IDC predicts e-government spending boom

E-government projects will boom over the next 12 months, with services companies and outsourcers likely to benefit, according to research from analyst IDC.

Progress on e-government has been patchy, with the UK lagging behind other European countries in terms of sophistication of services and readiness.

But IDC predicts that e-government spending in the UK will grow by 23 per cent over the next 12 months to €518m (£331m).

James Weir, senior research analyst at IDC, told vnunet.com that e-government opportunities are bucking the trend in a flat IT services market.

"This is one area where IT service providers are seeing real growth on the consulting and systems integration side," he said.

"In the last year the focus was on communicating with citizens and the front-end to services. This year it's much more of an outsourcing play."

And while the big consultancies such as EDS and IBM Global services stand to grab the lion's share of central government contracts on offer, IDC believes that local government projects will offer a good opportunity for smaller IT services companies.

"Cost and a good track record is important, as is proving that you can provide these solutions in a standardised way," said Weir.

Meanwhile, the government has published a national strategy for local e-government to support local authorities in getting services online by 2005.

This follows concerns that a common framework, and support from central government, is key to offering services that make a real difference to citizens.

"Central government in the UK is quite sophisticated in its use of outsourcing and procuring IT services, but local government isn't," explained Weir.

"Offerings have been very patchy. Some boroughs were doing exciting things such as full transactional services, but others have been dragged kicking and screaming into offering online services."