Federal IT Budget To Increase In 2014

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Federal IT spending will increase nearly 2%, to $82 billion, in the fiscal 2014 budget submitted by the White House on Wednesday. It's the first significant increase in federal IT spending in four years.

Federal CIO Steven VanRoekel said in a briefing the increase -- $1.4 billion more than in fiscal 2013 -- reflects the Obama administration's commitment to investing in IT for its ability to have a multiplier effect on government efficiency. Reiterating existing policy, VanRoekel said the Office of Management and Budget wants agencies to invest in more modular and flexible IT systems that can be implemented quickly.

VanRoekel, in a blog post, said the budget will advance OMB's goals of improving services for the public, increasing the return on investment of federal IT and advancing cybersecurity.

[ Is there money to hire younger IT workers? Read Federal Cyber Workforce Is Getting Older. ]

The Department of Veterans Affairs is in line for the biggest jump in IT funding, $722 million, a 22% increase over fiscal 2012, bringing the agency's tech budget to $3.9 billion in fiscal 2014. The increase will go toward the VA's backlog of benefits applications, new relationship management systems and work on integrating health records systems between VA and the Department of Defense.

Other agencies with budget increases of more than $100 million compared to fiscal 2012 include Homeland Security (a $514 million, or 9%, increase), Treasury ($339 million, 9%) and Health and Human Services ($107 million, 1%).

The proposed federal IT budget for fiscal 2014 is $1.7 billion, or 2.1%, higher than it was in fiscal 2012. Compared to the fiscal 2013 budget, as it exists in the form of a continuing resolution, the fiscal 2014 budget represents a $1.4 billion, or 1.8%, increase.

Since fiscal 2009, the federal IT budget has grown at a compound annual rate of 0.78%, which VanRoekel characterized as "flat." A year ago, however, the compound annual growth rate had been running at 0.0004% over three years. The $1.4 billion in extra spending, compared to fiscal 2012, pushed CAGR into the positive.

The agencies facing the biggest IT budget cuts compared to fiscal 2012 are the Department of Justice (a $96 million, or 4%, reduction) and Housing and Urban Development (a $59 million, or 13%, decrease).

The proposed federal IT budget devotes more than $13 billion to cybersecurity programs, including $300 million in new funding for the continuous monitoring of federal networks, $85 million for trusted identities in cyberspace and related research, and $79 million toward improving incident response.

OMB is also investing in what VanRoekel calls "evidence-based policy," which involves the use of best practices to determine what works in government services and make funding decisions accordingly. "We've asked to get some modest funding to start to centralize some of this," he said.

The feds have tallied $2.53 billion in potential savings, to be realized from fiscal 2013 to fiscal 2015, through IT consolidation and elimination of "low value" investments, as part of OBM's PortfolioStat program, VanRoekel said. The next version of the program, PortfolioStat 2.0, aimes to integrate data center consolidation and IT portfolio management.