The document revealed local authorities will spend£3.2bn in 2008-09, beating the previous record set in 2005 and an increase of 5% on the previous year.
John Serle, editor of Socitm IT Trends said: “There remain some big opportunities for ICT to transform local public services.
"The things that were easy to do have been done. Organisations will need to be bold and ambitious with their use of technology in the next few years.
“Some of the new emerging technologies can be exploited to transform local public services, delivering better more cost effective customer service.”
Staff costs now account for 44% of overall IT spending, followed by external services (13%), software (12%) and hardware (11%).
The figures come from the society’s annual survey Uncharted Waters, based on a questionnaire sent to 600 local public services providers across Britain.
Socitm’s survey suggests that although resourcing for IT has increased, councils’ investment still lags behind the private sector’s, with many reluctant to borrow to finance schemes.
Many councils reported difficulties with recruitment and retention while security and privacy has also leapt to the top of managers’ agenda.