for a greater drive from central government to ensure councils are meeting guidelines such as the security standard BS7799.
When councils are signing IT outsourcing deals they should not assume that their technology partner has addressed issues such as disaster recovery, advised Mark Brett, programme manager at government agency London Connects.
"When outsourcing you must not be afraid to ask what you think are naive questions," he said. "There are a lot of complex issues around business continuity. "
According to a survey of 500 UK businesses by the Chartered Management Institute, 53% of respondents did not have a business continuity plan and, of the 47% that did, only 57% tested their plans annually or more frequently.
John Sharp, chief executive of the Business Continuity Institute, said, "We are very concerned that many UK firms continue to bury their heads in the sand. Business continuity management helps prevent and prepare for disruption, and can save firms and employees if disaster strikes. Without it, firms can suffer enormous, sometimes terminal, damage."