The future of Government IT?

The Cabinet Office has prepared an interim Government ICT strategy which is due to go before the CIO Council for ratification at its meeting today. It’s an interim strategy to give the next Government CIO a chance to make changes...

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The Cabinet Office has prepared an interim Government ICT strategy which is due to go before the CIO Council for ratification at its meeting today. 

It’s an interim strategy to give the next Government CIO a chance to make changes before the final document is published. Joe Harley, CIO at the Department for Work and Pensions, is expected to be the new Government CIO, after John Suffolk leaves.

The new strategy is likely to give departmental CIOs more power, including an ability to stop, or call time on, unnecessary projects. 

The Coalition’s strategy for savings, as enacted by the Office of the Government CIO and the Efficiency and Reform Group, have worked well so far, under the minister Francis Maude and his key officials Ian Watmore,  Katherine Davidson (Ex-McKinsey and head of implementation at the Conservative Party and now Director, Efficiency, Reform Strategy), Chris Chant, formerly CIO at DEFRA, and Bill McCluggage, Deputy Government CIO and Director of ICT Strategy & Policy.

That success so far has been largely because the Coalition has insisted that all projects costing over £1m be submitted to the Efficiency and Reform Group for approval.

Officials say that about a third of IT-dependent projects have stopped, some of them large, merely because managers decided not to submit them to permanent secretaries for approval, in case their usefulness or importance were challenged by the ERG. 

These savings are regarded as easily made: the picking of low-hanging fruit. It’ll be harder to achieve savings that some officials estimate to be, potentially, £8bn on the annual public sector IT spend of about £17bn.

A hefty chunk of those savings could come from G-Cloud and data-centre consolidation which means ceasing to pay for thousands of government data centres. In October 2010 John Suffolk said that central government has more than 8,000 data centres which, with determination, could be cut down to around 12. Data Consolidation and G-Cloud are part of the new interim ICT strategy.

Several departments and suppliers are helping the Cabinet Office develop the G-Cloud strategy, including the Department for Education. 

The aim with G-Cloud is for departments not to renew major IT outsourcing contracts and instead buy, in components, the IT they need from a choice - or framework - of commodity suppliers whose offerings and service management have been verified for quality, usefulness and security.    

Cloud services purchased in this way would avoid the need for departments to be locked into long-term contracts with poorly-performing IT suppliers.

Officials say that suppliers give departmental CIOs “service credits” in compensation for shortcomings. This may mean a cut of millions of pounds in the annual cost of an IT outsourcing contract if agreed service levels aren’t met. But CIOs are still locked into the supplier by a long-term deal. They would rather receive no service credits and get a good service.

Under the Cloud strategy, CIOs could swop suppliers with little notice if the service is poor. They would pay for the service on a per-user-per-month basis - with no upfront payments. 

It would also mean that government CIOs would no longer have to guarantee a minimum length of contract or minimum volumes of work.

The appeal for suppliers would be a framework contract - similar to a catalogue - which would avoid the costs of an EU procurement. Suppliers could attract several departments to say an open-source email system without going through a separate procurement each time.

As CIOs are not requiring unique services and products, suppliers can avoid large upfront costs. Companies supplying government would be G-Cloud-approved or recommended. 

Several departments are said to be lining up to become early G-Cloud users but are waiting for the ICT strategy to be finalised, to ensure compliance with it. Officials say that if spending cuts become more harsh, departments will not need to be coerced into participating: they will see the benefits for themselves. 

In case some departments continue to adopt a “silo” approach, the Cabinet Office will work on benchmarks and metrics that establish the low cost of Cloud offerings. Before departments sign new long-term large IT contracts they will have to show that their costs are value for money.

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