Government IT budgets decreasing around the world

Government agencies in every country are now more dependent on IT services and related technologies than ever before. Yet despite this trend, global government IT budgets are poised to decrease in the near future, according to a recent study.

Gartner's 2014 CIO survey included more than 2,300 respondents, of which 288 were from government agencies. These governmental bodies covered all jurisdictions, regions and domains.

Among these government CIOs, more than one-quarter anticipated budget decreases in 2014. This finding is almost identical to last year's survey.

Rick Howard, research director at Gartner, put a positive spin on these figures.

"[W]ith nearly 75 percent of government CIOs reporting flat or increasing IT budgets for the second year in a row, many government CIOs have an ongoing opportunity to build capacity in high-value areas – such as mobile services and business analytics – while retooling IT portfolios to include more software as a service (SaaS) and public cloud solutions," he said.

However, the survey also found that the pressure is mounting for many CIOs to cut IT costs, particularly those based in governments facing overarching budgetary issues.

Technological challenges
One of the most pronounced challenges facing government CIOs, the study found, is the growing use of unauthorized IT services and devices among employees in every agency.

"Regardless of how much IT spending happens outside of the IT organization, CIOs must address the presence of shadow IT by affirming their position as the designated and recognized point of IT management responsibility," said Howard. "This doesn't mean CIOs should attempt to restrict business-managed IT acquisitions and services. However, accountability for the information assets of a government agency cannot be distributed, and governance will ensure a corporate officer, the CIO, is at the table whenever or wherever an IT investment is being considered."

CIO shift
This ties into a broader trend affecting IT departments in both the public and private sector. As a recent Avanade study highlighted, the IT department's responsibilities are increasingly shifting away from direct technology management and more toward procurement, consulting and service brokerage.

"I don't know of anyone who actually calls himself, or herself, a service broker, but the fact is that that is exactly what IT managers are becoming," explained Avanade CTO Mark Corley, ZDNet reported.

There is a growing awareness among CIOs that outsourcing IT service management is often more efficient, reliable and cost-effective than striving to keep all of these operations in-house. As a result, CIOs and other IT leaders must focus their efforts on choosing the right third-party IT service providers with which to partner.

This is particularly true as the pressure to cut IT budgets among federal agencies continues to accelerate. Selecting the ideal vendor or service provider can save agencies a tremendous amount of money while improving the government's data management, business intelligence and a range of other IT capabilities.