Ofcom has achieved yearly cost savings of £6 million after implementing a project to rationalise its IT, according to a new report.
The regulatory body for the telecoms industry was created in 2003 as the result of a merger of five regulators.
The savings in operating and capital costs, most recently achieved in 2009-10, were a result of the organisation spending £33 million over a five-year period from 2005 to rationalise its IT systems, said the National Audit Office in its report on Ofcom, ‘The effectiveness of converged regulation’.
However, despite having noticed the benefits of the investment, the NAO said: “It will be some time before the investment [of £33 million] pays back.”
Ofcom said that a total aggregate saving of £23 million had been realised so far.
It added: "The investment was not just focussed on ICT replacement as it was part of a significant business transformation programme, enabled by ICT. As a result of this the investment has and will continue to deliver significant cost savings across the whole of the organisation, not just in ICT.
"The new ICT services have enabled a robust and integrated business platform which supports and protects critical UK communications infrastructure. This includes licensing and technical assignment of spectrum services and contact with thousands of consumers and stakeholders each year."
NAO’s report also shows that Ofcom’s annual expenditure, of £122 million in 2009-10, is around 27 percent lower than of its predecessor bodies.
NAO said that IT expenditure, which has been on a generally downward trend over the past six years, was £2.8 million in 2009-10. The most that the body had spent on IT was £14.96 million in 2004—5, which plummeted to £4.4 million in 2006-7. IT spend was at its lowest in 2007-8, the height of the economic recession, at £2.6 million, but had crept back up to £3.9 million the following year.
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