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Whitehall spending on computer consultants and information technology will be slashed in a effort to raise £5billion in efficiency savings. Issuing the order in his Pre-Budget Report, Alistair Darling said he was confident that lowering the cost of IT and its external personnel would not hurt public services. He hopes that, over the next three years, the state can yield £35bn in savings, up from £30bn, and extra to those the Comprehensive Spending Review identified until 2011. Departments will also look to lower the cost of lawyers, as well as staff in back-office operations, to meet the target, aimed at part funding the £20bn economic stimulus. Inflating the savings target was achievable, the Chancellor said, because “independent reviewers have identified new efficiencies across public sector operations.” Such cost-cutting efforts will remain at the heart of Whitehall from now until beyond 2012, given a commitment to “deepen” the drive in the next Spending Review period. Already the government has made room for £26.5bn of efficiency savings since 2004, £5bn over target, and removed 86,700 civil service posts in the three years to 2007. Yet to make the new efficiencies, such as increasing shared services, the state will not tell local or health authorities, or central departments how to find them exactly. Ovum analyst Peter Clarke said that, for the state’s IT suppliers, the tightening budgets will demand a confident, considered response to meet the sector’s concerns. “Those software and IT services suppliers that seize the opportunity can act as the catalyst in driving out efficiencies and improving the quality of public services,” he advised. “Now is the time for suppliers to intensify the conversations about efficiency and improvement in public services which they have been having with the public sector over the past three or four years.” But even if suppliers do act before their client does in terms of finding efficiencies, the sector may still be anxious about targets, despite overachieving its existing one. “The government has become increasingly impatient that the public sector has not moved fast enough to achieve back-office efficiencies or achieved the efficiencies in more radical ways,” Clarke said. “What we heard… was a chancellor determined to achieve that goal sooner rather than later.” Nov 27, 2008 Email this article Printer friendly page Previous Page
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