Digital transformation in government: addressing the barriers to efficiency

For government to realise billions of pounds in efficiency savings, those running departments need to improve their understanding of digital transformation, a new NAO report says.

‘Digital transformation in government: addressing the barriers to efficiency’ welcomes the stronger central function the Central Digital and Data Office’s (CDDO) provides in leading digital transformation. It also commends the CDDO’s fresh approach to helping government departments address longstanding challenges to digital transformation through its 2022 to 2025 roadmap for digital and data.

Earlier digital transformation attempts across government often prioritised simpler online interactions and merely layered new changes on top of existing services using old data and systems. This approach entrenched higher costs and earlier inefficiencies.

"The creation of the Central Digital and Data Office provides fresh impetus for digital transformation across government. Its roadmap is a good step towards addressing systemic issues and encouraging departments to take action," said Gareth Davies, Head of the NAO.

"However, to maintain momentum, government needs stronger digital expertise and sustained support from senior departmental leaders. Otherwise, these latest efforts will peter out and government will not achieve the savings and efficiencies that digital transformation has long promised.”

The UK’s independent public spending watchdog has previously reported on the barriers to successful digital transformation and its effect on departments’ operations and efficiency.

NAO's July 2021 report on ‘The challenges in implementing digital change’ identified six key areas of concern, concluding that successive government strategies demonstrated “a consistent pattern of underperformance” over a quarter of a century.

Digital change involves levels of complexity, uncertainty and risk which are often unique to each specific programme due to legacy systems,² existing operations and the difficulties of integration. These are complex and deep-rooted issues which take time to address and must be led by transformation programmes’ governance structures.

The NAO’s latest report finds that most digital change decisions in government are made by generalist leaders who lack the expertise to fully comprehend and tackle digital challenges. Government should build digital capability and support for non-specialist leaders to understand the issues posed by legacy data and systems. The report urges individual departments to appoint at least one non-executive director with digital, data and technology expertise and ensure that membership of their most senior decision-making board includes at least one senior digital leader.

The report also shows that the government already has a specialist skills deficit, only 4% of civil servants are digital professionals, compared with an industry average of between 8% and 12%. There is a major digital skills shortage in the UK. The number of government digital vacancies rose from 3900 in April 2022.