In this week’s Spending Review, George Osborne unveiled his plans to cut £11.5 billion in 2015/16, with many central government departments facing significant budget cuts - some as much as 10%. It’s clear that the age of austerity is still far from behind us! While the Chancellor painted a bleak picture, let’s not overlook the fact that IT reforms are just some of the measures that have already contributed to around £5 billion of savings.

Technology played a key role throughout the spending review in two main ways: reducing costs and driving innovation. Central government and the NHS in particular were called out in the Spending Round 2013 as key areas where improved use of technology and better procurement would contribute to significant savings. For central government, it’s estimated that approximately £1 billion will be saved via the “purchase of common goods and services through the government Procurement Service, negotiating better deals with suppliers and making better use of IT.”

For me, such huge savings will not just come from better negotiations or even better use of IT, a complete step change in the way government approaches IT. For too long, public sector organisations have reverted to what they know and selected services via large integrators and suppliers. Rather than seriously considering innovative technologies - such as the cloud - for their requirements, organisations have continued to get locked into lengthy (sometimes decade long) contracts with tech goliaths. These vendors continue to supply them with complex, legacy technology that simply doesn’t meet the needs of today’s workforce that demands mobile, secure anytime, anywhere access and the ability to work across the firewall with consultants and partners, not just colleagues within their department.

The Cloud First strategy, although long overdue when launched in May, should hopefully instigate the shift in how government views, procures and adopts IT. Mandating central government to look at cloud technologies before purchasing traditional systems, it would be great to see this policy extended across all public sector organisations. Yes, the G-Cloud may have hit the £25 million milestone this week, but there is so much more to be done. This is just a fraction of the estimated £18 billion that UK government currently spends on technology. With such huge cost saving goals to hit the government can no longer ignore the agility, scalability, flexibility and efficiency benefits that the cloud offers.

Innovation via technology was also a key theme. The Chancellor pushed for government to use digital technology as its principal channel for business - digital by default - to save around £800 million and pledged £185 million of additional funding for the Technology Strategy Board. This fund is to specifically support innovation such as Catapult Centres and the Biomedical Catalyst. It was also great to see continued commitment to investment in the broadband infrastructure, which is key to support businesses and workers nationwide.

Faced with its age-old challenge of large budget cuts, but still tasked with providing the very best public services, I hope many public sector organisations now look at their ICT systems in a new light and consider how they can streamline processes and drive innovations using technologies.
With the focus for IT reforms now on efficiencies, innovation and the cloud, the £300 billion investment in infrastructure - namely broadband, science and schools - is paramount. We need to ensure government and enterprise organisations have access to the correct infrastructures and tomorrow’s bright sparks are supported.