Offshoring IT in the public sector

Although offshoring public sector services has been a fringe issue, it has the potential to be divisive, and in an IT context it polarises opinions, especially in the aftermath of Service Birmingham's U-turn on its plans to transfer jobs to India. The discussion tends to take two directions, something Jenni Viitanen, a research fellow at the Institute for Public Policy Research North, identified in GGC's live online debate on the issue. Either offshoring becomes solely about the numbers, the potential for cost savings and the need to secure value for money, or it is viewed in emotive terms of job losses and the disintegration of the UK's skill base. Where you stand inevitably depends on your place in the IT procurement food chain, and there are certainly IT workers within local and central government who fear the demand for savings will become the crucial factor. In fact, there is an argument that value for money is as much about competencies in the public sector as reduced labour costs. There is a value in public authorities retaining skilled staff who contribute to society through income tax and national insurance, and hold a deeper knowledge of the problems and issues in that sector. Viitanen said that deciding whether to offshore has to feed into a broader concept of public value , which incorporates democracy and inclusion, not simply monetary transactions between the state and service providers. Skills also feed into debate because poorly managed projects and a lack of strategic skills often contribute to the decision to offshore. It is something the Cabinet Office raised concerns about in its offshore guidance, suggesting that supplier management was a potential pitfall. Better training might provide some clarity and drive to an organisation's IT agenda, but right now the public sector is a long way away from that point. Consultant Colin Cram said the move towards offshore will always come down to numbers. This is because suppliers require a cost base significantly lower than the existing public sector level to enable government to make savings. While this seems more likely in a climate governed by cuts, but any decision to offshore could have a negative effect in the polls. Editor of GGC, Mark Say, remarked that any stories in the press about public sector jobs being farmed out overseas would have the potential to do a lot of damage to an administration and this provides a reason to be cautious. Among the other points to emerge was the prohibitive nature of legacy landscapes, which pose an obstacle to any public sector organisation wanting to offshore. Katherine Wheatley, consultant at FutureGov, commented that replatforming and integrating countless client-server applications and datasets have huge cost implications which few organisations can afford. The consensus was that, although agile system development might have an impact in this area in five years' time, the immediate future of government IT remaines with large legacy systems. Data security was also flagged up as a real area of concern. One comment from outside the panel suggested that data breaches, with the legal implications and the potential to damage confidence in a service, is the biggest worry for councils. Another remarked that no amount of security could protect data if someone wished to abuse it. The prevailing feeling was that any hint of jeopardising data security was a risk too large to take. Overall, it was assumed that offshoring could work in the right economic context but, as Mohamed Hans of the Chartered Institute of Public Finance and Accountancy noted , a stagnant economy and increasing youth unemployment made it a risk in the UK at the moment. But a combination of strong staff selection, due diligence and an effectively managed relationship with the outsoucer could still make offshoring a worthwhile option. A full record of the debate can be found here . This article is published by Guardian Professional. For weekly updates of news, debate and best practice on public sector IT, join the Government Computing Network here .