Examination of Witnesses (Questions 255-309)|
MARK ADAMS-WRIGHT, DAVID WILDE AND MARTIN FERGUSON
22 MARCH 2011
I welcome you to this session about the Government use of IT.
We are finding this Inquiry quite challenging but very interesting.
Could you identify each of yourselves for the record?
David Wilde: David
Wilde, Chief Information Officer for City of Westminster.
Mark Adams-Wright, Chief Information Officer, Suffolk County Council.
Martin Ferguson, Head of Policy for SOCITM and Associate Lecturer,
University of Birmingham.
Thank you for joining us. Mr Ferguson, in your evidence you made
it clear that you felt that central Government needed to consult
local government more about decisions about IT before making them.
What would be the benefits of this close cooperation?
I would like to answer that by pointing to a particular example,
which would be the Public Sector Network. This was something
that SOCITM envisaged in the late 1990s, in fact, and at the time
central Government was not a listening ear. The issue arose again
in the last Government's ICT strategy when the Public Sector Network
was proposedso a secure network across the whole of local
public services and central Government public services. The proposal
was for a major procurement of a national network.
We were not consulted on that, but later on, as those
things developed, the local CIO Council, which is a body that
SOCITMthe Society of IT Managementwas involved with,
put forward the proposal that actually we should be talking about
a network of networksin other words taking advantage of
the networks that already existed at the local level in local
public services. In Kent, in London, in Wales we have existing
high bandwidth networks for the public sector already in existence,
and our argument was, "Well, why not join these up on a national
basis around common standards?"
So is this more an issue about Government operating to Open Standards?
Indeed so. We would argue that there is a strong need for central
Government to take a lead, but in consultation with local government.
Our issue is that we have this Local CIO Council that reports
to a CIO CouncilChief Information Officer Councilat
the national level. But we do not have a direct line from local
public services into the development of strategy for implementing
Government policy in relation to IT and business change or to
But is this not simply a failure of central Government to understand
the resources that could be available to them if they were to
open their eyes and look?
I think it is and again I go back to the PSN, Public Sector Network,
example. There are assets out there, already in existencewhy
not reuse them?
Other witnesses have argued that the real problem is the Government
does not consider the IT question during policy developments until
they are already very far down the track with the policy. How
do you think we should address that?
I think one of the ways in which that could be addressed is by
looking to local government. The approach we take, which is very
much of starting at the policy end of the spectrum, is: what are
the key policies in a particular area? What are the policy drivers?
What are the priorities that need to be pursued in terms of reforming
local public services and making local public services more efficient?
We then drive the information requirements and business change
around those policy priorities and the technology to then underpin
that, rather than starting at the technology end of the spectrum,
as we would argue has been the case with many central Government
Indeed, our concern, for example at the present time,
is around the Universal Credit. That seems to be being driven
towards another big Government IT project, when we would argue
that the best procurement in terms of practice is at this what
we call pan-local level, which is a term we use in our response.
From the work that SOCITM has done over the last 10-plus years
in our annual IT Trends survey in local public services, there
is plenty of evidence that we get better value for money than
central Government does through big framework contracts and the
When you say pan-local, pan-public sector governance, what do
you mean by that in terms of a governance strategy and our protection
in commissioning? Aren't we just making things more complicated
for ourselves by trying to be too comprehensive?
I do not think we are because, assuming that we have interoperability
standards and common standards in terms of architecture set at
the central level, we can then procure against those. The point
is we do not have those at the moment. But if we procure against
those, by doing it at the pan-local level you are actually encouraging
a degree of competition in the market that is not encouraged to
the same degree by central Government procurement contracts.
Encourages competition? How do you mean? I do not understand
that at all.
Our experience is that by working at that pan-local levelso
that could be at a county level for exampleyou are working
at a scale that is sufficiently large for suppliers to be interested
in the work being tendered, and that then invites a number of
interested parties to tender for the work. Because at that level
we are closer to understanding what the policy priorities are
for the particular locality, the needs of the local public services
in those areas, we get a much better tie-up between the client
and suppliersa better dialogue, a better understandingwhich
all comes back to my point that, at the end of the day, we end
up with better unit costs at that scale of procurement than has
been the case with central Government contracts.
My next question is perhaps more for the whole panel. We know
that the Government is about to publish an ICT strategy. Has
local government been involved in or consulted about it?
Certainly, from the Society of IT Management's point of view,
we have not been directly involved at all. We have had, arguably,
indirect involvement in that until the end of December we had
a representative from the Cabinet Office sitting on the Local
CIO Council, and last July in fact John Suffolk, then Government
CIO, asked the Local CIO Council to prepare a local public services
perspective on Government ICT strategy; in other words, taking
Government ICT strategy, how would you implement that in practice
in localities in the local public services arena? We have been
working hard to develop that perspective. It is actually in online
consultation at the present time and offers to central Government
a parallel to, as you say, the forthcoming Government ICT strategy.
I am meeting shortly with Bill McCluggage, Deputy Government
CIO, and Chris Chant, Director of Digital Delivery, to ensure
that there is a good fit between that local perspective and the
forthcoming Government ICT strategy.
