CSSA: supply industry bearing up

E-government could be the short-term saviour of the UK's IT services and software industry, said John Higgins, director general...

E-government could be the short-term saviour of the UK's IT services and software industry, said John Higgins, director general of the Computing Services and Software Association (CSSA).

The comments were made as Higgins released the CSSA's latest CEO trends survey, which found that suppliers' morale was surprisingly resilient, despite the economic downturn.

Some 30% of the 760 UK-based software and IT services companies polled said they were either fairly or very pessimistic about their company's prospects in the forthcoming quarter.

Just over half of those polled (52%) revealed that their turnover remained static or fell during the last quarter, while a further 44% expected turnover to remain static or fall during the next quarter.

As businesses trading with Europe approach the 1 January deadline for euro compliance, the survey reported that UK suppliers were evenly split on the single currency. Some 45% thought membership of the single currency would benefit the UK, while 44% disagreed.

Despite this, 67% believed that the UK would join the single European currency within the next five years, but 60% reported that their business had not yet begun preparations for the introduction of the euro in the UK.

CSSA members, like the British Chambers of Commerce (BCC) - which presented a critical e-government report to ministers today - thought the Government would not hit its targets.

Almost two thirds of respondents thought the 2005 target for 100% electronic availability of government services would be missed. However, unlike the BCC, two thirds thought the Government should retain the targets.

Commenting on the survey, John Higgins said: "The survey clearly demonstrates that our members are continuing to encounter difficulties in the UK business-to-business IT services and software market.

"However, it is also clear from the survey that many members believe that Government investment in e-government services could act as a catalyst for economic recovery."

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