Budget 2010: How government departments will save £500m on IT

Five government departments set out strategies for slashing their IT-related spending.

Department for Work and Pensions

The Department for Work and Pensions has identified £180m in savings. It plans to get better value out of its major contracts, including IT contracts, by working more closely with suppliers and by reducing demand. The department said it would also use its workspace and IT resources more flexibly. It would take action to reduce fraud and error in the benefit system, recover debt from overpayments, reduce the amount of office space used, cut spending on consultants and improve procurement.

Home Office

The Home Office plans to make £90m of savings by focusing on operational efficiency. It plans to improve case management systems to speed up case resolution at the UK Border Agency. The department has identified £40m of savings through the introduction of standard rates to reduce the use and cost of consultants. The Home Office expects to save £80m from a 20% reduction in IT expenditure, of which £40m has been saved though renegotiation of existing contracts for basic IT services.

Ministry of Defence

The Ministry of Defence plans to make £130m of savings by replacing legacy IT systems. It also expects to make £120m of savings from greater use of collaborative procurement on construction, food and IT, as well as better management of the defence estate, plus savings through greater efficiency in equipment support.

National Health Service

The NHS said it will make £100m of savings by taking a new approach to the National Programme for IT, which it says will offer greater choice to local hospitals. This is part of the £600m reduction in lifetime costs announced in December 2009.

Department for Transport

The Department for Transport announced it would make £40m of savings by streamlining back-office functions across finance, HR and procurement, together with £30m of savings from reducing spending on consultancies.

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