Council ICT spending is forecast to increase by 9% to £3bn in 2007/08, following a fall last year.
Efficiency and security top council IT chiefs' agenda, says the Socitm IT Trends 2007 report.
The report, based on responses from 470 council IT heads, says customer relationship management (CRM) is established in most organisations, but not yet integrated with their back offices.
Staff turnover has also increased dramatically and the use of consultants continues to rise.
Renewed pressure on public services to achieve efficiency throughout the organisation, following the Comprehensive Spending Review 2007 and the toughest financial settlement in years, should focus attention on ICT as a means of achieving this goal, says the report.
With the HM Revenue & Customs data loss debacle still fresh in the mind, IT Trends 2007 provides data and commentary on security issues.
Respondent organisations have between them identified over 180 security concerns ranging from careless use of passwords to data centre disasters.
The cost of securing information held on local government computers has dramatically increased since 2006, although direct financial losses reported remain low, the report says.