Suppliers “outraged” by accusation of govt IT collusion

Members of the IT trade body Intellect are "outraged" by the suggestion, made in a new report on government IT, that a "cartel" of suppliers is colluding to inflate the price of public sector IT work.

Having quizzed various government IT stakeholders, the Public Administration Select Committee wrote in the report that it "found that government is currently over-reliant on a small ‘oligopoly’ of large suppliers, which some witnesses referred to as a ‘cartel’".

It recommended that "the government should urgently commission an independent, external investigation to determine whether there is substance to these serious allegations of anti-competitive behaviour and collusion."

Speaking to Information Age this morning, Intellect’s director general John Higgins said that had spoken to few members about the report, and that they were "outraged" by the suggestion of collusion.

"I’ve worked in and for this industry for 35 years, and I am completely convinced this collusion does not exist," Higgins remarked.

Higgins said that although contained a number of sensible recommendations, such as making the government IT procurement process simpler to allow more suppliers to pitch for business, "we don’t think that its helpful to talk about anti-competitive behaviour".

One of the report’s claims is that a lack of IT expenditure benchmarks across government departments has "enabled large systems integrators to charge between seven to 10 times more than their standard commercial costs".

"That doesn’t sound realistic," said Higgins.

The report is the latest in a number of indictments of IT management by the UK government, but one of the most damning. It quotes sources as saying that on over-reliance on external suppliers is ‘a recipe for rip-offs’.

It includes some interesting observations about the nature of government IT, as compared to private sector computing.

"Governance structures and business models can remain stable in private sector organizations for decades … greatly simplify[ing] the process of identifying and implementing common best practice," the report quotes Jonathan Murray, a partner at IT consultancy Innovia Ventures, as saying. "Public sector organisations operate in a reality that challenges many attempts to identify and transfer best practice. There is no homogeneity of objectives across
government departments."

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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