Public Sector could cut IT Outsourcing costs

UK Taxpayers are paying up to £6bn a year more than necessary for IT outsourcing services, says Compass, a consultancy that benchmarks the cost of IT in major government departments. Compass says it reached the £6bn figure after comparing the prices paid by government departments for their outsourced contracts with the market prices paid by the private sector for a comparable bundle of services. Compass says the UK public sector is paying 40% or more above the market rate for outsourced services. No surprise there then. We all know the Public sector pays more and their archaic procurement processes mean that they have one hand tied behind their back at the negotiating table and lack the bite of private sector companies that must save money or die.  

A government report last year put the total cost of public sector IT at between £12.5bn and £18.5bn a year. The estimate is wide ranging because the government does not collect any audited figures on its annual IT spend.

Note to George Osborne and Vince Cable; if you can’t count it, you can’t measure it!

Tags: , , , ,

Leave a Comment