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Government CFO, Government Procurement, Tax and Revenue Management

UK govt cuts over US$400 million in ICT costs

By Rahul Joshi | 14 August 2012 | Views: 1490

The UK Cabinet Office has announced a successful campaign to slash civil service costs in fiscal year 2011/2012: £104 million (US$163 million) were saved from terminating ICT projects, reducing digital service delivery costs and in telecommunications, while “better scrutiny of ICT projects” saved the Government £145 million (US$227 million).

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Meanwhile, a massive £422 million (US$661 million) were saved through consolidating purchases for the whole of the government when possible.

Consultancy spending has been especially tightened, with 85 per cent in savings since 2010 — to the effect of nearly £2 billion (US$3.1 billion) over two years. Renegotiations with suppliers — some of them in ICT — managed to save the public service almost half a billion pounds.

Minister for the Cabinet Office, Francis Maude, commented that the cuts were in response to Government deficit and the prevailing financial climate.

He asked why such savings were never made before and “why was so much taxpayers’ money squandered on things like unnecessary consultancy, wasteful marketing and underused property leases?”

“Because our controls on spending are working well and saving unprecedented amounts of money, I’m determined they will be a permanent feature of good governance,” he commented.

The savings are a part of the UK civil service’s long-term austerity programme, in which it has targeted £20 billion (US$31.4 billion) in cost cuts per year over the next three years. It managed to exceed the expected £5 billion (US$7.8 billion) in cost cuts over the last fiscal year.

Addressing a gathering of CEOs and senior representatives of 31 of the Government’s key suppliers at the end of 2010, Maude had vowed to cut down on government bureaucracy surrounding procurement and had promised that the new processes would be less costly and time-consuming for the suppliers.

He had also warned that “the days of the mega IT contracts are over, we will need you to rethink the way you approach projects, making them smaller, off the shelf and open source where possible.”

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