Taxpayers' money could be wasted on electronic services that no one will use, according to a National Audit Office (NAO) report out this week.
The NAO said this could be the case unless the government plans IT projects more efficiently and markets them more effectively.
This may even mean redefining the government's target of putting all services online by 2005 to include take-up goals and making them available through the private sector, claimed the Better Public Services Through E-government report.
Sir John Bourn, head of the NAO, said: "A significant amount of taxpayers' money is being spent on delivering public services through electronic means.
"The major challenge is to get services online and to encourage and enable people to use them.
"Otherwise the considerable potential gains in departments' efficiency will not be delivered and large amounts of public money will have been wasted."
The government's bad track record with major IT projects, and the lack of any methodology to measure the efficiency of putting services online, are the key risks to e-government, according to the report.
Low public awareness and a lack of trust in government services must also be addressed if they are to be taken up online.
"This suggests that departments may increasingly need to use intermediaries such as banks, building societies, post offices and retail outlets to provide services to citizens," says the report.
Departments have raised several concerns about meeting the e-government deadline and the report makes several recommendations.
Just over half of the 524 services that government departments routinely provide are currently delivered online. But the report pointed out that few are transactional services that allow the public to interact with government, like applying for a driving licence.
The NAO compiled the report after examining seven central government IT projects and comparing the benefits achieved with private sector projects by the RAC, BT, Oracle and Anglian Water Services as well as e-government developments abroad.
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