Council IT spending to hit £4 billion by 2016?

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Local government spending on ICT projects will continue to grow and could hit £4 billion per year by 2016.

So claims public sector information service Kable.

In a local government forecast report published this week, Kable argues that the growth in council spending on ICT will be driven by transformational outsourcing projects, online channels and an increase in mobile working.

The Local Government Forecast: Opportunities in Austerity report puts forth that councils are increasingly moving towards outsourcing from the more traditionally favoured shared services approach.

While some authorities still only outsource single functions, since January 2007 outsourced projects covering multiple functions have outnumbered them four to one.

“Councils have had to draft contracts so that efficiency savings are stated and measurable by both them and their supplier,” argues Kable senior analyst Michael Larner, who authored the report. “This shared risk and reward approach has meant that suppliers need to be confident of their ability to deliver, but also authorities need to be clear in articulating their requirements.”

According to the report, this increase in the resources being applied to ICT projects will gradually move decisions about IT beyond the responsibility of just IT managers to increasingly include finance directors and chief executives too.

The increase in ICT budgets is seen as going hand in hand with councils moving service delivery and citizen interaction facilities online in a bid to reduce costs. Larner singles out Glasgow, where citizens can complete benefits applications online, and East Renfrewshire, where users can personalise the council site to suit their preferences, as two councils setting the kind of example other areas should look to follow.

“In future, council websites could mimic iGoogle,” said Larner – referring to the Google home page which can be personalised to favour specific online tools and services whenever a user logs in.

One of the major challenges facing councils in the next few years, says Kable, is improving the efficiency of their infrastructure for remote workers. Local authorities already have the largest mobile workforce anywhere in the public sector, and Kable predicts current numbers of around 265,000 could nearly triple by 2016, while the number of flexible council employees could rise from 530,000 at present to 1.2 million.

This increase will put pressure on councils to invest in remote network access, portable computing solutions and accessible software to make their systems more efficient.

“The immediate future for local government ICT remains challenging,” Larner predicts, “but innovative suppliers assisting in the delivery of tangible savings will still find a receptive audience among senior managers in local authorities.”

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