This is the first in a three-part series on the future of government IT spending.
Federal IT spending will be viewed with a keen eye in 2013, since there are clear indications that it will drop from its steady rate over the past four years, including fiscal year 2012. In what the Professional Services Council (PSC) calls the “Addressable IT Budgets,” the allotted IT budget is due to decline five percent, from $121.7 billion in 2012 to $115.5 billion in 2013.
As Kevin Jones at AOL Government discussed in a recent article, despite the looming threat of the sequestration spending cuts and the pending fight over the debt ceiling, all signs point to the government carrying out its original four-pronged mission priorities highlighted in the White House’s its Digital Government Strategy of maximizing ROI in federal IT; closing of a productivity gap and overhauling government into the 21st century; interaction and national priorities; and cybersecurity.
FY2013 marks a new era in federal IT processes and allotment. The administration’s mandate has been to root out waste and unnecessary spending by streamlining and consolidating operations across all agencies. This began when the White House unveiled PortfolioStat in the past six months, an IT dashboard designed to facilitate transparency in IT projects and spending.
According to the Office of Management and Budget (OMB), this plan will save taxpayers approximately $2.5 billion over the next three years. For example, OMB Deputy Director for Management Jeffrey Zients stated on Whitehouse.gov, “the Department of Homeland Security will save $376 million over the next three years on their IT infrastructure, including mainframe and server products, by leveraging the bulk buying power of the entire department.”
If congress and the administration do not reach a deal before the March 1st deadline, sequestration will bring mandatory cuts of over $1.2 trillion over the next eight years. According to PSC, five percent of those cuts will be pulled from IT budgets from agencies across the federal government, a significant chunk to swallow in any marketplace. Yet opportunities will still remain for IT contractors looking to support the administration’s Digital Government Strategy.
The White House has continued to focus on the Digital Government Strategy despite budget uncertainty.
As Kevin Jones pointed out in his AOL Government article on the subject of federal IT budgets, “[The Digital Government Strategy] is designed to have agencies focus on being more information-centric and less document-centric in managing their data and content.” This task has been given to US CIO Steven VanRoekel to lead, whose key objective is for the government to maximize ROI by delivering high-quality digital government information and services anywhere and across all devices to the American people.
The federal government is currently operating without an approved budget under a continuing resolution, and the Federal Office of the CIO’s main role is to provide information technology guidance to agencies and departments, so there is often a disconnect between the office’s policies and agencies’ funded priorities. Yet agencies such as the Department of Defense, Environmental Protection Agency and Department of Veterans Affairs are embracing the digital government plan as a coordinated effort to create common digital delivery platforms, streamline development, standardize practices and ensure consistency.
These efforts are leading to agencies embracing cloud, mobility and digital data solutions that yield a more efficient, cost-effective and, at times, consumer-driven environment.
Check back to the FedPulse blog next week for the second of this three-part series on the direction of government IT spending.