Mr Adams-Wright or Mr Wilde, have either of you been involved
in the formulation of this ICT strategy and what are you expecting
No. From my perspective, from Suffolk's view of the world, which
is a little different from everybody else's just at the moment
in terms of pace if nothing else, we have engaged in a number
of discussions and debates around strategic topics with central
Government, particularly around cloud strategies and so on. It
is very much a case of a discussion around a strategy that is
happening, rather than a collaborative effort. So, for me not
David Wilde: A
short answer, no. I have had some point-to-point discussions
with individuals in central Government around particular systems,
services and what have you, but certainly nothing strategic.
So you do not feel you are going to have joint ownership of this
David Wilde: No.
We do find it quite extraordinary that there is a strategy that
I believe will be talking about Open IT, and yet the process for
developing that strategy has been closed.
Chair: I think that
is called an irony.
Q265 Kelvin Hopkins: What
you are saying suggests that the Government is looking only to
the ICT companies, the providers of ICT, not the users, and the
White Paper will be dominated by providers rather than users.
Do you think they are making a big mistake in that respect and
they should be asking local authorities and even Government departments
internally what should be policy?
Our view from SOCITM is certainly that the track record of Government
in that respect is not good, and we say that in our response.
We can go back to numerous examples, and I think you are well
aware of failures of big Government IT projects that are, essentially,
provider led, technology led. Our evidence from the local government
scene is quite the reverse. Our projects are business change
projects, they are business led, and the technology fits within
that framework of the business requirement within local public
services. We would certainly hold that up as an exemplar of the
way that we should be approaching
You think local government is much better at this than central
I would argue that, certainly, yes.
And what is the evidence of that?
David Wilde: I
think it is less about the end user; it is more about purchasers.
I think the aggregate spend of local government in IT is probably
greater than that of central Government. I am fairly confident
about that. Also, I think we have a much more diversebut
personally I do not think diverse enoughsupplier base that
we procure from. All of that is being missed if we are looking
at an inward-facing central IT strategy.
In terms of there being Open Standards, the Government are developing
Open Standards and local government is not even being consulted
about what Open Standards to have.
There has not been any consultation so far.
Q269 Kelvin Hopkins:
Does this betray an ongoing suspicion by Government, by politics,
that somehow public institutionsparticularly local authoritiesare
not to be trusted, whereas the private sector can be trusted?
Certainly this was the case, I think, under New Labour. I speak
as a Labour MP, but not necessarily New Labour. There was a deep
suspicion of local government and an attempt to move as much as
possible of what they do out from local political control. Is
that a factor, do you think, in all this?
If I may? What I tend to find is that there was a view, certainly
from my perspective, that previous public organisations in the
local arena were perhaps less professional in the IT space than
the private sector. Whilst public servants continued in those
roles and there was not much cross-fertilisation between the private
and public sector that continued to be the case. I think over
the last five years there has visibly been a number of senior
players who have come from private IT organisations into the public
sector, and that has changed that feeling, but I do not necessarily
think that all of the senior officers in the public sector have
necessarily understood how that works. I come from a private
background into the public sector, and therefore bring some of
that experience with me that you talk about there, because I do
not necessarily feel I need to go to the private sector to get
the points of view that some may still feel they do at senior
I think that is a pointer towards the fact that the relationship
between the private sector and local public service people is
actually generally very good and is different, I think, in some
ways from that which exists centrally. What I mean by that is
the skill base we are talking about now for Chief Information
Officers, Heads of IT, Directors of IT in local public services
has changed and is changing. Now we are talking about people
who are leaders, are able to work with the leadership in local
public services; they are accountable; they are concerned with
governance arrangements; they are concerned with strategic commissioning
and output-based and outcome-based contracts; they are concerned
with risk and opportunity; and they are concerned with performance
management and realising benefits and savings. I think this is
a different skill set and it is one that SOCITM has been very
much behind developing in the local scene. As a professional
association we see that very much as our role, so we have accreditation
systems, we have a skills framework, which has been expanded to
take on board that strategic level of skill and competency. There
is no equivalent of SOCITM in central Government.
Q270 Greg Mulholland:
Mr Adams-Wright, if I could turn to Suffolk?
Greg Mulholland: I would
like to ask a few questions, because obviously Suffolk announced
that they are going to be outsourcing the majority of services
and saving 30% on the budget. Can I ask you what role you see
IT playing in that very substantial decision?
The first thing I would say is Suffolk is not really outsourcing
its services. It is somewhat of a misnomer. What we are doing
is moving towards being a strategic council with service delivery
moved outside of the core council. That does not mean outsourcing
in the traditional way, in very much a function-to-function view.
It is very much a redesign effort around how we do certain things
that are required in the public space that we are responsible
for. It is not an outsource as such; it is very much more opportunistic
and far more entrepreneurial than just that.
