The government's £6bn investment in IT systems will allow it to cut the number of civil servants by 84,000 and deliver more efficient public services, according to Chancellor Gordon Brown.
While some cuts were expected following the review of government spending by Sir Peter Gershon, the level of job losses is greater than anticipated. It had been thought that around 40,000 jobs would go.
"It is precisely because the public sector has invested £6bn in new technology, modernising our ability to provide back-office and transactional services, that I can announce, with the detailed plans departments are publishing for the years to 2008, a gross reduction in civil service posts of 84,150 to release resources from administration to invest in the front line," said Brown, unveiling his spending plans for the next three years.
But replying to the chancellor's speech, the Liberal Democrats insisted that abandoning ill-thought out schemes like ID cards would be a better way to make savings.
"If the police need more money, then it should be the £3bn ID card scheme that is cut," said Vince Cable, Liberal Democrat treasury spokesman.
Others have also questioned whether the technology investments made by the government are sufficient to deliver on Brown's promises.
Kevin Simmons, head of government financial management at IT services firm Atos Origin, maintained that the public sector was caught between making savings through standardising processes, while delivering local choice for end users.
"The government should take a leaf out of the private sector book. Many firms need to offer more customer choice by customising products, while keeping costs down. This means investing in agile IT systems," he said.
Simmons also questioned whether current back-office systems are up to the task.
"The government needs to look at investing in new systems. [Current back-office systems] would make it difficult to generate the savings within three years," he said.
In April 2002, vnunet.com exclusively revealed government thinking on how it could replace "civil servants doing routine tasks" with e-government services.
E-Envoy Andrew Pinder suggested that e-government advances could eventually lead to a reduction of up to one fifth of the civil service wage bill by 2012.
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