Local authorities will spend £3.3bn on IT in this financial year and will have to continue to invest heavily if they are to complete the business transformation projects that have been demanded by central government, according to a survey by local authority IT managers group Socitm.
The projects are required if local government is to deliver cost savings and drive up the use of e-government channels, ministers said earlier this year.
Although councils' spending on IT is set to be 23% higher in 2005-2006 than in 2004-2005, local government is spending less on IT than organisations from other sectors that are undertaking business transformation projects.
John Serle, editor of Socitm's IT Trends report, said, "Councils are spending 2% to 4% of their revenue while the financial sector, for example, is spending 4% to 8%. If the new agenda is transformational, considerably higher levels of investment are going to be needed."
Socitm compared spending by local authorities with estimates from analyst firm Gartner of the average spending in other sectors.
Although councils are working on IT-driven projects to cut costs, the survey found no evidence of councils working on large-scale business transformation projects.
Serle said, "Things like hot-desking and not having people work from a central location are not in the consciousness of local authority people yet.
"One of the reasons is politics and the other reason is courage. There is a high possibility that things will go wrong with business transformation projects."
The technology landscape of local authorities is changing, the survey found. The PC remains the dominant technology used by UK councils, which plan to buy about 250,000 units this year. Dell has continued to increase its market share at the expense of its competitors.
Replacement cycles for all technology continue to lengthen. PCs and portables now have an average life expectancy of almost four years and servers four-and-a-half years, according to Socitm.
Councils appear to make little use of wireless technology either within their buildings or across the council area. "Considering the growth in PDAs and other mobile technology this is surprising," the survey said.
Microsoft's SQL database continues to grow in popularity and use of Oracle products is expected to increase.
Legacy mainframe systems also continue to disappear from councils. Use of Solaris appears to be in decline after a period of steady growth. But use of Linux is forecast to grow, and Windows 2003 Server is an emerging technology in local authorities, the survey revealed.