The announcement marks a major extension of the remit of the GDS, which has focused solely on central government departments.

The Treasury said that the government’s digital ambition will now extend beyond Whitehall and arms-length bodies to consider local services.

The Budget report said: “HM Treasury, the Department for Communities and Local Government and the Government Digital Service will collaborate with partners in local government, as the sector develops a set of proposals that will enable more customer-focussed, digitally-enabled and efficient local services in time to inform future budget allocations.”

Julian David, chief executive of supplier representative body TechUK said: "Today’s announcement has put further momentum behind the digitalisation of public services, both at a central and local level.

"This will be vital for meeting the chancellor’s targets for efficiency savings as well as building world-class public services around the needs of the citizen.”

There was no extra detail on the announcement in the Budget documents, and no extra money for GDS was specifically mentioned in the Budget costings.

Last year, in an interview with Civil Service World, the government’s executive director of digital, Mike Bracken, who runs GDS, said he does not currently have the capacity to respond to calls from some quarters for the GDS to work more with councils.

Despite its central government remit, GDS until now has helped local government with a handful of projects, including a prototype performance dashboards produced in collaboration with Solihull Metropolitan Borough Council.

Yesterday, HM Government deputy chief technology officer Magnus Falk told the Public Sector ICT conference that Whitehall digital officials are preparing and testing plans for the next stage of government as a platform (GaaP) for May's incoming government to consider.

Siobhan Coughlan, programme manager as part of productivity team at the Local Government Association, said the government should consult councils on these plans.

Elsewhere in this year’s Budget, the government announced that it will invest £11m into entrepreneur hubs in Manchester, Leeds and Sheffield.

It will also launch two pilots in Leeds City Region and Greater Manchester to trial local sharing initiatives covering shared transport, shared public space and health and social care. 

View more sector reaction including from LGA and Labour Party