The Cabinet Office has pledged to consider smaller, more innovative companies when looking at government IT spending in the future, following a National Audit Office (NAO) report which claims Whitehall is making "a good start" at saving money.
The government claims that last year it saved £410m on its ICT spend, and is set to save a further £200m by the end of March this year.
The NAO's Impact of Government's ICT Savings Initiatives report, which was released today, said the appointment of Cabinet Office commercial experts helped to claw back cash as well as to negotiate better contracts with suppliers.
However, data weaknesses held by the Cabinet Office led to the NAO not being able to validate a further £348m worth of savings between 2011 and 2012.
The government said it is committed to spending with more innovative companies, particularly those embracing open source technology.
A spokesperson for the Cabinet Office said: "...Because ICT spending was so wasteful in the past, we also know that there is still a long way to go. We must accelerate the pace of change.
"That is why we are determined to fully open up government ICT to smaller, more innovative companies, and to embrace open source technology.
"As we reform the Civil Service, the government has committed to providing 'digital-by-default' services designed around the needs of the user, as set out in its Digital Strategy and the departmental digital strategies published at the end of last year."
Mark Taylor, chief executive for open source provider Sirius, said the government's plans are encouraging, but will not be popular among legacy vendors.
"Procuring open source solutions based on open standards from innovative UK SMEs is the key to public service reform, opening up government, reining in costs and stimulating growth and employment in the UK economy," he added.
"It will not be popular with the legacy oligopoly that has dominated public sector ICT for so long, but it is a strategy that achieves optimal results for every other player.
"The NAO report is very encouraging."
Infrastructure provider says international sales now make up 51 per cent of its revenue
Suzanne Chappell of TMS plans sailing venture after selling Oxfordshire-based TMS to acquisitive Chess
Withdrawal of credit insurance by some providers a 'reflection' of current challenge facing IT sector, according to MD Steve Soper
SMART's UK managing director joins Lenovo to boost SMB business