Where IT plays a role in that is quite key in actually
continuing to keep what we refer to as the ecosystem around public
service in place, which means as the council divests itself of
being a service leader and becomes more strategic, it is likely
to still need to keep control of legal entity on some of these
things, possibly of the data and the facts that are owned and
managed by some of these particular trusts or plcs, however that
particular organisation comes up. We see ICT as the pure backbone
for that ecosystem, and what we need to do is produce a system
that can work across SuffolkSuffolk plc if you likethat
actually links everybody together. We are very focused on Open
Standards and on live technologies that are quick to stand up
and easy to use and adopt; the kind of things that actually create
what we would call a virtual township across Suffolk, so that
it is easy for anybody within that ecosystem to do business with
Q271 Greg Mulholland:
Are you using the opportunity of this change of approach to rethink
how you use IT in delivering some of those services
Q272 Greg Mulholland: and
that is regardless of who is actually delivering it?
Q273 Greg Mulholland:
Have you got some examples you could give us?
Yes. Absolutely. We are very much a traditional local authority
in terms of the way our IT infrastructure is set upvery
much with thick applications of things. We have our major tier
one applications: our Oracles, our finances, all those types of
things. But as we look forward we know that we are going to need
to be a lot leaner in the way we do things. We will still need
functions but we will need them in a different way. Rather than
being a fairly linear relationship between a single entity council
and a single supplier, we won't be; we will be many potential
users of one single supplier system, so we have to change and
We will be looking to reduce our infrastructure dramatically
between now and 2014/2015. We will never get rid of it totally,
because there will still be some niche things that will be needed
within that Suffolk ecosystem, but dramatically. We are pushing
forward to work to basing all of our services on a private and
public cloud base. We are investing in our public-sector services
network, which is currently going in the floor and will be complete
by January next year, which will link up all of our schools and
our corporate sites into one network. It has been architected
and designed to then be able to leverage over and beyond to support
that ecosystem as it breaks up. Our website is being redesigned
now in a completely different manner using Open Source standards,
very much transactionally driven to support the shift agenda that
we have put in place, but also completely able to be leveraged
by any number of organisations that might wish to further down
the line in terms of the cost to stand up, the technology and
the ability to leverage off that single platform.
How do you leverage off a county council website? What does that
We have chosen to use a technical standard, and we have created
a platform from that standard. What we are doing in building
our website creates what we call templated websiting; in other
words somebody could take that template and at a very, very minimal
cost build all of their information into that template and put
it on the same backbone that we already have, which means the
interoperability between those sites is enhanced nth-fold from
using different technologies and different standards.
What does that mean for the user?
It means that, effectively, when we get down to the nitty-gritty
of what we need to do in that ecosystem, which is share data
Give an example of what that means? So, how would a county council
ratepayer or council-tax payer understand or see a benefit of
that? What is their experience going to be?
If we take one of the divested entities that might be looking
at the personalisation agenda through health, and we set that
up and they use one of those websites and they set that up, as
a citizen, when you have your personalised budget and you look
how you are going to spend that and what services you will need
from that, you will have a front-door website, but all the websites
where all the information sits across the Suffolk system will
be across the same backbone. So, it will be able to source itself
through those websites.
The citizen will not get signposted and required
to hit multiple points in order to get its answer. The website
and the front door will do that all for them to link them up to
where they need to be, because at the moment, if you need to do
something that crosses across public barriers or public organisations,
you need to go and hit them all separately to line up all the
information you need to make a decision as part of needing a service
in Suffolk. What this will do is allow you to have a single entry
point, and that single entry point will then allow that to all
be joined back together to deliver you an answer.
Q277 Greg Mulholland:
Are there any specific examples you could give with regards to
specific council services? Obviously, as the Chair has pointed
out, there is a danger with our Inquiry that we will become too
concerned with talking about cloud computing and Agile development
and all the rest of it. Of course, in the end what we are interested
in is how this will help deliver services and avoid some of the
costly failures of the past. So do you think you could give us
a couple of examples of specific types of services?
At the moment we are obviously going through our divestment programme.
It is a fairly major change agenda for the council, and most
of the major pieces of work have not gone out yet and divested.
What I can use is the example of one of the things that currently
sits on that backbone, which is a website called onesuffolk, which
is jointly funded by the districts and boroughs in Suffolk. What
it does is it aggregates lots and lots of information about Suffolk
into one place, and it also links off the back of that to other
parts of the Suffolk structure. If you have a request you just
go into that one place and it then directs you to where you want
to go, so you get all your answers from one point of entry.
Q278 Chair: I
am sorry; this is still a mystery to me. County councils do social
services. If I am a social services user, how will I use your
website differently from another county council?
It is not so much that it will be different in that way. The
fact is that the county council in Suffolk will have divested
itself of services; therefore, from a member of the public's point
of view, it can look more complicated as that goes out, because
it will not necessarily understand which particular parts of that
ecosystem will be responsible for delivering parts of those agendas.
What this is doing is facilitating that change to happen, to
take the complexity away from the citizen by using the IT as the
enabler to do so.
Can I just come in and illustrate it, forgive me, by using a
personal example? When my daughter was in her early teens she
contracted ME and at that point, as the parents, we were dealing
with 10 different public-service and third-sector organisations,
all independently, all separately. All had a separate record
of my daughter. What we are talking about here is the principle
of being able to address public serviceswhich includes
those delivered by social enterprises, by the third sector and
so onwith the need and to be able to be channelled to the
various services that would be relevant, but at the same time
for those services to be aware of each other, subject to consent,
obviously, in terms of data protection, which is where standards
and interoperability are important. In that particular instance,
with the education department of the county council we were dealing
with the school, with the transport service and the home tuition
service, and every single one of them had a separate record of
my daughter and her current state of need.
