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The Guardian | Wednesday 14 July 2010 7

The Guardian roundtable in association with Fujitsu

Remote control
The £16bn annual public sector IT budget is one of the areas earmarked for cuts. Can ‘cloud computing’
overcome security and data privacy concerns to deliver savings? SJ Pritchard reports on a recent debate

overnment plans to cut shared between applications and users,
25–40% from depart- the cloud also handles peak demand bet-
mental budgets – except ter than conventional systems.
for health, education, In government, this could reduce the
international devel- pressure on any department that has occa-
opment and defence sional peak workloads. Examples cited
– are prompting scru- included handling tax returns and dealing
tiny across all areas of with a potential pandemic.
spending, including IT. The G Cloud has already gone some way
The plans are forcing departments down this route, by providing test and
to look at alternative ways of delivering development servers that departmental
services, and new technologies that can IT teams can bring online remotely. Cur-
provide cost savings. One concept that is rently, departments are able to use these
attracting interest is “cloud computing” servers free of charge.
(see panel, below right). Over time, it could provide a number of
In essence, by running applications on alternative commercial models for public
remote servers, connected over the inter- sector bodies’ IT purchasing. The flexibil-
net (the “cloud”) – rather than on local ity of the cloud allows for much shorter-
machines – organisations can save money term arrangements than the typical five-
and also become more flexible in how they year contract, and for some services it
buy and run IT systems. could do away with fixed-term contracts
In response, the government is cre- altogether, moving to a per-transaction or
ating its own cloud computing service, per-click way of paying for IT. This could
the G Cloud. be attractive for local authority services,
In a roundtable organised by Guard- such as environmental protection or park-
ian Public, and sponsored by IT services ing, where calculating a per-transaction
company Fujitsu, senior managers from cost for IT services is relatively straight-
government and the private sector asked forward.
whether cloud technology can deliver It would be much harder in areas such
some of the efficiencies needed to cut as social care, which depend far more on
public sector costs. direct contact between council employees
The event was conducted under the and their clients, and where an individual
anonymity of reporting allowed under the receives services from the authority for
Chatham House rule to encourage frank years, and maybe even a lifetime. For those
debate, so this report picks up themes that services, a longer-term contract is likely to
were discussed, without attribution. remain the best option.
Attendees also pointed out that, under
Savings current IT outsourcing programmes, two-
In the run-up to the election, both opposi- or three-year arrangements remain more
tion parties committed to making cuts in cost-effective than those lasting a year
government IT spending. or less. But cloud computing could cut
Since then, the government has con- costs, allowing providers to use a “fixed
firmed that ID cards will be scrapped, the cost minus” structure, where the contract
ContactPoint child protection database costs fall each year as the system becomes
subject to review with a view to termi- cheaper to run.
nation, and the costs of England’s NHS
National Programme for IT are also being Barriers
re-examined. There are significant obstacles to using
Public sector IT projects have a poor a cloud system. Information security
reputation for value for money and on- remains a challenge in the public sector. Huge proprietary servers could be a finance. It replaces the need to move the remains an issue and, according to attend-
time delivery. Whether or not it is fully The way public sector bodies purchase thing of the past, with offsite specialists physical data centre, and its servers and ees, it is one that the development of the
justified, departments will need to control IT services is also an issue. In local govern- providing both the computing power and staff, with a shared service provider. G Cloud has not yet resolved.
their spending on technology if they are to ment some 400 authorities currently buy crucial services Photograph: Alamy “We can put up a ‘software as a service’ On paper, a cloud only available to the
meet financial targets. around 100 applications from a dozen ven- application for 20% less than a standard UK government should provide the rel-
Among IT professionals, cloud comput- dors. In most cases each contract is negoti- application,” said one attendee. “And if evant assurances, but some attendees
ing is seen as a way of cutting costs, some- ated separately, with “a lot of taxpayers’ you are happy that the application is avail- said that in practice this is not always the
times drastically. Organisations using the money wasted in the process”. able only during office hours, for example, case, as there are some types of data that
cloud reduce their capital investment and Providing standardised versions of you will save money.” simply cannot be shared: areas such as
the need for software licences, by paying some key applications – such as enter- There are limits to the potential: most defence and security, parts of education,
for the IT service as they go. As cloud com- prise resource planning or customer rela- What is cloud computing? departments will need to run some spe- health and social care, and some categories
puting companies can pool expertise and tionship management – would cut down cialist software applications, and it may of financial information. Even details of
resources across a large number of custom- costs, and allow councils to choose from not make financial or practical sense some buildings are too sensitive to share.
ers, operating costs should also be lower. a menu of pre-customised applications, Cloud computing is a catch-all term for to run these in a cloud, as the providers Providing services through a govern-
