Government solution providers will have a few more dollars to compete for in 2007 if President Bush's proposed budget for $64.3 billion is approved by Congress. The slight increase will mostly benefit civil agencies, with the Defense Department's budget remaining flat.
President Bush proposed an IT budget of $30.5 billion for the Department of Defense, compared to the $30.4 enacted in fiscal year 2006; for civil agencies, he proposed $33.7, compared to $32 billion last year. Not surprisingly, most of the additional dollars were allocated to the Department of Homeland Security, with a proposed budget increase of $772 million compared to last year. Among the agencies that saw a decrease in proposed budget allocation compared to last year were the Department of Treasury and NASA.
"The government recognizes that using technology is not a discretionary line item; it's mandatory for the proper functioning of the government," says Rick Marcotte, president and CEO of Herndon, Va.-based DLT Solutions. "And I think they're right. Really, any government agency, regardless of size, that isn't using technology to better serve constituents is missing the boat."
In addition to defense and security priorities, Bush did mention public-school reform via an American Competitiveness Initiative, which "targets funding to advance technology, better prepare American children in math and science, develop and train a high-tech workforce, and further strengthen the environment for private-sector innovation and entrepreneurship."
That said, the initiative doesn't translate to additional dollars; the proposed IT budget actually decreased the amount allocated to the Department of Education from $407 million to $403 million.
Overall, President Bush proposed a $2.7 trillion budget, with a decrease in spending on Medicare of $36 billion during the next five years, a hold of overall discretionary spending below the rate of inflation and a cut in spending on nonsecurity discretionary programs below 2006 levels. The administration identified 141 programs that should be terminated or significantly reduced in size.
"Just because the President requests a [certain amount in the budget] doesn't mean it will be approved," says Stan Collender, managing director of financial advisory firm Financial Dynamics at the Coalition for Government Procurement's Winter Seminar. "The average member of Congress can't see or touch [technology]. If [they] have a choice of throwing money at IT or at something where a ribbon can be cut, it's a no brainer."