So, under this system there will not be a need for separate records?
There would be separate records but they would be capable of being
joined in such a way that the different service providers were
aware of what others were doing.
Q280 Kelvin Hopkins:
This all sounds wonderful and obviously Mr Ferguson's explanation
is more down to earth and more understandable. Mr Adams-Wright
is obviously a man who is on top of his job and knows everything,
but you speak in a jargon, a language, that I do not really understand.
I am probably like most county councillors, who would hear you
speak and say, "He is very clever; he knows what he is doing.
Leave it to him." But I am just thinking, like the Chairman:
I have a middle-aged woman who has not got a computer, who is
not computer literate, but her father is developing Alzheimer's.
She has to go to somebody at the council and say, "'Help."
What actually happens? She cannot press keys on a computer because
she has not got one. What happens?
Obviously, understanding from my perspective as the ICT lead I
would look at it from a technical perspective, so it is far easier
for me to talk about it in that light, but what the enabling council
will doand this is the term; we call it "strategic"
or "enabling" councilis it will start that process
off. Now, there is an electronic route, and I have started to
explain there how that might look, but clearly the same infrastructure
will be repeated at a very physical level by the council. They
will not stop being that point of contact for the individual but,
obviously, as the services are actually delivered elsewhere, they
can link that up, because there will be the knowledge base within
the council to do that physically.
Q281 Kelvin Hopkins:
But who will she go and see? Does she go to the county hall,
ring up somebody on the telephonebecause she can probably
use the telephoneand say, "Help."
Q282 Kelvin Hopkins:
And there will be a person who will then bring help?
Yes. That will not change. That single point of entry will not
change. It is really what is happening in the background, I think,
that changes, rather than all of that complication, all of that
linking together that currently sits within the boundaries of
the county council, moving away into a number of potential other
entities. So, that person for the contact, whether it be through
phone, face-to-facewhatever the contact will bewill
be responsible for linking that ecosystem back together. The
technology part is one stream of that that supports it. Obviously,
there is the face-to-face stream and there would also be a telephony
stream that would be useable in that instance.
Q283 Greg Mulholland:
A final question: I think it would be worth saying it would be
useful, if not in the written evidence, to supply some specific
examples of how it will improve the delivery of services for the
ordinary council-tax payer at a better efficiency/cost, because
that is obviously what we are interested in. Can I ask you: what
lessons do you think central Government can learn from what you
are doing in Suffolk?
I am under no illusions of the difficulty and the scale of what
we are trying to do. It breaks a number of pre-existing concepts
about the way that you deliver service through local government.
We face challenges that we will need to address. Some of them
are quite clear. Some of them are around IT security. The more
widespread you make your ecosystem the more complex it becomes
to retain security and drive cost out by making it a simpler system
to use. I think there is a lot to be learnt from central Government
in terms of the IT security agenda. That is certainly one that
we talk about a lot as we try and become more lean in terms of
costcoming together with a security agenda that works more
There will be lots of issues around data management.
From a technological point of view we are building a data warehouse
to bring all the data in from that system so that everybody can
use it, but there are lots and lots of complexities in doing that
and we will have to face those challenges. Obviously, in doing
all of this, creating that ecosystem in itself and having people
work in that interoperable way, from a political, practical and
operational point of view, is going to be a big challenge. Central
Government in almost this post-bureaucratic age is going to face
very similar types of breakdown in terms of moving away from larger
central costs into a more sculptured landscape of costs, where
different types of organisations are going to exist to deliver
types of services and ICT is going to almost be that constant
that will need to keep everybody linked together, whether it be
around information or whether it just be around understanding
who is doing what for whom.
From a central Government point of view there are
going to be some difficulties in breaking down some of the older
ideas of the larger organisational sets. We have had to do that
around our directorates, which is the map for us, and try and
take that and dramatically change the power bases, if you like,
within the councilbeing those verticalsinto a far
more homogenous corporate centre. That is not without pain and
difficulty, and I think it is a journey that inevitably has to
happen in order to move into that sort of space.
Q284 Kelvin Hopkins:
I can lead on, if I may. I understand, if I may say, that some
residents of Westminster cannot contact people now that things
have been outsourced and everything is electronic. They leave
messages and nobody gets back to them, and the accountability
seems to have gone. It is not the wonderful world that we hear:
that things have been outsourced and work better. They do not
actually work better. Residents are saying, "We used to
be able to get in touch with a person in the town hall and something
would happen." Now they leave messages on answer phones
and whatever: nothing happens. Is this the future: that we are
all going to be talking to electronics and no human being, and
they will not come back to us when we leave messages?
Chair: Westminster was
mentioned. I think perhaps we will hear from Mr Wilde.
David Wilde: Yes,
certainly. I think a lot of this is about perception at the time.
I have spoken with many of those residents when I have been at
resident committees and what have you, and there are residents
who say, "I cannot get hold of the person I used to be able
to get hold of," but there are many other residents that
say, "Actually, somebody is answering the phone now,"
so there is that balance between the two.
