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UK Taxpayers' Money Getting Wasted On IT Spending
hypnosec writes "A report combined by MPs has claimed the UK government is spending 'obscene' amounts of taxpayers' money on IT. The Public Administration Select Committee revealed in its report that some government departments have spent £3,500 on a single desktop PC, which can be purchased for as little as £200. Some other examples of the government pouring public money down the drain include buying copier paper for £73 when it can be purchased for £8."
About that £3500 PC...
The media reporting this story appear to be doing a good job of ignoring what that £3500 PC actually is: three years of PC, with software licensing, hardware replacement, upgrades, maintenance and support. It's not just the bare metal put on someone's desk but the full service behind it.
If you take the IT budget for a large healthcare public sector organisation and divide it by the number of desktop PCs they support, it'll probably come out at around £1000/year.
I'm not denying that some money is being wasted, but nowhere near as much as this report implies. See this article for more detail.
the summary mentions the £3.5k, but with a slightly different context than TFS.
Given the cuts that they are having to make in response to the fiscal deficit it is ridiculous that some departments spend an average of £3,500 on a desktop PC.
is this with or without software? add a Citrix licence, SAP access, some security token with a user licence, MS Office, AD user access licence, ... and it is at least thinkable that one workstation is expensive as hell.
While I have no doubt that some departments are letting themselves get raked over the coals(or taking kickbacks, better check on that), and that someonebody has been seriously drinking the kool-aid when it comes to the 'efficiency' of contracting everything, I am annoyed by the example being cherry picked:
A £200 computer is, what, the low-end consumer model on the shelf at limey-Best-Buy? Oh, that'll make perfect sense as part of an enterprise IT system, once we've quadrupled the RAM, upgraded the OS to something that will bind to AD, factored in the cost of Office and whatever horrid application specific cruftware holds the department together, and doubled up on screwdriver monkeys because the hardware that gets thrown into that model changes only slightly less often than the serial number does...
It's just the hidden extra terrestrial tax
You don't actually think they spend $20,000.00 on a hammer, $30,000.00 on a toilet seat do you?
I doubt it. Apple is not on the list of approved suppliers for most UK government departments. In a lot Dell is the only option, and their government price list is insane: at least double their web price for exactly the same equipment. Even if this includes a support contract, it would still be cheaper to buy the cheap version and just throw it in the bin and buy a new one if there's a problem. Spending £3500 on an Apple desktop would mean a 12-core 2.66GHz Xeon - I'm pretty sure you can't get that for £200 elsewhere, since it has two CPUs that retail for over £500 each (although the rest of the specs on that machine are pretty anaemic for the price: only 6GB of RAM and a single 1TB disk? WTF Apple?)
I am TheRaven on Soylent News
It is "stolen". Usual scheme, where cronies get to charge insane amounts of money for something, then split the cash with person who set the deal up.
Is http://www.pcpro.co.uk/blogs/2011/07/28/obscene-whitehall-it-spending-or-sloppy-journalism/
Basically, they took something out of context and sensationalised it.
The outsourcers are evil. Pick any of the 3-letter acronym usual suspects and there's a great chance it's the one I personally know charged £8000 to write 1 line of SQL.
Sounds like someone is buying too many 'shiny' Apple products.
Although I like a mac as a computer, they are ridiculously expensive...
...but £3,000 plus for a desktop is madness, even if it was apple!
It probably was only 8 pounds for the paper - the other 65 pounds was re-directed to the MP's pocket (either directly or indirectly.)
Well moat cleaning and duck houses are not cheap, you know!
isnt this money just going around the system anyway? so yes, it maybe seen that the government spend OUR tax money on things they could get cheaper.. but at the end of the day, public sector is encouraged to puchase from local suppliers. arent we then talking about local suppliers receiving tax payers money for goods and services, which in turn creates jobs and wealth? if they cut back and spend less, doesnt this create new problems?
Well moat cleaning and duck houses are not cheap, you know!
I didn't know. I have people to keep track of stuff like that for me. Perhaps you're one of my employees?
rewriting history since 2109
You don't actually think they spend $20,000.00 on a hammer, $30,000.00 on a toilet seat do you?
