Half of government’s £5bn annual IT spend dedicated to ‘keeping the lights on’ legacy tech

Report also cites an “under-developed level of digital expertise in civil service, a failure to use data and a lack of confidence in GDS”

Posted 29 July 2021 by Christine Horton

Almost half of current government IT spend is dedicated to “keeping the lights on” on outdated legacy systems, according to a government-commissioned report.

The recently-published report, Organising for Digital Delivery, from the Digital Economy Council found that, in 2019, government faced cumulative annual costs of £2.3bn to maintain legacy IT. This represents almost half of the £4.7bn in total that was spent on IT across government that year.

The study goes on to report that some departmental services fail to meet even the minimum cybersecurity standards, and the inability to extract usable data from these legacy systems has been identified as one of the greatest barriers to process transformation and innovations across government.

By way of example, the Home Office – the government department with the largest single technology spend – has not been able to retire any of their twelve large operational legacy systems.

The findings are being taken forward by the new Central Digital and Data Office (CDDO) and the Modernisation & Reform Team in the Cabinet Office.

“Our investigations suggest that many government departments are investing significant sums in collecting and storing often very large datasets but making little use of this data to influence action of decision making,” noted the report.

As one senior external hire put it, “My biggest surprise when I arrived was how little we do with our data.”

Lack of digital expertise

Among many criticisms, the study noted “a general concern around the relatively under-developed level of digital expertise amongst senior Civil Service leadership.

“This contrasts with the emerging position in the commercial world in which technology is increasingly seen as a critical delivery lever (alongside people and money) and where it is becoming increasingly expected that senior leaders have a clear understanding of how to deploy technology effectively as an organisational lever. At a minimum leaders should be capable of auditing effectively the performance of their digital functions, including having a realistic expectation of how long projects should take, what they should cost, and what questions to ask in order to assess whether delivery is on or off-track.”

Last week a separate report by the National Audit Office (NAO) said that the government continues to show a consistent pattern of underperformance when it comes to delivering digital business change.

GDS “lost its way”

Elsewhere, the report highlighted the migration of policy responsibility for data to DCMS in 2018, and a move away from central support as individual departments have developed their own capabilities.

It said has, “raised a concern that GDS [The Government Digital Service] has to some extent ‘lost its way’ and would benefit from a refocusing around its central mission. When McKinsey surveyed permanent secretaries about the role of the centre in late 2018 they found that, of all the centrally operated functions, departments had least confidence in GDS.”


The report makes eight recommendations to address these challenges “and give the UK the best chance of delivering on its ambition to make UK government digital services the best in the world.” In brief, these are:

  • Build mechanisms to put the citizen at the heart of all design decisions
  • Strengthen the accountability of departments and their Permanent Secretaries 3. Hire a Permanent Secretary level head of function
  • Re-focus and add teeth to the centre
  • Create clear investment swim lanes to address the legacy debt
  • Set up a quarterly business review process
  • Invest in developing the technical fluency of senior civil service leadership 8. Create a Government data application centre of excellence