More importantly, I think, it is not just about the
phone: it is also about the internet and it is also about reducing
duplication of service. So, building on some of the stuff Mark
was saying: why should somebody tell us their name and address
10 times over to do 10 different services? We know it; we collect
council tax from them. Why can't we use that to make the process
for engaging with us actually easier? There are issues around,
obviously, information, confidentially and stuff that you can
manage through that.
In terms of the outsource/in-source sort of question,
I do firmly believe that the extent to which an outsource is successful
or not is entirely down to the extent to which you manage that
relationship with the supplier, in the same way as the extent
to which you manage in-house staff. To me, the in-house/outsource
question is consistently in both cases about what is your quality
of service? What are your expectations? What is the cost for
delivering that service? What benefit are you going to get?
You make the decision based on that. Interestingly, in Westminster
we do have a reputation for outsourcing most things, but there
are actually some servicesnotably planning and other servicesthat
we deliberately keep in-house, because we take conscious decisions
that they are better operating in that environment in that way
and the market, frankly, out there is not ready for an outsourced
I have a small service of my own within IT, which
is the education IT service that supports primary schools, which
is still an in-house service and I deliberately keep as an in-house
service because the outsource options out there are double the
price and for no better quality of service. So, as long as we
stick with that pragmatism and the good common sense decision
of that good old-fashioned combination of valuewhat you
are getting in terms of quality of serviceI think we will
be consistent around that.
What does technology do in that space? It can help
improve customer experience, but again, it will be as much down
to being clear about what the experience needs to be. For instance,
complex housing benefit cases do not lend themselves very well
to self-service online. Council tax does. In fact, council tax
especially lends itself well to direct debit of all things, so
it is not purely about particular technology types.
Can I just ask of Suffolk, by transferring so much to the private
sector by outsourcing so much, aren't you losing some core skills
that will enable all you to understand how those services work
and, indeedwe see this in ITisn't it the case that
outsourcing to large companies to be the prime contractors does
not necessarily insulate the purchaser from risk?
Part of what is retained within the future council will be the
commissioning element of what we do, which will mean there will
still be the strategic element remaining in the council that will
help bring all of that together, because we have learnt by the
very same token that Suffolk has an outsourcing for ICT and has
had for a number of years. My role as the commissioner now of
that service is to ensure that that continues to deliver what
the right strategy is for the council, which I define, but make
sure it still offers value for money and all of those other things,
and it is delivering the services that remain pertinent and relevant,
and that will not be lost to the council because I think as a
model we understand how valuable that is.
So, Mr Wilde, on the question of shared services and cloud computing,
you are currently in the process of sharing IT services with other
councils. What challenges does this pose to you?
David Wilde: It
is not just about sharing the services; it is about deciding what
the mix of outsourced and in-house is going to be as part of that
as well. The two, to me, go hand in hand. The challenges: we
have some very practical challenges out there, which is protection
of individuals and information, because, whilst you can share
IT, ultimate political accountability, certainly for sensitive
records and most resident records, still remains within the political
structures that we have, so we need to be able to reconcile who
has access to what information. That is not a difficult thing
if you come at it from the beginning clearly understanding who
needs to access what and how best to control it and set up the
right security modelsnot particularly complex.
In terms of practical sharing of IT like the techie
stuffdesktops, networks, all that kind of stuffthat
to me is very straightforward. It is about commercial arrangements
and striking the right deals in terms of suppliers. We have just
awarded a contract for London, a next generation networks framework
agreement, which is led by Westminster but has been deliberately
designed to allow any other London local authority, and, in fact,
the GLA, to buy into that contract if it is good value to them.
That, to me, is good sense and a good approach to the market
place and we have very good pricing on the back of it.
The fact that we are all going to be sitting on a
network from one provider is actually no different from the provision
we have had for the last 20 years. It is just the badge changes;
we have three or four network providers that service London.
We buy from them. We do not own our own as a general rule.
So it would be quite difficult to translate this experience to,
say, cross-departmental working in central Government?
David Wilde: I
do not think so. I think it is absolutely no different. The
challenge in central Government is to think that way. At the
end of the day, if you look at a lot of central Government IT
network purchases, if we stick with the same line, you will probably
find the vast majority are buying from no more than two or three
companies on two or three sets of physical infrastructure, but
buying it separately.
So there is a case for centralising this?
David Wilde: It
is whether you centralise or create contracts that allow you to
capture the value of scaling up and down.
The centre needs to regulate the style of contract in order to
enable this to happen?
David Wilde: Exactly.
That to me is more comfortable than centralising a network.
We have had one of those since 1997; it was called GSI and I think
we sawand there is plenty of evidence out thereas
time went on it became less value for money. I think centralising
the commercial arrangements and keeping them regularly rotatedso
regularly refreshedmeans you can keep on top of pricing
without compromising service.
Now, your objective to be 100% migrated to the cloud by 2015 and
to have divested yourself of all infrastructure, does that mean
people's council tax records are on Google Docs? What does it
David Wilde: No,
it means they will be in third-party services, certainly. It
will not necessarily be Google and the public cloud. They will
be in secure environments, but they will be secure environments
that other authorities might be using as well. In fact, if you
take our council tax records today, they are actually sitting
in Capita's infrastructure in the South East. They are not in
London and they have not been for probably five years. So, we
have already done much of that.
