By Nick Heath, 3 August 2009 15:59
NEWS
After years of resistance to offshoring, the need to slash billions of pounds from public spending could see Whitehall looking to send IT work abroad.
While offshoring is commonplace in the private sector, the public sector has so far shied away from the practice - in part due to wariness of a backlash against sending jobs overseas - even though its supporters insist it can significantly reduce the cost of IT projects.
Indication of a possible shift in public bodies' attitudes to offshoring came last week, however, as the British Council announced that IT jobs could move to India.
It's not the only such hint. Recently, senior civil servants in the Cabinet Office and the Ministry of Justice both told silicon.com that they are open to offshoring work such as software development.
Whitehall already offshores a limited amount of work, including some back office operations under the NHS Shared Business Services Centre run by Steria and the Department of Health. The joint venture provides back office services to more than 100 trusts and offshores about 60 per cent of its work to India.
A more uniform public sector approach to public sector offshoring could soon be on the way, however. Jos Creese, who sits on the government's CIO Council - a group of CIOs from across central and local government that discuss IT issues affecting the public sector - told silicon.com there are plans to strengthen guidance and policy around offshoring "to ensure a more consistent public sector response to the opportunities and risks".
"The matter is important now because of increasing concerns over information assurance, risk, business continuity and data security management," said Creese, who is head of IT for Hampshire County Council.
It is important to properly assess these potential pitfalls, he said, adding that offshoring "is definitely not a panacea".
Central government departments are already considering the offshoring of IT under the Operational Efficiency Programme, the Treasury's drive to cut £7.2bn off central government's annual IT and back office costs, while a report into how much other public sector work should be offshored in the future is currently being developed by the joint industry and government forum, the Strategic Supply Board.
Bangalore, the city that plays home to some of India's biggest outsourcers (Photo credit: Steve Ranger, silicon.com)
Labour MP Tom Watson, who takes a special interest in matters relating to technology and the internet, told silicon.com offshoring can be beneficial for government if done correctly.
"There are potential pitfalls but with the right implementation and sensitive industrial relations, all government departments can make significant efficiency gains," he said.
"All government departments have been asked to make savings in administration costs. There is no doubt that technology, when used right, can not only cut costs but also improve government services to UK citizens."
Steve Palmer, president of public sector IT association Socitm, said public bodies should consider offshoring as one of the many "tools in their armoury" when providing IT services.
"In the current economic climate the public sector is going to be exploring lots of avenues to streamline how it provides services," he said.
"I expect that everybody would look at all the opportunities available given the financial pressures we are going to see."
But Sureyya Cansoy, head of public sector programmes for UK IT trade body Intellect, cautioned there are still many obstacles to offshoring government IT work.
"The economic pressures might well see an increase [in public sector offshoring] but I think there are considerations in addition to cost that the government will take into account, such as the effect on UK employment and the consideration of information security of information handled offshore."
Comments
There are 4 comments. Join the discussion
1. Karen Jones
Whereas I can see the economic argument for offshoring, I do feel that we should be keeping as many jobs as we can within the UK. If cost is such an issue, then why not employ flexible or home working for these IT jobs so that overheads are vastly reduced and we can keep the skills within this country? Our manufacturing and automotive industries have suffered badly in recent years and we rely on overseas operations for so many products now, do we really want to add IT to the list as well? As BT announces it's bringing back call centres form India, surely the public sector is just lagging behind the current increase in nationalistic feeling our country is experiencing?
2. anonymous
Jobs in IT are being lost at a considerable level in the UK. This has been subject of intense debate, however with the Digital Britain report out recently, it signifies that yet again the British economy is to undergo a significant transformation as roles in the service sector evolve. British people will need to look out for the next industry to make significant progress that requires the relevant skills at the affordable cost-base.
3. karen challinor
so according to anonymous
jobs are being lost
the IT industry is dying on it's feet
and anyone in IT should start looking for an industry to replace IT and try to get a job in that sector
so all that IT training and education was basically a waste ?
and still there are no other jobs, no hint of this upcoming new industry to replace IT that we are all supposed to jump ship to
I thought I could be depressing at times but that's a pretty bleak outlook, at least I try and argue to keep the IT industry alive
but back to topic, I fail to see the wisdom of placing the development of possibly key government systems into the hands of foreign powers no matter how cheap the product
at least when we offshore to the US we deal with a system that's at least as paranoid about security as ours is
4. drew stephenson
Daft, absolutely daft. No-one is looking at the holistic cost, they're just looking at trying to balance this year's books.