Government IT procurement strategy is still lacking in its commitment to independent benchmarking of contracts with transparent data, failing to understand the risks of legacy systems, remains unclear about how to address the IT skills gap with sufficiently senior and experienced people, and must move faster to implement 'digital by default' to design better IT services. Government must build "in house" contracting capacity if it is to achieve its intended cost reductions and address the significant challenges facing it in large procurement projects.
In a follow up report on the Government's response to the Committee's report into IT procurement in Government, released today Thursday 26th January, 2012, PASC commends the Government for its generally constructive and proactive response, but points out key areas where the Government's intended course of action will not be sufficient to address "the scale of behavioural and process change required across government" to achieve its own aims of becoming an "intelligent" customer.
The government has also failed to respond at all to the Committee's call for an investigation into the charge that the large systems integrators operate in the manner of a cartel.
The Committee's report concluded that a lack of up-to-date and accurate information about government IT made it impossible for the Government to identify potential overcharging, leading to the waste of an "obscene amount of public money". It recommended an independent investigation into allegations of cartel-like behaviour among suppliers, and that the Government work with "independent and specialist advisers and the NAO" to "seek to identify reliable and comparable cost benchmarks, and collect accurate information from departments in order to compare with those benchmarks." The Committee now says the Cabinet Office's commitment (in the response) to benchmarking through transparent data will help, but without also taking the independent external advice recommended by the Committee the overall outcome will not change, and the Government will not achieve its cost reduction agenda.
The Committee is also not convinced by the Government's approach to "legacy systems"- how the transition from existing to new IT systems is handled - properly addresses the underlying issues. At the very least, the Government should produce a long term risk-register identifying where and when investment will be needed to migrate and replace existing legacy systems.
The Committee welcomes and endorses the Government's acknowledgement of the need to grow its capacity in commercial skills of procuring and managing contracts, not just technical IT skills, in order to become an 'intelligent customer'. However, the Committee remains concerned that the Government's plans may not be adequate to cope with the scale of behavioural and process change required across the whole of Government, nor that the new Civil Service champions of 'agile development' will have sufficient seniority, expertise or support.
The Committee says there are obvious areas in which the Government could go further and move faster to implement 'digital by default'. For example, officials should be rewarded for using social media and digital channels to disseminate information and provide services (especially where this reduces reliance on other, more expensive channels). User feedback submitted via the Directgov site provides the Government with a great deal of free data on the strengths and weaknesses of its service provision. The Government must make good use of it, alongside other information from social media produced outside Directgov itself, to understand better how its services are used and perceived and, in turn, to design better services.
Comment from the Chair
Bernard Jenkin MP, Chair of the Committee said:
"This was a generally constructive response which we welcome, but it does not suggest that the government yet grasps how much must be done. The problems in IT procurement go deep and require major changes. This can only be achieved by bringing in IT executives and buyers from large and small companies, who understand what they are buying and the innovations on offer. This expertise cannot be contracted out.
It is a people challenge. The few new people brought in so far are having to battle against the failed culture of the establishment.
We also renew our recommendation of an independent investigation into allegations of cartel-like behaviour among the major systems integrators, which itself may prove structural rather than deliberate. We may have to return to this issue in a future inquiry."