Government could save £7bn a year on IT, ex-Logica chief reports

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Government could save £7bn a year on IT, ex-Logica chief reports

Rebecca Thomson

The government could reduce its IT spending by £7bn a year if it accepts the recommendations of a new report.

Martin Read, a former Logica chief executive, said today that the government should introduce better governance of IT-enabled change programmes to achieve £4bn of savings a year on back-office operations. His report also calls on the government to make £3.2bn of savings a year on IT spending.

There needs to be better management of information, benchmarking and reviewing of costs, as well as better governance of IT programmes, said Read.

His main recommendations were:

• Standardising common IT-enabled business processes, such as financial reporting

• Improving the success rate of government IT projects. Read recommends doing this by ensuring project objectives are better defined; improving the auditing and review process; improving leadership

• Improving IT hardware, software and services procurement

• Driving up supplier performance using the Common Assessment Framework

• Extending the use of benchmarking.

Read is one of five independent advisors who between them have identified scope for £15bn in efficiency savings in government. The government is expected to respond to the recommendations, published in the Operational Efficiency Programme (OEP), in tomorrow's budget.

Around £6bn of the identified £15bn savings are expected to be realised in the current spending review period. The rest will be delivered by the end of the next spending period.

In addition to IT, money will be saved through better collaborative procurement, asset management, and property sales.

The target for the current spending review was overall efficiency savings of £30bn. The government has increased this to £35bn of savings by 2010-11 following the publication of the OEP.

In the foreword to their report, the five advisors say, "The private sector never stops seeking greater efficiency in the ways that it purchases and provides services, and neither should government. There is scope to go further and increase the value for money the public sector achieves from both its activities and from some of its most valuable assets."

Government has already achieved £26.5bn of efficiency savings under the Gershon Efficiency Programme - beating its target of £21.5bn.


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