One of the great misnomers about the cloud is the
leap from "cloud: therefore it is Google", whereas to
me cloud is about making good use of much better commercial infrastructure
than the stuff I am looking after in City Hall down the road,
which is on some of the most expensive real estate in the country.
Why would I do that?
Is there anything that you won't be putting into the cloud for
David Wilde: No.
David Wilde: No,
nothing, not in Westminster. No. We are more than satisfied
with the extent of the security arrangements provided by commercial
providers. Our discussion, our debate and our decisions are based
around whether it is UK based or whether it is EEA basedEuropean
Economic Areaor what we would allow beyond that, and they
are very much information, governance decisions around compliance
with Freedom of Information Act, Data Protection Act and the like.
So do you think the Government's concept of a "Gcloud",
their own nationalised cloud, is mistaken for most Government
David Wilde: Why
have a nationalised one when there are plenty of privatised ones
The Government does need to create its own cloud to benefit from
David Wilde: Again,
I do not think so. If we look at where much of central Government
is today, much of the infrastructure is already outsourced, and
it is outsourced with third parties. In effect a lot of the Government
is already part way there in terms of commercial, almost cloud-based
services. The challenge, I guess, is the extent to which you
collaborate across those at an interdepartmental level, and also
I think the other challenge, the central local government challenge,
is: when do we start sharing across that boundary? The most obvious
examples in there are benefits. We have two large Government
departments responsible for means-tested benefits and we have
400-plus local authorities responsible for one sliver of means-tested
benefit, which is housing benefit, and between them there are
400 housing benefit systems, plus these big central Government
Q295 Kelvin Hopkins:
We have touched on the lack of in-house skill, particularly at
central Government level and the ability to manage these big companies.
Are they effectively prisoners of the big companies in that they
have not got the skills to make the judgments, but when things
go wrong the companiesthere are so few of themcome
back and say, "We know we have made a mistake, but give us
another contract and we will put it right." They just make
more money out of central Government; that is what has happened
in the past.
David Wilde: It
is certainly an ongoing challenge, I think, across the public
sectorboth local and central Government have suffered from
thisas well as the private sector, but less visibly. Some
of the hardest lessons that organisations learn is the point at
which you retain key skills in-house so that you can appropriately
manage those outsourced services. Now, I have worked in a number
of organisations where I have gone in and restructured around
putting those key skills in place, and I am not saying they are
right, but my view on itand they seem to work so faris
strategic leadership must stay in-house otherwise you will be
sold the product that your supplier wants you to buy.
Technical design authority, understanding where all
your IT is, is absolutely something that needs to be in-house,
but you do not need to retain the architects that build the components.
Security and configuration management is something that must
stay in-house because no matter how much you outsource you cannot
outsource responsibility for managing that data. You cannot outsource
the responsibility of data controller. The other area that too
often, I think, is missed on outsource arrangements is strong,
commercial management or service delivery management, which is
quite often the one I see missing when I go into outsourced organisations,
where they have done those key technical components but they do
not have the commercial nous to keep pace with what is going on
with the marketplace.
Q296 Kelvin Hopkins:
Another potential problem, as I would see it, both in local government
and national Government, is that you get the loss-leader situation,
where an IT company comes and offers you a wonderful package.
I am not an IT specialist; I speak to three gentlemen like you
who can bemuse me with your language, and I say, "Fine, go
ahead." Then next year you come back and say, "Actually,
it costs a bit more than we said." You suddenly find a 50%
cost increase on the second year and another increase on the third
year, and I am your prisoner. I can do nothing about it. The
private sector, big manufacturing companies, surely do not operate
David Wilde: There
are a number of private-sector companies that have fallen into
the same trap. I think they probably learn the lessons a bit
more quickly because the shareholders are a lot less patient and
they want it sorted. In central and local government, absolutely:
to me that is good procurement practice; that is understanding
what you are buying, and whenever I go out to procure goods and
services I look at total lifecycle, and there are simple things
that you must do in that, which is nail down what the price is
over time; be absolutely clear about things like indexation, inflation
and what have you, and get that out at the beginning.
The other thing to doand increasingly we are
seeing it happen in the public sector and it is healthyis
shorten the contract terms. 10-year deals: who on earth knows
what IT is going to look like in 10 years' time? With the service
providers out there nowand this is where the cloud has
actually been quite helpfulthe commoditisation of IT over
the last two to three years has made three- to five-year contracts
much more realistic propositions, and it is those shorter contracts,
frankly, that can reduce that risk of that lock-in.
We do have an issue in the UKand it is common,
I think, elsewhere in the worldthat public sector services,
because of the way quite often they have been constructed over
time, by their nature may have locked in a small number of suppliers
around particular sectors. One of my particular bugbears, which
I have spoken publicly about before, is in fact housing benefit,
where there are only two or three suppliers in the UK that dominate
the market. So there are 400 buyers but only two or three sellers.
That is not a healthy environment to operate in. How do we break
that? Probably through some radical change on how we operate
the service, but that is a difficult thing to do.
