Some of the money will go on a series of ambitious public sector IT projects to deliver the prime minister's much-publicised aim of getting all local government services online by 2005.
But if the spending is to lead to real service improvements the Government must listen to public sector IT leaders.
Jim Haslem, president of the Society of Information Management (SOCITM), the local authority IT directors' organisation called for extra cash to sustain many of the trailblazing e-government projects launched under the government's Pathfinder initiative.
"There needs to be some ongoing funding to drive through some of the initial developments that have been sponsored to date. Many of these projects have not developed sufficient critical mass to be free-standing and sustainable," he said.
Haslem also suggested that money should be devoted to integrating IT across central government itself.
Bernard Diamant, director of corporate services at the London Borough of Brent, said basic funding for e-government was the issue.
"The funding so far announced is falling far short of requirements to meet the targets that the Government is setting."
The Government has committed itself to a major boost in health service IT funding, but NHS IT professionals fear they may not see the money.
A handful of national projects and day-to-day running costs of hard-pressed NHS trusts could swallow up extra cash
One NHS IT manager in a trust said, "There appears to be the commitment to deliver billions of pounds to support NHS IT, but we haven't seen any of that money yet."
An IT systems design expert in a specialist NHS Trust urged the Government to get a clearer idea of the state of NHS IT.
"I would also like to see some benchmarking of where NHS IT is now," he explained.