Local government and the NHS do not want outsourced IT, studies find

Written by PublicTechnology staff on 2 August 2018 in News
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Research from Dods shows that most public sector workers are not in favour of bringing in commercial firms to provide their IT

Credit: Alpha Stock Images/Nick Youngson/CC BY-SA 3.0

Most workers in the NHS and local government do not want their organisation’s IT delivered by private sector firms, research has found.

Two new reports from PublicTechnology parent company Dods – examining attitudes to all forms of outsourcing across the NHS and the local government sector, respectively – found that, in general, public sector employees do not support the use of outsourced IT provision.

When asked whether private-sector companies should be involved in the delivery of their organisation’s IT, just 44% of respondents in the local government sector agreed that they should.

In the NHS, support for commercial firms’ involvement in providing IT services stood at only 43%. 

A debate about the role played by IT services in the local authority and health sectors would mirror the discussions that have taken place across central government for some years.


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Since the coalition government first came to power in 2010, many monolithic contracts with technology firms have been broken up, with some services taken back in house, and others farmed out across a more diverse range of suppliers via procurement vehicles such as the G-Cloud frameworks.

Big-ticket deals that are in the process of being taken apart include Defra’s £1.5bn 14-year relationship with IBM, the disaggregation of which is happening alongside that of a similar engagement between the Environment Agency and Capgemini. The biggest Whitehall IT contract of all – HMRC’s Aspire deal with Capgemini and Fujitsu – is due to finally reach its conclusion in 2020.

Between now and then, the department is migrating services from the two tech giants to an estimated total of 200 suppliers – as well as insourcing some services.

The collapse of Carillion has brought the subject of the rights of wrongs of outsourcing into even sharper focus. In light of the company hitting the wall, Cabinet Office minister David Lidington announced the government would adapt its procurement rules to ensure that the “social value” is assessed during the evaluation process. 

Shortly after Carillion went under another major government supplier, Capita, issued a profit warning – prompting a response from the government and a statement in the House of Commons from implementation minister Oliver Dowden, providing reassurance that the company was not in similar peril to its fallen rival. Nevertheless, Capita’s half-year results released this week showed a 59% year-on-year drop in pre-tax profits, occasioning a sharp drop in the firm’s share price.

 

To read the full Local Government Outsourcing Report and Health: Outsourcing Report – each of which includes lots of exclusive in-depth insight into public sector sentiment towards suppliers, the appetite for insourcing, and the effect of the Carillion collapse – please click here to visit the Dods Shop. The reports cover public-sector attitudes in a range of outsourcing areas, including IT, major projects, and frontline services, as well as examining respondents’ views on their organisations’ skill levels and the potential impact of Brexit.

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