Q297 Kelvin Hopkins:
I cannot imagine General Motorsthere is a big plant in
Luton, where I am Member of Parliamentallowing themselves
to get into this situation when every second of the track moving
is so crucial. They could not possibly allow that to happen;
they must have had their own in-house expertise.
David Wilde: I
think if I remember rightly General Motors did get exactly in
that hole a number of years ago with EDS, and it cost them a lot
of money to get out of it. Sainsbury's is another example. There
are a number of private-sector examples. Maybe the other lesson
is maybe we should pay attention to what they did and perhaps
bring some of that into play in the public sector.
Q298 Kelvin Hopkins:
I must say my prejudice is against contracting outmy position
on the left might suggest thatand indeed where services
have been contracted out they have often gone wrong. Private
care homes are now in a terrible situation, begging Government
for money to keep them going when we had perfectly good in-house
direct care homes, which I know, because I have visited them in
my constituency, all closed down. So there were direct labour
organisations, which used to be superbsome of them, not
all of them, used to be absolutely superbthat the private
sector could not touch in terms of efficiency, management control
and whatever, and they were just brilliant. I saw them live 20
years ago. All contracted out now. Is it not the case that costs
could go up rather than down if they are contracted out?
David Wilde: Again,
it is back to my earlier point, I think. I have seen examples,
like you, of in-house services that performed well, have been
outsourced and have performed poorly, but if you lose sight of
what the service is there to do, how you measure that and how
much it costs to deliver it, yes, costs will go up. Again, I
do not make the distinction between in-house and outsourced as
a principle point. I think it is about consistency of how you
measure that service across both, and then the rest is really
about value for money. It is as simple as that.
Q299 Greg Mulholland:
If I can just fire one of your quotes back to younot yours
but Westminster Council'swhich is one that I think stood
out from the written evidence, Mr Wilde. In the written evidence
Westminster Council said that there was not normally, and I quote,
"a strong enough link to the desired business outcome through
the operational or policy lead responsible. Too often IT is viewed
as a dark art or worse still something that will just deliver
without needing to engage with the deliverers," so rather
poetic as well as an important point that we have explored in
our other evidence sessions. How at Westminster have you tried
to ensure that there is that strong link between IT and the actual
policythe business outcome that you are desiring?
David Wilde: We
cover it in three main ways. The first one is the strategy that
I wrote when I first got there. Now, that was an IT strategy
that sets out the infrastructure-free stuff that you have covered,
but also importantly covered how we are going to engage with the
public; how we are going to engage with business, the lines of
business out there. What was important was not writing the strategy
or even getting it approved by the Cabinet Member. What was important
was getting it approved by other directors in the organisation
and Cabinet itself so that they can understand. I was challenged
very hard by the scrutiny committees when I wrote it to make sure
that it was reasonably plain English, your point earlier, because
what they did not want was tech speak. They recognised the infrastructure-free
principle but what they did not want was detail on how it was
constructed. So that was point one; that set the standard; that
is where we were going to go.
It also set within it how we were going to engage
with the rest of the organisation. Now, when I first arrived
I inherited something called an IT board, which I was the chair
of. I scrapped it; it was pointless. We replaced it with four
boards around four lines of business: an adults' IT board chaired
by the adults' director; a children's IT board chaired by the
children's director; a built environment IT board chaired by the
director that covered the built environment and also worked with
planning; and I chaired the last one, which was corporate systems,
so HR, finances and desktops and what have you. Now what was
important there: I sat on all of them, which was horrendous for
the diary, but I had the business leaders chairing those boards
and making the decisions on how IT is going to change what they
do. IT became an integral part of their change programmes, which
were about restructuring how their services were going to be delivered.
I was there to challenge; I was there to bring into play what
IT could do, so a little bit of sales activity, but, critically,
it was not me deciding what we were going to spend money on in
IT systems; it was them. That, as a result, has enabled us to
take significant cost out and significantly improve services across
all four areas. So that is two.
The third part really is about demonstrating the
basic IT works and demonstratingthe point on in-house and
outsourced earlierin really simple terms that the IT will
do what it says it will dothe really basic stuff. The
IT that I inherited when I got there had very poor ratings with
staff, and we had problems with public access equipment in the
libraries. We spent the first six to nine months sorting out
a supplier that was failing to deliver, which was a fairly painful
process, and sorting out public access IT equipment in libraries,
because actually that had a massive impact on an awful lot of
residents and duff kit for the public is just not on: so, fixing
those basic things. As a result we have raised the satisfaction
levels and the confidence in IT to deliver in the organisation
to a point where we could have proper conversations around the
more transformational stuff. They are really the three things
that we brought into play.
Chair: A very useful answer.
Could I just say in local government that is not uncommon. Indeed
we have taken a step of, in local government, developing our own
methodology. Birmingham City Council has facilitated that; it
is called CHAMPS2. We have recognised that the MSP, Managing
Successful Programmes, and PRINCE2 methodologies, which are about
programmes and projects IT, are not actually appropriate for dealing
with business change. So what David is saying: we are starting
here with policy, priorities, business change, and the CHAMPS2
methodology provides that opportunity to involve staff, get the
governance arrangements right in terms of the key people who are
responsible for services making those decisions and realising
the benefits and savings out of the programme of change. That
is what that methodology does and it is freely availableit
is in the public domainto any public organisation to use
and, indeed, it is being used around the world, including Brisbane
City Council, for example.
