UK public sector IT spending to suffer 'very slow growth'

Southern Europe to bear the brunt of spending pinch, IDC report suggests

A north-south divide is emerging in terms of public sector IT investment, with Spanish and Italian spending feeling the pinch as the UK and German markets hold firm.

A report from IDC finds that the big western European economies - France, Germany, Italy, Spain, and the UK - account for more than three quarters of government IT spending across the region. The public sector in western Europe currently lays out $53bn (£32.7bn) a year on hardware, software and services, with more than half of this spent by local government bodies.

The UK is the biggest-spending nation in the region, but "it will experience very slow growth" until 2018, predicts IDC. Germany will experience the most rapid growth in the coming years, although its compound annual growth rate for 2013 to 2018 will be just 1.2 per cent. Spain and Italy, meanwhile, "will suffer the biggest slump".

Spending on IT systems for areas such as pensions and tax will grow at a faster rate than those in policing and security services, although IDC flags up immigration and border control as an area that is seeing IT investment.

Massimiliano Claps, research director at IDC Government Insights, said: "Spending reviews have made an impact on UK, Dutch, and Irish government IT spending. They are now affecting the Spanish government IT rationalisation and consolidation strategy and are expected to push further cuts in Italy.

"Those countries that have already implemented cost optimisation are starting to rebound to make investments to take advantage of ‘third-platform' technologies."