Cloud is first port of call for your IT needs, public sector told

Smaller firms with cloud-based products and services should have priority over their larger counterparts when the cash-conscious public sector comes to awarding IT contracts to the private sector.

Introducing its ‘Cloud First Policy’, the government said that, under it, it will be compulsory for central departments to initially evaluate online-only solutions before considering any alternative when procuring new or existing IT services.

Although the “quicker, cheaper and more competitive” approach is only recommended for the wider public sector, all central departments must now prove that an alternative to the cloud offers better value for money before opting for it.  

Alongside the new onus on public sector IT buyers to use the government’s CloudStore – an e-marketplace of more than 7,000 IT services (two- thirds of which are provided by smaller firms) across all cloud service models – the government updated the associated framework.

As a result, public sector bodies using the framework - G-Cloud version three - can forego holding a mini-competition (or OJEU tender) because the government has already run open procurement for it, as it did with the previous two versions.

Both the new framework and the ‘Cloud First’ policy, underpinned by an overhaul to the CloudStore to make it more buyer-friendly, are designed to return IT spending savings, on top of the £316m saved through IT reforms in 2011-12.

“Many government departments already use G-Cloud, but IT costs are still too high,” reflected Cabinet Office minister Francis Maude. “It’s quicker, cheaper and more competitive, open to a wider range of companies, including a majority of SMEs, and offers more choice and innovation.”

Evidencing his claim, officials said the ‘off-the-shelf’ offerings of the 700 or so firms in the framework – 83% of which are smaller firms, can be up to 30% of the cost of bespoke IT solutions.

The government's cloud programme director Denise McDonagh said: “Sales from G-Cloud are rising steadily, with cumulative spend now over £18 million…This is still small relative to overall government IT spend, and the transition to widespread purchasing of IT services as a commodity won’t happen overnight.”

According to the latest figures, central government spends about £8billion a year on IT, while the public sector as a whole comes in at about £16bn over the same period.

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Written by Simon Moore

Simon writes impartial news and engaging features for the contractor industry, covering, IR35, the loan charge and general tax and legislation.
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