Q300 Greg Mulholland:
The final million dollar question or actually billion dollar question
is: considering the very poor record that central Government has
in terms of delivering IT projects and not having that clearly
linked to defined business/policy outcomes, what can central Government
learn from what you are doing to take forward to try to improve
David Wilde: My
challenge when I arrived at Westminster was interesting and very
direct and to the point. My question I asked at the end of my
member panel was: "What do you want me to do?" To which
the answer came back straight away: "Sort out the supplier,
reduce the cost and make it work." That is a pretty clear
mandate. So, in simple terms you properly align IT to the businessproperly
align itand get the business owners to sign off on what
the project does with their eyes open. What does this really
mean? What I mean is, do not look to IT to make Government work
better. It won't. It can enable it but it will not do it on
its own. That is probably one of the harshest lessons that the
national project for ITthe health one, learnt. So, I think
that linkwhat you want is directors general in Whitehall
signing off on these things. What you want is CIOs advising them
as to the right course of action and challenging what they are
doing, but critically, those guys need to be signing off knowing
the full impact of what is going to be done in terms of the bottom
line. Again, Westminster is very focused on the bottom line.
Mr Ferguson, you mentioned earlier that IT costs in local government,
unit costs, are much lower than central Government. Why is that
and what do you think central Government is doing wrong?
I think it is because at the level at which we procure, which
typically is through local purchasing organisations and the like,
so it is local authorities cooperating together around particular
contracts and procurements, we are able to be much more flexible.
For example, using reverse auctions is one particular way of
procuring desktop PCs that has been used in a number of situations,
but a whole range of different procurement methods have been used.
I think it comes back, as I say, to closer and more constructive
relationships with the supplier community, a better understanding
of suppliers and what we are trying to achieve. It is that expectation
that it is not about the technology; it is actually about what
the technology can do for the public services, and that ability
to then drive costs down through a competitive procurement process
that is genuinely competitive at that level.
And could you actually produce figures that prove your case?
We do have figures; I can make those available to Committee members.
If you could submit a memorandum to us
Q304 Chair: with
those figures, I think that would be of great interest to us.
Mr Wilde, the corollary of you getting the service heads to chair
their IT boards means that the Permanent Secretary of the Treasury
should chair the IT board for HMRCor at least the Chief
Executive of HMRC should chair the IT boardor the Chief
Executive or the Permanent Secretary at DWP should chair the IT
board at DWP. Is this your experience of what we do?
David Wilde: It
was not the Chief Executive that chaired any of those boards;
it was the next step down and I think that is what is really important,
because at the Chief Executive level, you are putting a layer
up, then it is only going to come down. If you are deliberately
targeting at DG level, a more appropriate example, if we take
HMRC as an example, would be the DG responsible for VAT chairing
a board that has IT, and what IT is going to do on how you collect
VAT. In DWP the person responsible for invalidity benefits or
disability benefits, the DG responsible for unemployment benefits.
It is that kind or relationship, because you are closer to what
the business is about then and the CIO can engage in a way that
can facilitate change. A big challenge of course, with both organisations,
which we do not have, is they have large delivery agencies as
well. So, as well as having a Whitehall core, you have, in the
case of DWP, Jobcentre Plus; in the case of HMRC, the delivery
arms around revenue collection and the old Customs and Excise
setup. But I do not think that is insurmountable; it is just
finding the right people who are accountable for that change and
putting them in charge.
So the rule should be: if your department is ordering the system,
you should be chairing the working party that is procuring the
David Wilde: Yes.
It is not something that line management can get rid of to a systems
David Wilde: Absolutely
not. Absolutely not.
Is that what tends to go wrong?
David Wilde: I
think it is a major issue, absolutely right. Where is the buy-in
to change if somebody else is doing it?
Right, buy-in for change, because actually incorporating systems
is about corporate change.
It is. Absolutely right.
Very good. Finally, I should have just mentioned at the beginning
of the session I prefer to declare an informal interest. The
chairman of Fujitsu Europe is a very close personal friend of
mine, but that is just on the record. Can I ask a final question
to each of you: what are the particular recommendations you are
looking for our report to make? If you have got one each, that
would be jolly useful.
For me my recommendation, what I would like to see is more Open
Standards and a better link with sensible policies for local government
to link into central Government with. That is a very practical,
on-the-ground view for me.
David Wilde: I
would like to see an IT strategy that is based around the services
we deliver to the public, not around central and local government.
I would like to see that stronger link between the local and central
built aroundas David says, exactly that pointdelivering
to citizens what really matters to them. For example, in the
Universal Credit arena we do challenge the approach that is being
taken at the moment that does not take into account that wealth
of expertise and knowledge that is available at the local level
about how to deliver benefits effectively. We need to bring those
things together to ensure a successful implementation of a project
Chair: Gentlemen, thank
you very much indeed. It has been a most useful session and no
doubt we will think very deeply on your preferred recommendations
as well. Thank you very much.