Lack of IT expertise still a 'major risk' for government projects

Red- and green-light 'gateway' reviews are addressing the government's poor record of delivering major IT projects but the lack of in-house IT and project management expertise is still a "major risk", according to a report by parliamentary watchdog the National Audit Office (NAO).

The report, Improving IT Procurement, examines the effectiveness of the Office of Government Commerce (OGC) since it was set up to tackle a track record of over-budget and delayed public sector IT projects by monitoring, reviewing and recommending best practice on individual projects as they progress from business case to delivery.

Central government IT spend in 2003 totalled £2.3bn and since 2001 the OGC has operated six-stage 'gateway reviews' using a red-, amber- and green-light system for recommending whether IT projects should proceed to the next stage of the procurement process.

Of the 254 IT-enabled projects given a Gateway Review rating between June 2002 and March 2004, 50 per cent of them were rated as amber, where key issues need addressing, 28 per cent red, indicating immediate action needed and 22 per cent were green, indicating satisfactory progress.

Reviews are minimising the risk of IT failure and changing departmental and supplier behaviour for the better. But too many IT projects are entering the review process too late and leaving it too early, warned the report.

"A major risk, however, is that projects are entering the process too late - that is at Gates 2 and 3 (crucially, after the business case has been prepared), and exiting the process too early - that is before Gate 5 (when an assessment of the continuing need for the service, value for money and contract management arrangements can be made)," the report said.

There NAO report also warns of a continuing lack of appropriate project and programme management skills and experience, which present a "major risk to the successful delivery of IT-enabled projects".

The shortage of IT and contract management skills and insufficient involvement from senior managers was highlighted in 76 per cent of OGC Gateway reviews, followed by the need for better risk management and criteria to benchmark the success of a project in 54 per cent of reviews.

Sir John Bourn, head of the NAO, said in the report: "Government departments have a chequered history in the handling of IT-enabled projects and programmes. OGC has made significant strides in identifying reasons for past failure… These remain, however, early days and my report makes recommendations to build on these foundations in order to reduce the likelihood of future failure."