Spending review: What will public sector IT look like in five years?

So now we know. It will take time for the full ramifications of the government’s spending review to flush through the system, but there is little doubt that the budget cuts announced by Chancellor George Osborne yesterday herald a turning point in public sector IT.

Underpinning the cuts is a realisation that technology can help not just by reducing the cost of IT contracts but by transforming public service delivery. IT was highlighted as one of the key factors that will help HM Revenue & Customs cut 15% from its budget; greater use of digital application forms will help reduce the welfare bill; and cyber security has been rightly identified as one of the top priorities in the defence review.

But that doesn’t mean that the next four years will be easy for public sector IT professionals.

Of the predicted 490,000 job losses, undoubtedly many will be from IT departments either through staff not being replaced or, more likely, through workers being transferred to the private sector in IT outsourcing deals.

Government CIO John Suffolk’s exhortation to Indian IT providers to “bid, bid, bid” for contracts may see some Whitehall IT staff facing the uncertainty of working for an offshore supplier with a long-term need to shift work overseas to make those deals profitable.

While there are skills shortages in some areas of the private sector, it is still a tough recruitment market for anyone looking to switch to a corporate IT team – just look at Lloyds Banking Group’s recent announcement of 4,500 IT job cuts.

And in local government, one of the biggest public sector IT employers, 7% cost savings every year will be keenly felt.

IT suppliers will be licking their wounds too – with £1.2bn of contract reductions already delivered and another £1bn on the way. But the amount of IT spending still to come will make sure they don’t suffer too much in the long term.

So what will public sector IT look like in five years? Expect technology to be even more central to efficient and effective public service delivery than it already is. But expect also that an even more significant proportion of public sector IT will be run by the private sector.

If you want to build a career in government IT, your future will be founded on strategy, IT management and supplier relationship skills, not the technical needs of implementation, delivery and support.