Government's £23b tech spend a "black box" due to poor oversight

Short-term spending is leading to spiralling tech debt

The UK government's annual investment in digital technology is riddled with oversight issues, a former official has said.

A parliamentary committee recently heard that the government struggles to track how its £23 billion annual digital budget is spent, due to fragmented procurement processes and inconsistent mapping.

As reported by The Register, Joe Hill – a former Treasury and Home Office official who now serves as policy director at the Reform think tank – has told a committee of MPs that the government has repeatedly failed to get a proper handle on its digital spending plans.

Hill noted that digital spending is a vast area, which lacks proper tracking and has been inconsistent over time.

"Every few years someone realises, 'We don’t really know how much we’re spending on digital,' and decides to try again," he said, highlighting the lack of a clear tracking of these expenses.

Hill also criticised procurement processes, which he said inflate costs and cause delays, often leaving projects outdated before completion. He stressed that without long-term investment, many departments will remain reliant on ageing systems that are costly to maintain and update.

The challenges go beyond budget tracking. HM Treasury's review of digital spend, published last month, found that departments often favour short-term savings over long-term investments in technology. This focus on immediate cost reductions has led to outdated systems and growing technical debt, with little effort to maintain existing systems.

The review also pointed to the lack of agreed metrics to measure the success of digital projects, limiting the ability to assess value for money.

Calls grow for overhaul

Hill is not the only voice clamouring for an overhaul of the UK’s digital spend. Early this year, the National Audit Office (NAO) issued a report that echoed similar concerns, urging the government to make real changes in its tech procurement strategy.

The NAO claimed poor procurement planning cost the government an extra £3 billion, which was needed to either restart failing projects or keep legacy systems running for longer than expected.

The NAO report pointed to a generalist approach within procurement teams, which is ill-suited to the complexities of modern digital projects. The report criticised the government for over-relying on Big Tech firms for cloud services and AI, while also revealing a skill shortage in digital procurement expertise.

Consequently, the NAO has called for a more strategic, cross-departmental approach to sourcing, improved data sharing, and an increase in digital expertise to avoid wasting taxpayer money.

Without these systemic changes, the government risks continuing down a path of inefficiency and missed opportunities in digital transformation.