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Weak IT ‘will hold back’ efficiencies

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The membership body for council IT managers has cast serious doubt over local government’s capacity to transform working practices in order to make much-needed efficiency savings.

The Society of Information Technology Managers (Socitm) believes councils must fundamentally reweight the amount of money spent on transforming service delivery as opposed to delivery itself.

At the moment, the society estimates most councils spend 90% of their service budgets on operations and 10% on transformation.

It estimates this ratio will need to move closer to 60:40 to prepare for the pressures created by future reductions in funding for local public services.

But in its response to the Operational Efficiency Programme, published by the Treasury alongside the Budget in April, the society casts doubt on councils’ capacity to secure meaningful savings.

“Our managers are ill-equipped to understand, let alone lead, business process improvement, business analysis and a fundamental rethink about what we do and how we do it,” reads the response, which will be published shortly.

“There is a massive training need for middle and top management which will be essential if we are going to achieve the operational budget shift suggested from 10% to 40%.”

Speaking to LGC ahead of Socitm’s conference on 11-13 October, president Steve Palmer claimed savings identified by Martin Read, the former chief executive of outsourcing firm Logica, would be taken for granted by the Treasury.

Mr Read found £4bn could be saved from public sector back-office services, with a further £3.2bn saved from IT costs.

“The issue is that when the Treasury gets these figures they will assume everyone is doing it and take it out of the Budget,” said Mr Palmer, head of ICT at Hillingdon LBC.

“The capacity to do it all quickly is not there. There are issues around scale and lack of ability to pump-prime.”

Socitm’s response claimed many council IT departments were “locked into inflexible and costly outsourced arrangements” while in many areas “ICT is just not professional, disciplined or integrated enough to deliver the levels of efficiency and change that will be required in the future”.

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Readers' comments (2)

  • There is absolutely no evidence that sharing back offices saves money. There have been no proper academic control studies to show that it is the case and plenty to suggest that quality suffers and actually costs increase. The Audit Commission, mostly governed by IT consultancies and those sympathetic to the government line, produced its report without real evidence.

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  • i have tried to find studies that indicate "no evidence that sharing back offices saves money" but have had no luck. How about some web links or titles of "proper academic control studies"?

    let's have that informed debate

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