Government sees £316m saving from IT cost cutting

The government reduced its spending on ICT systems by £316m in 2011-2012 as it makes good on its promise to cut down on unnecessary expenses, according to a report by the National Audit Office (NAO).

However, the NAO was unable to prove if this was as high as the £348m the government itself claimed it had saved over the same period. Nevertheless, the report noted that the government is also on target to makes a further saving of £200m by March this year.

While the Cabinet Office was praised for overseeing this reduction in spend, the NAO called on those in charge to ensure viable, beneficial systems were put in place too, to reap the full benefits of the digital market.

"It needs to develop a more comprehensive assessment of the impact and effectiveness of its ICT and procurement reform initiatives," said Amyas Morse, head of the National Audit Office.

"The big challenge will be to move from savings initiatives to achieving digital transformation of the civil service and the public services it provides."

In particular it said that the government must show how it is improving IT delivery, both internally and externally, rather than just where it had cut costs to demonstrate a complete positive impact.

For example, it said it was unclear how successful the move to make it easier for SMBs to sell to government has been and that some suppliers are complaining the government is still to set in its way to consider alternative technologies to those that exist already.

The report from the NAO was welcomed by the Cabinet Office, with a spokesperson saying it would take its report on board as it seeks to further improve its savings and services.

"We are determined to fully open up government ICT to smaller, more innovative companies, and to embrace open source technology," the Cabinet Office representative said.

"As we reform the Civil Service, the government has committed to providing 'digital-by-default' services designed around the needs of the user, as set out in its Digital Strategy and the departmental digital strategies published at the end of last year.

The Cabinet Office added that it expects the first wave of public services to go live in April, which could lead to savings of £1.2bn by 2015.