Ten years ago I was being taught about the attempt to upgrade the London Ambulance Service's systems, as a notorious failure and how it could be avoided. The government has not learned: http://www.theregister.co.uk/2011/07/01/auditor_says_firecontrol_a_disaster/
shocked, I tell you, that people would spend money that's not their own so freely.
"National Security is the chief cause of national insecurity." - Celine's First Law
However, as our report from the 13 May states: “The bottom line might make it look like Cabinet Office workers are all sitting in front of the most ridiculously expensive machines in Britain, but officials played down the figures, saying they covered more than just the hardware. According to a Cabinet Office spokesperson, the “costs cover the core infrastructure and applications – basically anything supplied by a third party’.”
(Read more: “Obscene” Whitehall IT spending or sloppy journalism? | PC Pro blog http://www.pcpro.co.uk/blogs/2011/07/28/obscene-whitehall-it-spending-or-sloppy-journalism/#ixzz1TUbtZD9C)
Sorry Sir, I'll get back to polishing the silver in a minute, but in case the references were missed...
Moats Ducks
The outsourcers are evil. Pick any of the 3-letter acronym usual suspects and there's a great chance it's the one I personally know charged £8000 to write 1 line of SQL.
Was it a really, really long nested query? :)
Then again, the mechanic isn't paid because he has a hammer, but because he know where to hit...
Let me break it down , there's two possible reasons.
One , as other readers have suggested , the article might be purposely omitting various facts or mixing up total cost of ownership with purchase value.
Two , it's not that the buyers were stupid , they might be to some extent (not knowing the market well enough to shop around for the best deal) but that doesn't cover such a deep discrepancy.
Most often than not , at least in the ex soviet block , these things are done to take money away from the institution. The buyers just agree with the sellers to up the cost dramatically and get a part of that money back as incentive to do it. And these things happen ALL THE TIME , in all corners of all public institutions. That's why these states are doing so poorly , budget wise. It's called corruption.
This may come as a shocker to you if you were brought up in some place where these are not common day activities. Criminal penalties should be enforced against such wrongdoers.
I can not emphasise enough , this is the kind of stuff that brings a nation down , one expensive toilet seat at a time.
Sounds like someone is buying too many 'shiny' Apple products.
Not at all. They are buying windows PCs from approved suppliers. Getting approved requires an almighty mass of paperwork that would crush any normal company. The only companies that will deal with the UK government are experts at government bureaucracy first and IT suppliers second. They know that once they have made it onto the approved list they have very little competition so can charge well over the odds.
some government departments have spent £3,500 on a single desktop PC, which can be purchased for as little as £200.
So they're using iMacs ?
Sounds like someone is buying too many 'shiny' Apple products.
Although I like a mac as a computer, they are ridiculously expensive...
...but £3,000 plus for a desktop is madness, even if it was apple!
500 UKP computer.
2450 UKP extra costs incurred by dealing with the UK government's self-serving bureaucracy.
50 UKP delivery.
In fact, the worst cost offenders in both areas are not the IT/facilities providers and the supply companies; they are the end users who buy inkjets and run them on petty cash.
My own GP is very clued up in this area and keeps a close watch on the local trust to see if they are getting good value for money. Generally speaking, they do. In fact, compared to privatised healthcare in the US, the NHS is amazingly efficient and low cost - which is why we have very similar life expectancy adjusted for social class, but we only spend half as much of our GDP as does the US - and our GDP per head is lower to begin with.
From scarped cliff or quarried stone she cries "A thousand types are gone, I care for nothing, no not one."
Yes, do so agree, at London borough [district probably in the US] level, perfectly adequate PCs are 'refreshed'/dumped because 'they' don't know how to manage viruses, huge roaming profiles etc. etc. the next-door borough nearly went to Linux and then backed away. Without being an open-source nut, this would certainly be a healthy part of a solution. We already believe in 'mixed' economy don't we, so this isn't much of a reach.
On y va, qui mal y pense!
Better for tax money to go to frivolous IT spending than have it wasted on senseless wars.
