Memo to Ministers: That's the Way to Do IT

HAVE you ever been in a situation like this: you call an electrician to have a look at a problem, and when he gets there he pokes around for a few minutes, before telling you he can fix it but it's going to be an expensive job.

What do you do? On the one hand, you need it fixed, but on the other, how can you be sure he's not bluffing? He's the electrician, he's the one with the expertise — you have no way of knowing.

It turns out that, for years, government ministers have been in a very similar position. Time after time, they have tried to solve problems by commissioning big computer systems. They would diligently call in the IT consultants to have a look at the scale of the job, and then be offered a price.

Of course, we're talking about government ministers here. There's no reason why they should know what's a fair price for a multi-billion-pound IT project; after all, would you? But then, time after time, they just went ahead and signed off on project after project, only to find they had been taken for a ride.

If you think I'm exaggerating, I'll let the record speak for itself.

• The NHS National Programme was supposed to mean all NHS records were online by 2005. That has not happened. Only about 160 health organisations out of 9,000 are currently using it, and the 2005 aspiration is years away from being complete. Suppliers have walked away, and "legal and commercial support" has cost the taxpayer £39.2 million.

• The Defence Information Infrastructure project was supposed to let all the armed forces use the same system. But it is now £180m over budget and 18 months late.

• The identity card scheme has been heavily watered down and is £2 billion over budget.

• An attempt to put all the records in magistrates' courts on to one system has cost £400m, nearly three times original estimates.

I could go on, and give you more examples, but you get the idea. The total cost is estimated at more than £26bn — more than half the budget for Britain's schools last year. Parliament's spending watchdog has called the projects "fundamentally flawed" and blamed ministers for "stupendous incompetence".

Why does this keep happening? One reason is MPs do not have enough experience in managing these IT projects. After resigning as home secretary, Jacqui Smith said in an interview she had "never run a major organisation" and that if she did a good job it was "more by luck than by any kind of development of those skills". As I have said before — full marks for candour, but it is a status quo that we would do well to change.

A second reason is blurred lines of accountability. An acquaintance — a senior public-sector chief executive — has told me that meetings to discuss the progress of some of the large IT projects with which he has been involved are farcical. They are "just a bunch of consultants sitting round the table", he says, "with everybody outsourcing to everybody else".

The third reason is that, quite simply, these IT companies are taking the government and the taxpayer — you and me — for a ride. I know an extremely senior IT consultant, who has told me explicitly that many of the proposals the IT companies offer government departments are all "smoke and mirrors". They know they are proposing technology they cannot deliver at prices that will inflate. So they name a price they think will win them the tender, sit back and, when it inflates, take the extra money.

That is our money. Surely we can do better than this.

What is the answer? First — we need more expertise at the heart of government. Ministers should accept that, when it comes to outsourcing and getting a good deal, they need advice — particularly from people who have done it before and know what they are talking about. Ministers should be accustomed to making use of private-sector expertise earlier in the process — at the stage when they are setting the tender and reviewing the bids. It should not be paid for either.

Second — at the moment, each government department spends on its own consultancy, gets different deals and duplicates a lot of the work. This should be overseen by a unified department, tasked with getting the best value for taxpayers' money.

Ultimately, though, the culture in government needs to change from one in which IT projects are regarded as a panacea, to a more hard-headed culture in which they are an investment on behalf of the public, pursued only after rigorous cost-benefit analysis.

Azeem Ibrahim is a research scholar at the International Security Programme at the Kennedy School of Government at Harvard University and the chairman and CEO of ECM Holdings.