Public sector faces fundamental change in the way it delivers IT

Local and central government departments must fundamentally change how they deliver IT services as they face swingeing budget cuts.

Local and central government departments must fundamentally change how they deliver IT services as they face swingeing budget cuts.

Regardless of who wins the election, the next government will be under pressure to reduce its borrowing and the budget deficit, which is expected to grow to £178bn this year.

Labour has announced its latest IT strategy which focuses heavily on cost cutting. It says there will be annual savings to the public purse of £3.2bn from 2013-14 .

"We have seen a period of significant change over recent months and years. Technology has changed, the economy has changed and ICT in government must also change," says government CIO John Suffolk.

Local government is also under pressure. John Serle, author of the trends report for local government IT managers group Socitm, says councils are fully stretched. "It is no longer possible to meet the challenges by doing what we have been doing," he says.

Socitim predicts that local authorities will spend 11% less on IT this year and reduce IT staff by 10%.

Suffolk makes no bones about the scale of the challenge facing government IT. He spoke of inevitable spending cuts in public sector IT, regardless of the next government, at the launch of Socitim's annual report on IT spending in councils.

"We have to tighten our belts, take out duplication and sweat assets. It is common sense," he says.

Government Cloud

The government will be driving departments to put services in the cloud, where they can share resources. The Government Cloud (G-Cloud) strategy is in its planning phase, with about 100 people working on it.

"Just as we would not expect people to generate their own electricity, IT is becoming a utility. G-Cloud should deliver considerable savings to as many public sector bodies as possible," says Suffolk.

Government departments will share details of what applications they use and make them available via a Government Application Store. They will be able to piggy-back on existing contracts rather than negotiate new contracts with suppliers.

"One of the problems we all have is we do not know what other people have done. The Application Store gives a window to what everybody has done and gives others access to it," says Suffolk.

Removing duplication

Further potential savings will come from removing duplication, such as where departments each have their own datacentres. Technology such as virtualisation software will help.

John O'Brien, senior analyst at Ovum, who has produced a report into IT services in the public sector, says the introduction of the G-Cloud will take shared services to the next level. "This will help interoperability, increase sharing and reuse which all potentially cut costs," he says.

O'Brien warns that because cloud computing is in its early stages of development it will not be an easy transformation.

"G-Cloud is a good idea but it is still very early days and suppliers and buyers are still finding out what it means to them," he says.

Cost cutting will increase outsourcing, says O'Brien. "The market for outsourcing and services is the biggest we have seen since PFI-type contracts were introduced."

But he thinks 2010 will be difficult for IT heads to sign off deals. "We believe the election will delay decisions," he says.

Kept in the dark

Not every one is pleased by the government's announcement of its IT plans. One IT director in the public sector told Computer Weekly that government IT professionals have largely been kept in the dark over the strategy.

"It is not good when the people involved in decisions find out about new plans through the press rather than internal communications," he says.

"The Application Store sounds a good idea but there no guarantee of success. If you put something in place that makes things more efficient, with less people required, it will struggle to get accepted."

Whatever happens at the general election next year, IT professionals in the public sector face seismic shifts in strategy. Public sector IT is having to react to economic conditions like never before.

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