The main areas of waste are simply large infrastructure projects that are badly designed by unqualified Civil Servants with unrealistic and underspecified objectives, which are then divided up among too many contractors with too many legal interfaces between them, and then have to be repeatedly redesigned and reimplemented as the scope changes. It is like our national habit of building motorways that are too small, and then having to pay more to widen them than the original building cost.
The cost of PCs and support is utterly irrelevant in this. It is the way in which, say, it can cost nearly £30000 in legal fees just to have one contractor run a wire between two boxes operated by different contractors, because the scope of contracts has to be changed.
The answer is a radical reform of the Civil Service to ensure that anybody involved in an infrastructure project is actually qualified in the right areas, rather than having graduated from Oxford with a classics degree thirty years ago. But every attempt to reform the Civil Service is handled internally - good luck with that.
From scarped cliff or quarried stone she cries "A thousand types are gone, I care for nothing, no not one."
Hey!
Its good to know that its the same back in the UK as it is in other parts of the Empire.
I know a bunch of people in Canada who have made a living buying computers from retail stores and reselling them to government.
In one case I know they were buying corporate cast-offs and refurbishing them and then selling them to government. Computer cost $100, Upgrades to meet government specs: $90. Chargeout price: $1800.
Really? I'm sure I hear of several departments talking about iPads. Or is this just a specific list of suppliers for desktop computers?
Well its not like the money not spent on IT all goes to good use.
If you're going to troll, at least put a little effort into it. That didn't even raise an eyebrow.
Open source.
Er, that's two words.
So, two words...open source and freedom.
To have a right to do a thing is not at all the same as to be right in doing it
Sounds about right, similar things happen in the US. When my father in law was in the naval reserve he noticed that there was a specification for ketchup and that when more was received there was associated documentation to ensure that what they actually received was actually ketchup by the official US government specification. I guess some of this has changed in recent years but I gather that a lot of it still happens.
Time to offend someone
President Thomas Whitmore: I don't understand, where does all this come from? How do you get funding for something like this?
Julius Levinson: You don't actually think they spend $20,000.00 on a hammer, $30,000.00 on a toilet seat do you?
~Syberz
... They know that once they have made it onto the approved list they have very little competition so can charge well over the odds.
Often, once they are on the list there is no competition! I'm not sure what the Approved Supplier List is supposed to do, but it sure as hell doesn't guarantee price or performance! Strikes me it's just a boondoggle to encourage back handers, 'cos there's precious little else to recommend the practice!
Eclectic beats from Leeds, UK
handmadehands.co.uk
Meh, it's similar in the US gov't & defense contracting sector, mostly for tax reasons.
For a largish contractor, if a PC is purchased for under $3000-$5000, it comes out of the expense budget, which tends to be relatively low year to year. If it's over that amount, it can come out of the much larger capital budget, which tends to be much bigger, and the company can take tax breaks for depreciation of that equipment over 3-5 years. So to the bean counters, it's much more desirable to have stuff come out of the capital budget, even if they are 3-10x overpriced. It also goes on the books as something that makes the company look like it has "capital resources", instead of sinking money into "expenses".
It's been funny to see computers overspec'd to cost $3k-$5k... usually through some combination of overpriced nVidia Quadro GPU (which can get up into the $1000s, but at least you can still buy the same outdated model number for a couple of years), 12-32GB+ RAM in 32-bit systems, RAID adapters that are never configured or used, loaded up with extra disks that might get pulled and stored in a pile elsewhere so they don't have to be bought individually separately (and often for cheaper when not bundled with an OEM's equipment build).
The other magic number is something like $200,000 for a single purchase or system of computers, so you'll see lots of the big iron companies dish out a rackfull of product for about that amount, like EMC storage etc. when there's stuff like NetApp that does the same thing for maybe 10% of the cost. So if the IT department can plan ahead enough, they can make a large purchase of cheap PCs for over $200k and still depreciate them, which is why the desktop/laptop you actually get to use is still a piece of crap. But the computers that can't be planned and spec'd a year in advance get to cost way more.
