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2/13/2012
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Obama's Budget Cuts Federal IT Spending

President's fiscal 2013 budget proposal reduces federal IT spending by 1.2%, all of it attributable to cuts in military IT.

Federal Data Center Consolidation Makes Progres
Federal Data Center Consolidation Makes Progress
(click image for larger view and for slideshow)
President Obama's proposed fiscal 2013 budget would decrease federal spending on information technology by 1.2% from $79.8 billion to $78.9 billion thanks to cuts in military IT spending, according to budget documents released Monday.

Department of Defense IT spending will decrease from $38.6 billion in fiscal 2012 to $37.2 billion next year. Military officials had been indicating for months that their IT budgets would likely be subject to cuts. A presentation that federal CIO Steven VanRoekel cited during a conference call with reporters Monday indicated that as much as $300 million in military IT savings could come from data center consolidation alone.

Aside from military IT spending, all other federal IT spending will actually slightly increase, from $41.2 billion to $41.7 billion. However, while the Obama administration has been known as a tech-savvy administration for hiring the nation's first federal CIO and CTO, spending on IT has been essentially flat since Obama took office, while it increased about 7.1% annually under the Bush administration.

VanRoekel characterized the administration as "proud" of this flat spending. "I would contend that [despite the cuts], we've innovated more in the last four years than at any point in the decade before," he said.

[ How can taxpayers know whether they are getting their money's worth from government IT? See Federal IT Needs A Cost-Savings Dashboard. ]

Many of those savings can likely be attributed to more efficient use of IT by government agencies, which is a trend that the fiscal 2013 federal IT budget appears to aim to continue. The budget stresses numerous efforts to "maximize return on investment" for federal IT spending through the use of technologies and strategies such as cloud computing, data center consolidation, and IT management oversight.

The budget document indicates a number of top priorities for federal IT, all of which align with federal CIO Steven VanRoekel's public comments over the last few months. Those priorities include, in addition to maximizing ROI, closing the perceived productivity gap between public and private sector workers, improving government interaction with business and citizens, and cybersecurity and privacy.

The budget hints at a number of IT policies that will be forthcoming from the White House in coming months. According to the budget, the Office of Management and Budget will issue an official shared IT services strategy to detail how agencies should pool agency purchasing power and capitalize on shared services, guidance promoting the use of agile and modular development and contracting processes, and a mobility strategy.

One of the most prominent pieces of the fiscal 2013 federal budget plans is cybersecurity. The budget calls for $769 million for the Department of Homeland Security's National Cybersecurity Division to build out Einstein intrusion protection and prevention systems, improve continuous monitoring, and take other steps to bolster the nation's cybersecurity. That represents an increase of more than $200 million. The National Science Foundation would also receive $216 million on two cyber research and development projects. Cybersecurity factors heavily into intelligence and military budgets as well.

Cloud computing also plays a strong role in the federal IT budget. The administration notes that federal agencies have moved or will move 79 services to the cloud by June 2012. Some of these migrations have saved agencies millions of dollars. The Department of Agriculture, for example, estimates that it will save $27 million over five years by moving to cloud services. The budget also estimates that shared security authorization service FedRAMP will reduce by 30% to 40% the costs associated with authorizing and continuously monitoring cloud services.

In addition to the continued commitment to cloud computing, the Obama Administration's fiscal 2013 budget indicates continuing support for a number of priorities that began under VanRoekel's predecessor, Vivek Kundra. The budget calls Kundra's 25-point plan for improving federal IT the "cornerstone" to the administration's IT strategy. On the docket for fiscal 2013 include an upgrade to the federal IT Dashboard (a website that tracks federal IT spending), more data center consolidation, and the re-invigorated use of TechStat accountability sessions to tackle problems in high-risk IT projects.

How 10 federal agencies are tapping the power of cloud computing--without compromising security. Also in the new, all-digital InformationWeek Government supplement: To judge the success of the OMB's IT reform efforts, we need concrete numbers on cost savings and returns. Download our Cloud In Action issue of InformationWeek Government now. (Free registration required.)

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