Socitm's response to the spending review

• Coalition Government's understanding of the potential of IT to reform public services 'encouraging'
• Devolution to local government is opportunity for a paradigm shift in local services delivery powered by ICT
• Significant savings possible from shifting to self service for the public and employees, less regulation and more automation
• Change through ICT means people and process changes - not large cumbersome programmes of the past
• Speed of benefits realisation will be critical. The five year business transformation model is dead
• Significant savings can be made in public sector ICT costs - greater transparency welcome and already operating in local government
• ICT-enabled savings will, however, not materialise if ICT budgets are cut indiscriminately

The Chancellor's CSR announcement of four years' annual 7.1 per cent cuts in council spending and the loss of almost 500,000 public sector jobs confirms (if there were any remaining doubt) that we are at a point of unprecedented cuts in public expenditure and reform.

While the Chancellor made no direct reference in his speech to IT, Socitm is encouraged by the emphasis in other statements and actions by the Coalition Government of its understanding of IT's potential to modernise public services. The Government's intention to devolve more to local public services and local government, in particular, presents an opportunity for a paradigm shift in local services delivery powered by ICT to achieve better, properly co-ordinated outcomes for residents and service users at significantly reduced cost.

Socitm is committed to supporting our members as they seek to lead more intelligent deployment of information and technology to enable the rationalisation, simplification, fairness and transparency of public services required by the Government. Our members will play an important role in developing and implementing integrated and secure systems for place-based budgets and in engaging the public, private and civil society organisations that will be involved in delivering more personalised outcomes for, and with, citizens and other service users.

Evidence from Socitm's own work on 'channel value benchmarking' raises the opportunity for significant savings in shifting from traditional to modern methods of service delivery e.g. self service for the public and employees, less regulation and more automation. Socitm believes that ICT Managers/CIOs across the public sector are key to this and Socitm is playing its part in developing the necessary leadership and professional skills to accelerate the shift.

The potential of ICT to enable service reform and efficiency in government is unlimited. However, we recognise that to deliver change through ICT requires the associated people and processes changes, not via what may have been large cumbersome programmes of the past, automating outdated processes, but through a new pragmatic and practical 80/20 approach, focusing on the essential as opposed to desirable business outcomes.

Speed of benefits realisation and fast return on investment will be critical. The five year business transformation model is dead. Effective portfolio and programme management, sound and determined benefits realisation designed to capture savings, and executive ownership for delivering the outcomes will feature in the new armoury, and to achieve this, Chief Executives will need to bring their IT Managers/CIOs to the table - they must be at the centre of reform and will have some of the answers.

Socitm welcomes the greater transparency of ICT costs and achievements, which it has achieved in local government through its various benchmarking activities. With the demise of the Audit Commission this approach could usefully be spread across all public services.

We do believe that there are significant savings to be made in public sector ICT costs; big government contracts have failed too frequently to deliver value, while overlapping technology infrastructures in different sectors and duplicated projects and poorly managed contracts simply add to the burden. More than ever, Heads of ICT/CIOs will need to deliver more efficiencies in their own operations - sharing knowledge and learning with peers, using networks such as Socitm and working collaboratively with colleagues to join-up ICT infrastructure and services locally.

At a national level, Socitm will continue to work with the Local Government Group, SOLACE, CIPFA, ADASS and other professional associations, Intellect and the private sector to help shape and optimise information and technology infrastructure, standards and security. In particular, we support the intention to create a national Public Sector Network and G-Cloud, provided these are not centrally driven and that they build on the lowest cost existing provision where feasible, which will often be in local government. Socitm also supports the Government's intentions towards open standards. All of these developments will feature in a Local Public Services ICT Strategy, the prospectus for which was recently launched by Socitm.

At the same time, Socitm has a number of concerns:

• the pace of cuts and the effect that this could have on slowing modernisation, particularly if ICT is simply seen as another cost centre to cut;
• our ability to understand the wider 'societal' impacts of the cuts on 'places', on other public services and on local economies;
• the many aspirations (e.g. 'Green ICT')that may get squeezed out in the rush to cut;
• the effect of the pace of change on public services for vulnerable groups - we strongly support the Race Online 2012 initiative, but there has to be public sector capacity to provide essential support and develop content for vulnerable people, and not just achieving physical access to the Internet;
• the development and retention of leadership, business change and technology skills that will needed in the future; and
• the capacity of the ICT industry in an environment of public spending cuts to continue to develop and maintain the innovative solutions upon which a significant part of the savings in public expenditure will be predicated.

Finally, given the scale of the cuts proposed, Socitm urges public sector organisations to avoid the devastating impact of swingeing and narrowly based budget cuts. Rather, this is a time for vision, leadership, medium-long term budget strategies that consider the impacts across 'places', and achieving cost reduction through intelligent deployment of information and technology, collaboration, rationalisation and sharing. Organisations will have to choose between making savings by investing in cheaper channels or cutting the budgets for cheaper channels. We can't have the ICT cake and eat it; we can't have ICT-enabled savings, as well as indiscriminately cutting the ICT budget.

Notes:

The Prospectus For a Local Public Services ICT Strategy is available from this website.
ADASS - Association of Directors of Adult Social Care.
CIPFA - Chartered Institute of Public Finance and Accountancy.
Intellect - The technology trade association.
SOLACE - Society of Local Authority Chief Executives and Senior Managers.