Member of Parliment (sort of like a Senator/Representative in the UK)
Any person using FTFY or editing my postings agrees to a US$50.00 charge
Although the money doesn't go directly to the politicians, some of it often ends up indirectly benefiting them or their relatives.
I am not excusing what British MPs were up to - but by world standards, and US standards, they weren't even trying.
From scarped cliff or quarried stone she cries "A thousand types are gone, I care for nothing, no not one."
I am TheRaven on Soylent News
Members of Parliament in this context.
I have seen with my own eyes, a government department that uses a company for all their IT needs, and that company needs to fill out a form every time you need to purchase a mouse, those forms and paper trail end up costing about 100$, for an 8$ mouse.....seriously, when no one is watching how you spend the money, anything goes, but tell these same people to pay 100$ for a mouse at home , they would freak!!!
i have someone to click links for me.
rewriting history since 2109
The inevitable review and response to this scare story will produce a series of reforms which will increase these costs by introducing more "accountability" steps that increase the admin overhead. One of the main justifications for these single-supplier procurement deals is that they are necessary to comply with regulations on competitive tendering and other "lets fix everything" laws.
In a survey of 100 programmers, 111111 thought that duck-typing was a good idea.
Some plonker comes along and demands to know why IT resources cost so much more than the crap he can buy at Best Buy. If said plonker has any pull at all, everyone gets all worked up for a while and plans are made to pilot a program to just buy all our shit at Best Buy and avoid the costs. Then people start looking at bringing hardware reliability up to corporate standards, retaining extra employees to do away with "expensive" support contracts and licensing software. Then, for some bizarre reason, the project quickly and quietly dies, is buried and no one ever hears about it again. This usually wastes more money than is actually being "wasted" with the "expensive" desktop machines we're using.
I'm trying to teach myself to set people on fire with my mind... Is it hot in here?
If it's really that much work to deal with the paperwork, then I can't even blame them for charging more. Makes sense to have the customer pay for his own silly paperwork, doesn't it? So the real news is that bureaucracy is raising IT costs to an unreasonable degree.
Imagine a pallet of florescent lightbulbs being scrapped. Somehow in accounting they were sent to the wrong facility.
Its logistically cheaper to scrap an entire room than try and salvage anything out of it. I'd dig through the scrap bin and find... you name it.
-
Although I'd rather waste 3x on the costs of a PC than $0.50 on the costs of killing brown people.
It seems wasteful to be spending taxpayers money on proprietary operating systems and expensive word processing applications when there are perfectly good free equivalents.
Phillip.
Property for sale in Nice, France
500 UKP computer.
2450 UKP extra costs incurred by dealing with the UK government's self-serving bureaucracy.
50 UKP delivery.
It's GBP - for Pound Sterling. Admittedly not as intuitive as one would first think (Great Britain Pounds? No).
People still use Dell?
I work for an agency here in the states and we are a Dell shop. Dell likes to charge $700 for a system bragging they they gave us a $200 discount on a $900 machine that is actually worth $300. The biggest problem we have in our shop is that we don't have an IT budget. All It procurements are made from the general or individual funds and the IT director just rubber stamps many of them just to keep people happy. There is a bigger problem though with the industry in general in that IT people are often not in charge of IT departments, business people are and they don't know shit about computers or what a good deal is so they let companies like Dell give them a big pile of crap deal while getting their ego's massaged and pockets filled.
I got here through a series of tubes
I work for a government organization, and we have all Dell workstations. They have special government pricing that allows us to buy without going to tender (tender is basically already done and Dell won the bid for a given time). The price is very good, and their support and warranty has been great. I can't speak for others, but we certainly still use Dell.
That's something new!
The horror stories don't actually apply to most of the UK. They tend to apply to areas which are overpopulated with excessive house prices, i.e. London.
From scarped cliff or quarried stone she cries "A thousand types are gone, I care for nothing, no not one."
Ha.. you are not just whistling Dixie there..
Imagine the horror I was in when I showed up for work to find 30 E-machines with windows Vista home premium on them and was told to connect them to the domain and start replacing the secretarial computers. I guess "a deal" is a deal regardless of how much of a downgrade something might be or extra costs might be associated with making it work.
