Chancellor urged to save billions through IT

An influential MPs' committee has urged Alistair Darling to save billions of pounds through improved use of IT according to committee report recommendations.

In a letter sent to the chancellor yesterday, Edward Leigh, chairman of the Committee of Public Accounts, recommended the government make a number of significant improvements. These included changes its management of information and use of shared services, as well as lowering the prices it pays for consultants.

The recommendations were part of a raft of suggestions detailed in Leigh’s letter, which predicts £9 billion in total cost cutting could be achieved with IT contributing a notable part.

A sizeable £1.4 billion could be saved through improving shared services, Leigh wrote, adding that this would affect finance and human resources costs the most. He stated that in spite of “considerable discussion and planning, so far achievements have been limited”.

The use of fully integrated supply chains for public sector construction would play a part in £2.6 billion further savings, Leigh added.

The hiring of consultants also came under the microscope, with Leigh stating £408 million could be saved by reduced spending, as well as achieving “better value for money” by exploiting the government’s scale when negotiating contracts.

Scale could be better exploited in the procurement of all goods and services, including IT, Leigh wrote. Some £520 million could be saved through “enhancing staff skills and incentives” at OGC.buying solutions, the government’s procurement management arm.

Further significant gains could be made in areas including better financial management and the reform of benefits, Leigh wrote. He noted the government had already achieved extensive savings in a number of areas, including reducing the complexity of services and improving management.

"Our recommendations have led to savings in excess of £4 billion over the course of the last two parliaments but wider take up of our recommendations could reap far greater rewards," Leigh wrote.

Successful changes in individual departments needed to be replicated across the government in order to tackle the “slow progress”, he added.

“At present the government answer our recommendations on specific reports and the National Audit Office works with the relevant department to identify the financial savings attributable to our work,” he stated. “But there is little evidence of our recommendations being used as a spur to action across government despite the fact that they are often replicable at a number of departments.”

Copyright © 2009 IDG Communications, Inc.

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