Cabinet Secretary Francis Maude is meeting with a list of big IT suppliers as he promises to make tighter spending controls permanent and threatens not to tolerate poor performance.
Maude is set to meet with 20 of the firms which have traditionally landed the large government IT contracts to discuss the next steps in efficiency savings.
Maude is keen to be seen as cracking the whip over costs, and said that those which do not play by the new spendthift rules of public sector procurement will get the boot.
“I want Whitehall procurement to become as sharp as the best businesses,” Maude said in a statement. “Today, I will tell companies that we won’t tolerate poor performance and that to work with us you will have to offer the best value for money.”
Clearly Maude wants to put an end to the long list of high profile public debacles, such as the NHS cock-up which Computer Sciences Corporation presided over.
Since the Coalition was elected there has been an attempt to reduce enormous IT spending, and the Cabinet Office has claimed that £3.75 billion worth of savings were made in 2011/12. This figure is expected to top £5 billion this year.
This has also meant opening the door for smaller firms to tender for work, to break the cycle of lengthy and costly contracts being handed to the big name supplier cartel.
The government has been derided by select committees and industry experts over the lack of expertise in negotiating contracts.
Such steps show a willingness to at least attempt to learn from harsh lessons in the past. But can we finally expect to see the government become an ‘intelligent’ customer – as one MP recently put it?
Microsoft and SAP have already had £65 million and £3 million contract reductions negotiated this week, so it does seem that the government means business. How far the government is willing to push austerity onto big business global contractors will be interesting.
With endemic problems in the way Whitehall has procured IT before, there is plenty of work to be done before the government can really claim to be the efficient “business” that it aims to be.