Yes, I have ran into the same problems with the head of IT not being an IT person. the most painful part of that is that the volume licensing contract was purposely let to expire when windows XP was all the rage because "Every computer comes with it's own operating system, we don't need to pay for it again".
I guess that's what happens when the major qualification for a management position is being related to an owner and there is a family tree involved that doubles as a telephone pole.
My last employer had a Dell contract. It's more than just the cost of machines, it covers the cost of replacement of whole batches of PC. Our technicians used to do PC swapping if anyone's PC did go bad. They did basic component swapping (monitors, memory chips, graphics boards, CPU's) to repair things, anything else like power supplies or motherboards would just be sent back to Dell. Maybe once a month, they would have handful of Frankenbox broken PC's and monitors left.
Vintage computer adverts: http://www.vintageadbrowser.com/computers-and-software-ads
Oil companies in Scotland used to do that in the 1990's at least. The local computer club alway had stories of engineers and consultants visiting their sites on commerical business, and seeing large refuse skips filled to the brim with PC's, coaxial cables (The original yellow and blue LAN cables), ribbon cables, monitors and PC chassis. All perfectly functional, but the companies always wanted to have the latest technology.
Vintage computer adverts: http://www.vintageadbrowser.com/computers-and-software-ads
Leaving sad and unimpressed.
I had a sig, but
Sounds like another variation on this: http://www.snopes.com/business/genius/where.asp
(loses something in translation from the original Latin)
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
Thanks for the link to the PC Pro article, it's very interesting and personally I felt you left out it's most interesting point:
Regretfully having read much of the report, the above is a good example of how worthless it is. PC Pro rubbishes poor media coverage of a government report, then another government report quotes PC Pro and uses the figure in exactly the wrong way that PC Pro was complaining about in the article the report is citing!
Admittedly the report does refer once to "median total cost of ownership", but either they failed to understand what that meant or failed to communicate the meaning in the report. Read para 16 & 17.
It's a very poorly written report, irritating to read and lacking in professional verse. While they appear to have sourced widely, assertions are made in the form of regurgitations of other's material, and throughout those sources are often very poor. There's no sense that they explored any of these sources in depth, let alone went into the field and investigated for themselves.
This is a pity partly as it attempts some very interesting topics and partly because a group of people running the country can't write a decent report.
As someone whose worked in UK public sector, I can tell you it's likely a bit of both.
I worked in IT for education, and it was not uncommon for £350 PCs to be bought at around £1500, and maybe £700 or so of software on top that would never be used.
I take issue with this:
"but itâ(TM)s ludicrous in the extreme to suggest â" as the Daily Mail does â" that the Cabinet Officeâ(TM)s IT department could pop down to its local branch of Dixons, buy a batch of £250 budget desktops and be none the worse for it."
I think it's unfair to write this point off- warranties will be included with such systems, as will the Windows license, sure they'll have to buy Office on top, and there are support costs too, but chances are you can still make it all come in at well under half the £3664 figure by buying, not necessarily from Dixons or anywhere, but directly from a supplier and bypassing the "approved government IT supplier" bullshit which was basically just code for "IT supplier someone in the government has a vested interest in".
Just to illustrate this point a little further, as part of a major programme to get laptops into schools, we had to evaluate a number of suppliers (this was some years back now) Dell was chosen in the end, for a contract of 3000+ laptops, with a combination of the bulk volume discount and an education discount they could be bought for £675 without VAT. Problem is, they could be bought by a home user directly from Dell's site for £500 with VAT, however this wasn't an option, because we had to buy through the approved agreement.
Fact is, public sector does grossly overpay for things, and a lot of the time it's because public officials are biased towards some company and so setup absurd agreements- whether it's that they directly have shares in the firm, or whether they just fancy the sales lady, I've seen it all.
Of course, even outside the per-system costs there are bigger savings to be had, my local council just went straight into a massive Microsoft contract without even investigating alternatives such as FOSS, and without trying to bargain Microsoft down by saying well look, we can do it cheaper with FOSS... nope, they just signed the contract and spent a few million tax payers money, all because the head of IT was a little too friendly with the Microsoft sales exec.