G-Cloud will save £1.2 billion says John Suffolk, government CIO

The G-Cloud will help the public sector to standardise and simplify its ICT, saving it £1.206 million a year, according to the UK government’s CIO.

John Suffolk, HM Government CIO and CISO, told the SIIA OnDemand Europe conference in London today that the government would achieve these savings by 2014/15. These savings, attributed to the G-Cloud, are expected to grow to “about £4 billion a year cash” by 2019/20.

“Much of what we do is common and standard and simple, so we are absolutely ideal for a cloud-based model,” he said.

“Cloud computing is very important to us. The back end of a technology stack is a little irrelevant. The stack is not what I buy. I buy the outcome that I’m looking for.”

However, he warned: "If it is a lot of generic [services], put it in the cloud. If it is so specialist, leave it as it is."

Suffolk described the G-Cloud as a “shared common infrastructure for common systems”, that will operate with other clouds, and comprises the five “worlds” of hosting, testing, sharing, Web and SME.

For shared services, for example, the government could make savings by cutting data centre costs by simply hosting shared identity and authentification services, such as those for the Government Gateway or the Business Link portal, in the cloud.

“If we host them in the cloud, I immediately close six datacentres,” Suffolk claimed.

In addition, Suffolk envisaged a situation where SMEs, that do not have the necessary infrastructure, could buy access to the G-Cloud infrastructure, for example, for testing applications. Though he admitted that he had “no idea” whether small businesses would do this.

Other areas in which the government plans to make savings includes data centres, telecommunication networks and desktops. The public sector spends £16.9 billion on ICT a year with central government accountng for £7.1 billion (42 percent).

Suffolk said that central government has more than 8,000 tier one data centres, and more than 220 data centres from other tiers. Overall, the public sector spends £3.2 billion on data centres alone.

“If I could rationalise it down to nine to 12, we could save over £500 million per annum,” he said.

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“It’s not just an economical issue, it is an environmental issue and a security issue.”

In terms of telecommunication networks, Suffolk said that the public sector has “many more” networks in its data centres than the average amount of 35 networks per data centre.

“We could save up to £600 million per annum by being more local and by focussing standard processes and a standard approach to the telecommunications market,” he said.

According to the UK Central Government IT Benchmarking Study in 2005, from Gartner, the median TCO (Total Cost of Ownership) per government desktop was £2,300.

Suffolk believes that there is scope for the public sector to make cost savings in this area, for its approximately 5.5 million desktops, especially as “Gartner claims that best practice TCO is £1,800 a year”.

He said that by focussing on more standard designs and prices per component, the UK benchmark has fallen from £2,300 to £1,660, and that for each £100 saved per device per year, it is estimated the whole public sector could save over £500 million a year.

“There’s no money or profit in simplicity. The more you standardise, the more you automate, the more the money comes down,” he added.

Meanwhile, Suffolk said that the government will be addressing the fact that it takes up to 77 weeks for suppliers to bid for a government contract.

“SMEs can’t afford to bid. In my opinion, that stifles innovation.

“We are looking to reduce the number of procurements by saying that government is buying..., not one public body, because it is common to everyone,” he said.

This is in line with some of the memorandums of understanding that the government has recently signed with a number of large IT suppliers, in which it has agreed to make efficiency savings on some contracts by operating a single-client approach to procurement.

Although Suffolk said he did not have the “inside track” on what will come out of the government’s Spending Review tomorrow, adding that he did not expect the words cloud computing or app stores to be used. "The words will be different, but the outcome will be the same,” he said.