Local authorities will be the first beneficiaries of a revolutionary partnership between Microsoft and Newham. The council is working with the software company to develop a number of applications that could benefit other councils in the UK – although the creation of an open source model might stun some of Microsoft’s critics.

“We aim to create a system where lots of other local authorities could benefit,” said Newham Council’s deputy head of ITT, Geoff Connell. “For example, we’re working with Belfast City Council on a CRM application and we’re aiming to reduce total cost of ownership. We hope that they will take our system, make it better and give it back to us for free. We have also developed adapters to create applications and middleware that we're making freely available to other local authorities."

Connelll stressed that the aim was not create a business arm of Newham Council but to improve the way that local councils could improve the services they offer. "This is not about making big profits,” he said.

Such a way of working may raise eyebrows among those in the open source community who have been the fiercest critics of Microsoft in the past. “The irony of us using Microsoft’s products for an open source type deal had not escaped me,” said Newham Council’s deputy head of ITT, Geoff Connell.

Connell believes that Newham is in the forefront when it comes to IT within local government and points to several initiatives, such as tablet PCs for social workers, that have improved the way that the local inhabitants could interact with the council.

The council is widely seen as a leader in IT, which is why it was a shock when the council council abandoned its participation in an open source trial last December and struck a deal with Microsoft. Both parties remained tight-lipped about the financial details of the partnership but the council pointed to research from CapGemini that pointed out that using Microsoft’s products would be considerably cheaper, about 13.5 percent cheaper than an open source approach.