Less than 7% of a programme of savings in Scotland's bloated public sector IT spend have been made nearly halfway through the five-year time frame stipulated by a landmark Scottish Government savings programme, the Sunday Herald can reveal.
The McClelland Review, authored by the leading IT businessman John McClelland and published in June 2011, was the first comprehensive attempt to quantify the amount that official Scotland spends on digital systems.
It revealed that in their collective spending, local authorities (£525 million), NHS Scotland (£350m), the Scottish Government (£290m), development quangos (£185m), higher and further education (£150m)and police and fire services (£95m) were collectively haemorrhaging hundreds of millions of pounds annually through "fragmented and inadequate" systems, both in outdated internal systems and goods and services inefficiently procured from external suppliers.
McClelland identified "significant and serious shortcomings" in the allocation of public funds, noting "there is no central sector or national collection of value spent".
The report read: "The public sector's fragmented and inadequate mode of engaging and tendering with suppliers together with the structure of the industry, leads to the conclusion that additional savings within the £875m of external spend could begin in the year 2012-13 and grow progressively over a five-year period … In the year fourth year [2015-16] the annual savings would be at least £230m per annum and the cumulative savings over a five-year period beginning in 2012-13 would be at least £870m and potentially up to £1bn."
But data supplied to the Sunday Herald showed that to date only £56.1m, or 6.6% of the minimum potential saving identified by McClelland had been saved to date.
In a response to this newspaper's request for figures, a Scottish Government spokesman said: "A number of collaborative procurement frameworks are now in place and are being utilised by the public sector. There are more in the pipeline to deliver on key areas of the strategy but the results to date confirmed benefits for Scottish Procurement collaborative ICT procurements are £56.1m [for the spend period 2011-14].
McClelland, who as chairman of Skills Development Scotland last week co-launched a £6.6m investment plan to boost skills provision in Scotland's ICT industry, said that in the three years since the publication of his report "a lot of effort and a lot of time has gone into creating the right structures [within government]". These, he said, were the necessary prerequisite to the Scottish public sector "spending more wisely and collaboratively".
While McClelland said that he still believed that the £875m-£1bn in cumulative savings target was "realistic", he stressed that he had always assumed that the bulk of the savings would be made towards the end of the specified timeframe.
He added: "When I set it up that way I expected it to be realistic, and the Scottish Government would have challenged it if they didn't think it would be the case. [The savings target] is an opinion, the final proof will be in the outcome. I was honestly assessing what the opportunity was but I was very conscious that it would take a while to get the infrastructure in place, and the external procurement. I'm not disappointed."
Professor Michael Fourman, of the School of Informatics at the University of Edinburgh and the main author of an influential report on Digital Scotland, said: "I suspect that [the McClelland reform programme] was going slightly behind schedule but that's not surprising given its complexity.
"John McClelland identified one of the problems as being that a lot of the suppliers were tied up in contracts that it would be complicated to get out of. I wouldn't say that these figures show that this programme isn't going to work, they show we should continue to keep a close eye on it to make sure that we do get these savings".
In a letter to the convener of the Scottish Parliament Finance Committee dated February 19, Cabinet Secretary for Finance John Swinney said the achievements to date of the Scottish Government's McClelland-influenced digital strategy included the development of, and agreement, to a cross-sector high-level operating framework for ICT infrastructure and systems. They also included the award of a contract for a single communications network service for all public bodies [known as the Scottish Wide Network].
Among the priorities for 2014, Swinney wrote, was the publication of a data centre strategy, due for publication as early as next month.
According to the McClelland Review, the Scottish public sector's fragmented collection of 120, often eco-unfriendly and inefficient data centres should be rationalised to around 10, a figure that Fourman said "should be in the upper range of estimates for a country as small as Scotland".