Skip to main content

IT firms earn more from government contracts than any other industry: HP bags almost £2bn

A report on public spending has found IT companies earned more from government contracts in 2012 and 2013 than any other industry.

Think tank the Institute for Government and startup business Spend Network looked into 38 million transactions involving 247 central and local government bodies during its investigation, but advised that some of its figures may be inaccurate.

Read more: Government Digital Services Framework spend totals £2.3m

Further verification is required to interpret the data fully, and the researchers, while praising the government’s decision to publish the information, felt that more details should be made public.

Gavin Freeguard, from the Institute for Government, said, "Cost is also just one part of contract transparency - government needs to be equally transparent about contract terms and the performance of suppliers funded by taxpayer money.

"We hope our analysis will prompt government to improve the quantity and quality of the data it shares so future analysis becomes ever-more accurate.”

The analysis also found that transactions were not evenly spread, with the top 20 firms receiving 20 per cent of government spending, despite the report covering in excess of 180,000 suppliers.

From these 20 firms, six are from the IT industry, with HP leading the way with takings of more than £1.7 billion in the previous two years.

Researchers have also called for the government to assist in removing flaws in the data. Currently, it is difficult to trace the exact sums paid for private finance initiatives (PFI) or joint ventures and the adoption of the World Bank’s Open Contracting data standard would improve the analysis, they said.

The report concluded that there was more that the government could do to aid transparency.

Read more: UK government goes open source with £200m Microsoft Office contract threatened

"Genuinely meaningful data on the value for money of government suppliers would allow citizens and civil society to hold government departments to account for their ability to manage suppliers and public service markets effectively,” it said.

"For this reason, there should be clearer obligations to... publish details of their performance against contractual obligations, which some providers and agencies already provide but many do not."