White House: IT Reform Will Save Government $2.5B

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White House efforts to root out wasteful IT spending in federal government have identified 98 "opportunities" for consolidation, with potential savings of $2.5 billion over the next three years.

Jeffrey Zients, deputy director for management at the Office of Management and Budget, on Wednesday gave a progress report on the federal PortfolioStat program, launched in April with a goal of identifying duplicative and unnecessary IT spending.

Agencies were required to conduct an accounting of their IT systems and assets in 13 areas and identify those that are "commodity" in nature. Agencies then developed action plans for consolidation, which were reviewed in meetings with federal CIO Steven VanRoekel.

"OMB worked with agencies to review their data and compare their spending to other agencies and private sector benchmarks in order to assess the agency's current state and develop a list of opportunities to reduce inefficiency, duplication, and unnecessary spending," Zients wrote.

[ Get background: White House's New Attack On IT Spending Waste. ]

The Department of Homeland Security identified $376 million in savings to be gained by purchasing some IT infrastructure, including mainframes and servers, in bulk. Likewise, the Social Security Administration estimates it can save $59 million through an agency-wide purchasing program.

The Treasury Department plans to consolidate financial management systems, at a projected savings of $90 million, and create a central hub for vendor payment information. Elsewhere, savings are expected to come from consolidating email systems and reducing duplicative contracts for desktop or mobile services, Zients wrote.

Some of the $2.5 billion identified by OMB can be described as cost avoidance, while other savings will come through cost elimination. That's in addition to $4 billion in cost avoidance and elimination chalked up to TechStat, the federal program introduced in December 2010 to identify at-risk IT projects and take corrective action.

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