Conservative-Lib Dem coalition: Tech industry nervous on prospects

Offshoring is expected form a central theme for technology in the newly announced Conservative-Liberal Democrat coalition, but there is likely to be a significant “dead period” before contracts are announced, observers note. Meanwhile, heavy spending cuts are expected to be announced within weeks.

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Tory promises are much tougher. They brought in former Labour efficiency adviser Sir Peter Gershon, who calculated that a further £12 billion could be cut, including £4 billion from public sector IT and £3 billion from contract renegotiation.

In recent months, IT workers across the UK on public and private sector contracts have protested at job losses, difficult conditions, pay freezes and the limiting of their retirement benefits. A number of workers have even gone on high profile strikes, with HP and Fujitsu seeing major industrial action on key contracts. The Conservative party has traditionally taken a harder line on unionism, but Cameron’s position remains to be seen, especially with the Liberal Democrat influence.

The Conservatives also say they would cap projects at £100 million. But no definition has been given so far on how having smaller IT projects would deliver definitive improvements.

The Liberal Democrats called for improved government IT procurement, and encouraged greater use of cloud computing and open-source software.

The coalition may focus IT efforts on the use of shared services to cut costs. But successful examples remain scarce, so far, and the move has been described as a "massive" culture change.

A debate continues to rage over the new Digital Economy Bill, which became law last month. Users face being cut off if they access pirated material. The Conservatives supported the Bill, but the Liberal Democrats expressed staunch opposition – supported in their calls by broadband firm Talk Talk and the Open Rights Group, who said it limited free speech and imposed heavy burdens on internet service providers.

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