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2/16/2011
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Federal IT Budget Reflects Strategic Cuts, Innovation Investment

Federal CIO Vivek Kundra says government will slash IT budgets where projects aren't working, while spending more on innovation.

The President's fiscal 2012 IT budget focuses on cutting what the government can't afford while still investing in game-changing technologies, federal CIO Vivek Kundra said today on a call with reporters.

Overall, the federal IT budget will go up by 1.3% to $79.5 billion, but that represents relatively flat spending compared to IT budget increases under the Bush administration.

On one hand, the budget begins a multi-year shift toward eliminating more than 800 federal data centers and eventually moving as much as $20 billion in IT spending to the cloud via data center consolidation and a cloud-first budgeting policy. It also reflects savings from rigorous statistics-based IT project reviews put in place last year. On the other hand, the government is spending significantly more money this year on cybersecurity and certain special projects like the FAA's NextGen air traffic control system.

While cloud computing is called out mostly in general terms in the President's budget and agencies' budgets, Kundra noted that cloud savings could be substantial, adding that the General Services Administration and Department of Agriculture would each save millions by moving to cloud email and collaboration services.

As part of the recently-released federal cloud strategy, agencies have committed to moving 72 total services to the cloud, Kundra said. He predicted that agencies' collaboration services will move to the cloud first, followed by workflow, infrastructure, business intelligence, and even security management.

While the data center consolidation initiative aims to cut the number of federal data centers by about 40%, Kundra's long-term "end game" for data center consolidation is much more ambitious -- it would be to have three major federal data centers across the country, which he calls "digital Fort Knoxes." "We're not going to get there in a year, but we have to take steps," he said. "The 800 you see today is just a minimum."

If the President's budget is passed, cybersecurity spending will be up at many agencies, most notably at the Department of Defense and the Department of Homeland Security, which are tasked with securing military and civilian networks, respectively. "The threat to cybersecurity is grave, and it's real," Kundra said. "We're much more focused now on investing in continuous monitoring tools and red teaming."

Kundra said that, in addition to the overall theme of the President's IT budget, he foresaw three major technology trends driving federal IT over the next year: the descent of the PC as employees' central nexus with IT, the rise of employee-owned computers and devices (even within government), and a continued shift toward lighter-weight and cheaper IT tools and services.

The federal CIO also broke down a number of increases and decreases in agency budgets. For example, he noted that a 12% increase in IT funding for the Department of Transportation is attributable mostly to NextGen, while a 6% Department of Agriculture increase comes from IT modernization. At the other end of the spectrum, a 24% decrease in NASA's IT budget is largely reflective of decreases in infrastructure spending, while a 33% decrease in the Office of Personnel Management comes from a reduction in financial systems modernization spending.

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