Pre-budget report: £300m IT overhaul announced

An IT overhaul of departments will be at the heart of the chancellor of the exchequer's £330m modernisation scheme to achieve key savings by 2011.

The scheme, announced in the 2007 Pre-Budget Report and Comprehensive Spending Review, will involve investing in a modern, high-capacity IT infrastructure in HM Revenue and Customs to support higher take-up of online services, more efficient processing and communication, and better risk-based compliance checks, generating annual net cash-releasing savings of £180m by 2010-11.

It will also involve rationalising HM Treasury's IT estate and full implementation of Group Shared Services, generating annual net cash-releasing savings of £10m by 2010-11.

Procurement savings including travel services and IT and telecoms are expected to realise savings of £14.7m annual net cash-releasing savings by 2010-11.