By David Williams
17 February 2011
A moratorium on public sector IT projects could mean the government is missing out on opportunities to improve services and save money, ministers have been warned.
The Confederation of British Industry underlined the benefits of investing in IT today, as the National Audit Office published its Information and communications technology in government landscape review.
Emma Watkins, head of public services policy at the CBI, said: ‘While it’s right to focus on getting value for money, imposing a moratorium on IT modernisation could mean we are missing out on the potential benefits that making better use of technology can deliver.’
She claimed there were ‘many good examples of how technology is improving service delivery’ – from giving midwives handheld devices so they can access patient records on the move to installing emergency alarms in the homes of older people, allowing them to live independently for longer.
Today’s NAO report examines the challenges government faces in protecting value for money in IT projects and ensuring Whitehall makes the best use of IT as it tries to save money.
The report says three initiatives from the government’s Efficiency and Reform Group have demonstrated a stronger central grip on IT spending as ministers attempt to implement short-term cuts in 2010/11.
These are a mandatory review of all projects worth over £1m, contract renegotiations with major suppliers, and a moratorium on new IT projects.
The freeze covers all central government departments, agencies and quangos, and applies to new contracts, contract extensions and modifications. It can only be over-ridden with the explicit agreement of the Cabinet Office minister.
So far 76 IT projects worth at least £1.7bn have been reviewed. Only six, worth £36m, were rejected, but the Cabinet Office estimates a further £200m was saved through adjusting projects that were approved.
Another £1bn is likely to be saved over the next five years by not renewing 229 IT projects. The moratorium would have produced further reductions in spending, as departments cancelled more projects rather than submitting them for review.
The NAO concluded that spending on IT will ‘almost certainly’ be lower in this year.
Margaret Hodge, chair of the Commons Public Accounts Committee, said that government IT projects have ‘gone badly wrong’ too often, resulting in expensive delays.
The NAO report ‘sets out clearly the challenge facing all departments in future’, she said.
‘As I see it, this can be summed up in one question: how can the public sector harness the benefits of IT without being overwhelmed by the complexity of IT projects and allowing them to spiral out of control?’
