HMRC reveals details of £328m IT spending plans

The overview of the department's potential commercial activity provides a forward look at their anticipated outsourcing activity, and includes all major projects and anticipated procurements valued at £2m or more.

Amongst the potential spend of £324.8m on IT services, the three biggest line items were:

• £190m to re-compete for the existing Managed Desktop Service set to expire at the end of June next year;
• £70m for Digital, Data and Technology resources to support and develop new services at new 'digital delivery centres';
• £27.5m for building and operating a Continuous Integration-Continuous Delivery capability in public cloud, using open source technology. For the latter, HMRC currently uses AWS.

Of the total spend on IT services, 7% was allocated to data and analytics, 21% to IT applications, just over 5% for networks and hosting, 24% for general IT, and 66% for mobility and workplace services.

Overall, IT contracts amounted to 22% of planned spend over the next 18 months.

In January the Parliamentary Accounts Committee (PAC) issued a report recommending that HMRC focus on IT transformation. Then the department had accepted it should redress the balance between spending too much on legacy systems and not enough on investing for the future.

HMRC secured £268m in the November 2020 Spending Review to fix its outdated IT, to ensure its core systems are secure and support better administration.

According to the PAC findings in January, HMRC should refocus IT investment on modernisation for the future, while retaining resilience, so it can move on from the need to simply keep patching up legacy systems.