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By | Kat Hall 27th May 2015 10:22

SME IT contracts? That's the last thing Whitehall wants – report

We also lack procurement skills, say central govt departments

Government departments are unenthusiastic about funneling more of their IT biz through SMEs, according to a survey of nearly 1,000 central government IT bods.

Only 20 per cent said there is an appetite within their department to procure a higher percentage of technology services from SMEs, found the research from IT trade body TechUK.

That could be related to the fact that only 21 per cent said their departments have the appropriate skills and capabilities to "effectively manage IT supplier contracts and relations".

Currently, just 17 per cent admit to having a wide range of IT suppliers, including SMEs.

However, the survey findings are not aligned with the Cabinet Office's commitment to disaggregate its mega IT contracts and hand more biz to SMEs.

Lack of skills also presents a particular challenge for departments tasked with moving away from the "one throat to choke" big supplier model to co-ordinating and managing a large number of SMEs instead.

Many of these big contracts are starting to come to an end, such as HMRC's £10.4bn Aspire contract – which the National Audit Office has warned could be too risky to change by 2017.

But the difficulty is that many of these contracts are all coming to an end at once, leaving the government with little time to improve its IT procurement and supplier management skills.

One source told us this is being solved through the back door by extending those contracts: "I doubt it’s being talked about, but look at all the contracts that are supposed to have ended or that will be ending and see how seemingly they all have another year (or two) to go – to give people time to phase out," he said.

That is exactly what the Department for Work and Pensions did earlier this year by extending its contract with HP with for another three years.

According to TechUK's survey, only 20 per cent rated their IT procurement skills as "good". ®

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