Perverse Policy: UK Govt. CIO Loses Clout If He Spends Less - InformationWeek
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2/9/2010
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Bob Evans
Bob Evans
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Perverse Policy: UK Govt. CIO Loses Clout If He Spends Less

Calling it "one of the most perverse things I have heard," the CIO of the U.K.'s Revenue and Customs branch said he was warned by Cabinet officials that if he were to find creative ways to cut his $1.2 billion IT budget by 50%, he would be dropped from a top-level group that shapes government purchasing policy and strategy.

Calling it "one of the most perverse things I have heard," the CIO of the U.K.'s Revenue and Customs branch said he was warned by Cabinet officials that if he were to find creative ways to cut his $1.2 billion IT budget by 50%, he would be dropped from a top-level group that shapes government purchasing policy and strategy.In a stunning portrayal of undisciplined IT spending based solely on a desire to retain maximum leverage via ever-increasing spending, a ComputerWeekly.com article offers a sobering look at what can happen when IT priorities are managed by out-of-touch bureaucrats with no sense of delivering value to stakeholders.

Phil Pavitt, CIO at HM Revenue and Customs (HMRC)-which has the third biggest annual IT budget among central departments, at about £800m-said he was visited by leading officials at the Cabinet Office soon after he was appointed in September 2009.

"In that conversation with me they mentioned I am in the top purchasing club. . . . That means you have tremendous influence on buying power, buying ideas and management and so on.

"I said, 'If I reduce costs by 50%, what happens?' 'You leave the club,' I was told.

"So here I am, relieved of my ability to influence government's ability to purchase if I am clever and do my job. It is one of the most perverse things that I have heard."

Asked by ComputerWeekly.com for a comment on Pavitt's contention, a Revenue and Customs spokesman did not dispute it and attempted to spin it with comments like this one: "The bigger your budget, the more leverage you have, but HMRC is not driven by this consideration."

The article also offers some powerful comments from a CIO consultant in the UK who's worked at major firms in the private sector:

Chris Goodall, a director of consultancy Five One Two, who has worked at IBM, UBS and Citigroup, said: "Government CIOs should be rewarded and recognised for breaking away from this old school club. I think this is a fairly typical example of bloated IT costs which government ministers have been encouraged to pay for years. The tender process is not delivering best value for money in terms of pound notes and, as Pavitt revealed, they are not incentivised to do so either.

"The message looks to be that government should go with the highest bidder, regardless of the quality of what is being delivered or what skills and innovations a smaller-and cheaper-provider could offer," he said.

I hope Pavitt's bold disclosure wins him support from his fellow public-sector CIOs in the U.K. rather than leading to a desk near the men's room and a permanent assignment to the PC Help Desk. While it's hard to imagine that such courageous honesty will play well in the type of detached and delusional Whitehall culture that the article portrays, we can hope that today's challenging economic conditions will allow Pavitt's challenge to this truly perverse policy to remain in light and lead to substantive change rather than be buried by bureaucratic BS.

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