Cloud computing for public sector IT developed and tested by the vendors. IT services delivered over the web. would not achieve the economies of scale ment cloud does, at least, solve a problem
does pose challenges, however, especially This would remove the need for each Companies or government bodies needed to reduce costs. Organisations that highlighted by one attendee, who wanted
in the areas of security and data privacy. council to buy the software and then can use cloud computing for email, have tried cloud computing so far report to use a commercial cloud service for a
In many instances, it is difficult, or install and customise it, a process that can to run websites, store data or, that it works best, where the technology back-office system: cloud providers with
even impossible, for public bodies to use take two to three years. increasingly, run complex business is largely standardised. thousands of customers will not want to
standard, commercial cloud computing Supporters of the G Cloud hold it up applications. But rather than install One attendee pointed out that his customise their applications. Customisa-
offerings. In response to this the govern- an as an ideal vehicle for delivering such the software themselves on their own employer already runs desktop software tion is a service G Cloud could provide.
ment is developing the G Cloud along with applications. Software companies, for computers, on their own premises, the applications through a cloud computing However, attendees also expressed
the Government Applications Store (GAS), example, could provide customised ver- “cloud” provider does this for a fee. service, and several others were using concerns that a government cloud could
from which civil servants will be able to sions of their applications for social care or Google’s Gmail, Microsoft’s Hotmail online applications for areas of customer become a barrier to innovation. “I’d be
download software or access services run- housing administration on shared servers are consumer cloud computing relationship management. Some were also very worried if it [applications] had to be
ning on the cloud, much in the same way running in the cloud. services, and there are specialist looking at cloud services as an alternative accredited by the G Cloud,” said one.
iPhone owners can download applications Cloud computing was also suggested as a offerings for government, such as the to current desktop office software. Slowing down the delivery of new
from Apple. way to provide IT support for departments data storage element of Fujitsu’s Flex In the private sector, cloud providers services, adding to costs and forcing even
When G Cloud was launched, under or councils which want to move to shared service for the central government. can bring new services and applications systems’ non-secure data to meet overly
the previous government, its backers services, such as in human resources or online quickly. As computing resources are stringent security requirements were fore-
claimed the strategy could save £3.2bn of most among the concerns.
the annual, £16bn public sector IT budget.
But to do this, government departments
At the table The solution, one attendee said, was for
departments or local authorities to carry
need to increase use of the cloud, and cut out their own classification of data, and
back on departments’ and local authori- Rob Norris Dr Katy Ring Richard Bull ensure that only those that needed the
ties’ own IT infrastructure. IT transformation Director, Business unit highest levels of protection were stored in
The scale of the task is significant. The director UK, K2 Advisory director for HMRC, the most secure, and expensive systems.
government has 120 data centres, and there Fujitsu Fujitsu Lower security applications could well be
is the potential to reduce this number. hosted in the cloud.
As one attendee pointed out, by no The IT industry firmly believes that the
means all, and probably not even the public sector stands to make significant
majority, of data centres offer the same savings through the cloud, even if only the
standards as the best private sector Ian Osborne Simon Norbury James Gardner simplest and least specialised applications
facilities, either in efficiency, capacity or Project director, Principal Chief technology are run that way. But the feeling was that,
in security. Digital Knowledge consultant, officer, although more could be done to encourage
The picture is even more mixed in local Transfer Network Red Pepper 52 Department cloud computing, forcing departments or
government. With a new data centre cost- for Work and councils to use it is not the way forward.
ing around £35m, it is hard for the public Pensions Instead, the G Cloud should provide
sector to justify the investment. the right services and organisations can
Cloud computing should, attendees choose to come in.
agreed, provide a way round this. Private Mark Say (chair) Bill Limond Merlin Hay,
sector firms are willing to build IT infra- Editor, Director of Earl of Erroll
structure up front, if they are confident GC Magazine information Parliamentary
there are enough government users to jus- systems, Information
tify the investment and the pricing allows City of London Technology
acceptable profit. Elements of the Aspire Committee,
IT contract, for HM Revenue and Customs, House of Lords
are already provided this way.
As well as cost savings, supporters of Ben Ticehurst Des Livings David Wilde
cloud computing say it will give depart- Head of business Deputy IT Chief information Roundtable report commissioned and
ments better access to standardised transformation, director, officer, controlled by the Guardian. Discussion
applications and common infrastructure. Peterborough city Department for Westminster hosted to a brief agreed with Fujitsu. Paid
Sam Friedrich

This should drive down the cost of IT council Culture, Media city council for by Fujitsu. Contact Tori Prince 020-
and make data exchange easier. Several and Sport 3353 2535. For information on roundtables
attendees pointed out that data sharing visit: