What does HMRC's £150m investment in digital skills mean for the channel?

CRN spoke to Westcon and Performanta about the tax authority's increased IT staffing budget

HMRC is hiking up its spending on its IT staffing budget, which has grown to more than £150m - almost double the pre-pandemic figure.

According to data obtained under the Freedom of Information (FOI) Act by the Parliament Street think tank, a total of £152,871,499 was spent on 4,032 IT staff in the most recent financial year ending March 2023. This was a 91 per cent increase on 2019.

The FOI also revealed that HMRC has launched several new initiatives within its IT department, the Chief Digital and Information Office (CDIO) recently. HMRC said that around 2,000 learning requests for courses and training are submitted annually by staff, with some staff attending multiple programmes.

The tax authority has also developed 15 academies for the CDIO that deliver professional learning for specific technical roles such as data scientists or for functions and technologies like cloud computing.

How will it affect the channel?

This commitment to funding the public IT sector also comes with benefits for the wider channel.

"Reducing the skills deficit in the industry is great for the channel," said Matthew Piddington, VP services at distributor Westcon-Comstor.

"A more informed buyer understands the value of tech and how to optimise their investment and makes for a better customer; better-skilled individuals also mean lower IT project failure rates and higher customer satisfaction.

"Overall this leads to longer and better relationships with channel partners."

Guy Golan, CEO of MSSP Performanta also gave his view on the investment: "The channel can benefit from such an initiative. Both as a supplier to HMRC for technologies (licenses, software and hardware) and as a consumer, in the long run, to get resources that come out of these academies."

However, Golan warned that it all comes down to whether there is a plan, what that plan looks like and how it affects resourcing and salaries.

"The money is one side of it, and it is a very impressive amount. If there is no plan how the money will be spent on resources and training, then it will be a big miss.

"This amount of cash, or any for any matter, should be backed with a proper plan. Where the investment goes and what return am I expected to get out of it."

Piddington also expressed his interest in seeing the public sector investing in redeploying older workers into technology, as well as in young talent.

He said: "We have an aging workforce, and we need to learn how to best work with this experience with regard to new technology.

"Continued investment in apprenticeships, building skills in emerging technology and giving people an option outside of university are all important, as are schemes that introduce a more diverse talent pool into technology."

An overall-welcomed effort

However, Piddington also commended the move: "It is good to see the positive lead the public sector is demonstrating in investing in people, particularly with the war for tech talent.

"Finding different way to motivate and attract new staff to the public sector is key. The rate of technological change is ever increasing, so keeping IT teams up to date with the latest skills and competency is a real challenge.

"It is great to see this commitment from HMRC to this effect, as the ability to offer a digital-first capability to society relies on this type on investment."

Golan also echoed this view.

"Any investment in the human element should be commended. So, the HMRC's decision to increase the investment in IT skills and training is definitely a positive thing.

"At the moment it seems like HMRC is properly digitised both for internal use and for client facing usage.

"So to increase spend by 91 per cent needs to be heavily defended. Especially, when the private sector is cutting costs and laying off five to 15 per cent of their staff."

Golan explained that HMRC has been short staffed before and trying to meet the private sector's benchmark for salaries is a positive way to attract and perhaps retain more talent.

Looking forward, Piddington argued that: "Too often we see investment in new technology with no investment in learning and development, leading to the end customer not recognising all of the value they had expected to see from their technology investment.

"This is also reiterated by the constant publicity around IT project failure, IT projects which do not meet the functional needs of the business, are over budget and over time in terms of their implementation.

"Any investment, public sector or not, needs to keep this in mind."