Yet again the government has wasted £107 million on failed IT projects over a 12 month period. With the biggest loss by the Ministry of Justice who spent £56.3 million on a system designed to save costs on admin tasks such as HR and payroll but decided to outsource to the company that set up the system in the first place. Authorities in government, councils, the civil service, health boards ETC seem to believe that the cheapest is best and don't seem to have heard of that old adage you get what you pay for. In the real world this is usually true and it is necessary to pay the extra and get something fit for purpose and reliable. But these people seem to think that wasting money is OK as there is never ever any come back for the many failed decisions made each and every year. On a personal note through a Freedom of Information request I discovered my own health board has wasted millions on a failed IT system that no one could use,which could not talk to the many other systems installed thought the NHS hospitals covered by my board. Another request discovered that hundreds of thousands of pounds had been spent on over priced consumables such as toner,printer ink, DVD'CD's ETC.
Public Sector often has no choice on the cheapest option due to the massive budget cuts that are being forced on them by the present government. Often there just simply isn't money available for the (expensive) fully-featured option that might be best suited. For something of this scale/cost they have to go out to tender, this process is strictly assessed so that there is no basis or preferential treatment towards one supplier over another. So long as the options meet the tender requirements, cost is often then deciding factor over which wins the tender. In the MoJ case, the cost of outsourcing the system will have been cheaper than running it in-house, it's likely that the implementation of the system was planned before budget cuts were known and that by outsourcing it they have met part of the savings they need to make. It's not just public sector that hand over huge expensive projects to outsourcing companies, you just don't hear about it with most private companies. Aviva for example built an entire new datacentre full of kit then outsourced it: http://www.computerworlduk.com/news...-in-700m-datacentre-management-deal-with-eds/
Incompetence and a complete inability to think ahead, something which afflicts all aspects of government in the UK.
You are obviously speaking on behalf of the government and the above would be valid if this wastage was happening because of the current government budget cuts. But where it totally fails is that this wasting of public money has always occurred. It should not be difficult to find examples of massive over budget or IT failures long before the countries current difficulties. I believe it has more to do with this: Firstly, that the tendering process always causes a race to the bottom, with the lowest cost bidder normally winning. Secondly, they are the lowest bidder because they make claims about what they can achieve for very little but are not realistic about how much this will actually cost. Thirdly, that staff in government often have no clue about how these systems work and therefore fall for the claims. And fourthly, because this has gone on for so many years and therefore the new systems are building on old systems which never worked in the first place. This makes it more difficult to make something which actually works, lowers the expectations of staff who are used to having a system which doesn't work properly and means that the system has to be more complex to accommodate the old system. But back to my personal experience concerning the IT system installed in the hospitals in my health board. I came to notice that things were wrong when suffering from a long term and serious condition I was asked a fair way into my treatment what painkilling drugs had I been prescribed by Dr's in the previous nine months of treatment. I pointed out surely this should have been recorded as and when I was prescribed the drugs. And yes it should have been but the newly installed system was a mess with frequent crashes and errors that people had given up on it and had returned to paper record. This fiasco had nothing to do with budget cuts but more to do with false economic reasons.
Although much of what Atomic said is true, it is much more ingrained than the recent budget cuts. The issues with public procurement are many (not that the commercial sector is perfect). One of the main contributing factors is that it is public funds being used, so every penny is scrutinised closely to ensure that it's not being wasted. that may seem at odds with contracts often being overspent, but it does in fact follow: Procurement is under great pressure (more so now with the budget cuts) to ensure funds are not wasted on something too expensive, and large contracts especially come under the microscope. This need to be accountable for funds available now (rather than years in the future) channels decisions towards the cheapest option at the moment, even though there may be options which promise far less total cost through life. After all, those options can be audited and proven, TCO (Total Cost of Ownership) can only be calculated and may or may not turn out to be savings. The budget cuts have only highlighted and strengthened this tendency, departments need to make savings now. Years ago most procurement departments only gave a slight thought to TCO, and followed the old style of hammering the supplier for the lowest up front price. This has been gradually changing (public bodies have been much slower, but have grown a bit smarter). Unfortunately the austerity measures have set the culture change back a few years. All this then drives the suppliers/subcontractors to submit the lowest price for sometimes basic solutions with lots of exclusions (which will be added on later for additional cost and profit). One thing that hasn't changed, and doesn't look like it will soon, is the change and meddling of Government bodies between tender and implementation. This only increases complexity and cost, and all to often ends up with an unworkable or very expensive requirement. The issues are certainly not isolated to IT sector contracts.
There is no business motivation in government workers succeeding at any level. There is no competition outside of the role of a politician. There's no drive then to succeed.
It's more complicated than that. It basically comes down to accountability. In the NHS for instance you can't just buy something; you have to order it through approved suppliers, which have been vetted to supply equipment of a required standard. This makes good sense for life-critical medical equipment, but not for office supplies. And because of this closed market there is little competition and they can basically name their price. Complex invoicing processes mean it is nearly impossible to return items that turn out to be unsatisfactory. The people in charge of ordering office supplies generally have no expertise with regards the item being ordered. Matrons order office furniture; medical secretaries order computer equipment. Operations managers procure software. These people will agonise over what staplers to buy for £5,--, but will happily sign off a £1 million IT project or building within minutes because frankly they understand staplers a lot better than IT projects or buildings. Save money, by the way, and it will be cut from your budget the next year. So departments will not order anything that you really need all year "because we have a limited budget", only to go on a crazy spending spree in March to use up all the money it hasn't spent yet before it's taken away. Luckily most departments now keep a wish list throughout the year which allows them to make sensible purchases when March comes around.
