Source www.vnunet.com
By Karl Flinders
vnunet
15-12-2003
The channel could be in line for a huge cash bonanza, with local authorities set to increase IT spending by £500m next year as they accelerate towards e-government targets.
The prediction of a 25 per cent increase comes in the latest IT Trends survey by the Society of Information Technology Management (Socitm). The rise will take the local authority IT spend to £2.5bn next year.
Gordon Davies, commercial director at reseller Compusys, said the figures are a good measure of IT spend in local government.
"If Socitm is saying this it is probably accurate because the organisation is close to this market," he said.
John Serle, IT Trends editor at Socitm, said a recognition of improved business processes through IT, as well as the race to meet e-government targets are the reasons for the increase.
"A broad range of technology areas will be invested in, including infrastructures, software and consultancy. The biggest investments will be in applications such as CRM and supply chain management software," he said.
Serle added that third-party suppliers are essential. "Councils will continue to use service providers and resellers because they are under pressure to meet deadlines," he said.
But he warned that the spending is not infinite and councils will have to show improvements to services. "If it works it will go on until 2006, and then the government will be looking for pay-back," he said.
Many industry observers believe the public sector has been propping up the IT sector over the past two years.
Annie Rickard, marketing manager at reseller TriSys, said: "Local government is one of the key places to be. People in local government like to be up with the latest technology.
"Funding might slow down after 2005, but there will be ongoing support and maintenance contracts." |