The "Market for Software and IT Services" study by industry analyst group Ovum Holway predicts the government IT market will grow 30 times faster than the private sector.
The report said: "The UK e-government agenda is wildly ambitious and it remains to be seen how successful it will actually be. However, vast sums of money will be spent over the next five years, and it will be spent a lot more freely than in the commercial sector."
The £ 2.3bn NHS IT programme, £ 1bn criminal justice system IT overhaul and the £ 5bn MoD outsourcing contract are the major drivers behind this growth.
Tola Sargeant, analyst at Ovum Holway, told silicon.com: �It mainly comes down to government spending. The NHS and MoD have some major investment plans for IT and that is what is driving it.
The overall UK software and services market was worth £ 22.1bn last year, with the public sector accounting for £ 5.08bn. The market as a whole is predicted to show a 0.2 per cent drop in 2003 but the public sector is set to buck the trend with 5.5 per cent growth.
Between now and 2006 the public sector is predicted to grow at an average of 9 per cent a year compared to 0.3 per cent for the UK commercial sector.
Government IT projects are also increasingly looking at using a broader range of suppliers rather than "single sourcing" mega-deals. Even where one major supplier is used, large parts of the work are often sub-contracted to local service providers, says the study.
And the growth of consortium deals, like the one used by the Royal Mail, means big outsourcers such as EDS will take a project management role but partner with smaller best of breed services companies with specialist knowledge of that particular sector.
Offshore suppliers are also being attracted by the growth in the UK public sector market.
The report said: "Offshore firms currently face political sensitivities linked to the loss of UK jobs as well as data security issues but attitudes are softening."
Quelle: silicon.com
