Where should cash-strapped public sector organisations allocate funds?

TS Eliot’s poem The Waste Land, pub­lished exact­ly a cen­tu­ry ago, begins with the words: “April is the cru­ellest month.” One hun­dred years on, con­sid­er­ing the exor­bi­tant rise of ener­gy costs for British cit­i­zens and busi­ness­es in April 2022, it’s hard to dis­agree. Unfor­tu­nate­ly, it appears worse is to come, with many feel­ing the world will end with a whim­per – so how can the pub­lic sec­tor cope?

On 5 May, the Bank of Eng­land lift­ed inter­est rates to a 13-year high and fore­cast that infla­tion would soar above 10% in the com­ing months, warn­ing that the surg­ing rise in liv­ing costs could plunge the econ­o­my into reces­sion this year. But it’s not only cit­i­zens who are squeezed; the pub­lic sec­tor is already in the red – just as demand for pub­lic ser­vices is like­ly to reach unprece­dent­ed lev­els.

The lat­est Office for Nation­al Sta­tis­tics fig­ures show that total pub­lic sec­tor debt stood at £2,344 bil­lion at the end of March 2022. This is equiv­a­lent to 96.2% of Gross Domes­tic Prod­uct (GDP), a lev­el not seen since the ear­ly 1960s.

Fur­ther, pub­lic sec­tor net bor­row­ing was £151.8 bil­lion in the year to March 2022. This was the third-high­est bor­row­ing fig­ure since records began in 1947, and is around 6.4% of GDP.

Giv­en this gloomy back­drop, how should pub­lic sec­tor organ­i­sa­tions plagued by mon­ey wor­ries invest in tech­nol­o­gy solu­tions that best serve strug­gling cit­i­zens? Grant­ed, cost­ly gam­bles on the meta­verse and van­i­ty projects are not a good idea right now, but what’s the best way to allo­cate funds?

Jon Crow­croft is a co-founder of iKVA, an arti­fi­cial intel­li­gence knowl­edge man­age­ment com­pa­ny, chair of The Alan Tur­ing Insti­tute, and Mar­coni pro­fes­sor of com­mu­ni­ca­tions sys­tems in the com­put­er lab­o­ra­to­ry at the Uni­ver­si­ty of Cam­bridge. He is well placed to answer these crit­i­cal ques­tions.

Investing in skills to address huge delivery challenges

“My advice would be to match the bud­get to the cur­rent skills base, or organ­i­sa­tions will face the chal­lenge of under­tak­ing a huge retrain­ing exer­cise that will over­whelm their resources,” he says. “Gov­ern­ment depart­ments such as trans­port, ener­gy and health­care are rel­a­tive­ly tech­no­log­i­cal­ly advanced and staffed by indi­vid­u­als who inher­ent­ly use tech­nol­o­gy for timetabling sys­tems, pow­er grid main­te­nance and data analy­sis. Com­put­ing is embed­ded into job roles in these depart­ments, par­tic­u­lar­ly in health­care.”

Oth­er areas, such as the legal sec­tor, have more lim­it­ed skills, Crow­croft says. Their rel­a­tive abil­i­ty should inform where addi­tion­al funds will be required to sup­port the deploy­ment of tech­no­log­i­cal solu­tions. 

Alex Case is pub­lic sec­tor indus­try prin­ci­pal at Pegasys­tems and a for­mer senior civ­il ser­vant at 10 Down­ing Street and the Cab­i­net Office, who recent­ly over­saw cross-White­hall Brex­it deliv­ery. He has also led large-scale pub­lic sec­tor reform ini­tia­tives in the UK and Cana­da – and is in no doubt of the scale of the task ahead.

“The gov­ern­ment con­tin­ues to face huge deliv­ery chal­lenges, from coro­n­avirus, Brex­it, the war in Ukraine or the cost-of-liv­ing cri­sis, includ­ing deal­ing with back­logs, dri­ving lev­el­ling up, get­ting the health ser­vice back on track, trans­form­ing social care and deal­ing with the safe­ty of tall build­ings. These need gov­ern­ment oper­a­tions to run effec­tive­ly and effi­cient­ly and for the least amount of cost pos­si­ble.”

Low-code soft­ware devel­op­ment uses drag-and-drop fea­tures instead of exten­sive cod­ing lan­guage to build appli­ca­tions. The result is that it is faster to com­plete and non-pro­fes­sion­al coders can use it. This makes it an excel­lent option to accel­er­ate inno­va­tion and reduce costs, sug­gests Case. Its uses across gov­ern­ment depart­ments could include stream­ing and improv­ing out­dat­ed and clunky cus­tomer ser­vice process­es, digi­tis­ing inef­fi­cient and com­plex pro­grammes and back-office process­es, and mod­ernising debt col­lec­tion while reduc­ing fraud.

“Low-code can rev­o­lu­tionise how gov­ern­ment designs and builds IT. It can help a busi­ness to get what it wants and needs from a new sys­tem, not the sys­tem the IT team thinks the busi­ness needs.”

Addi­tion­al­ly, he says this approach can bridge the fre­quent divide between busi­ness users, sub­ject mat­ter experts, prod­uct own­ers, and the tech­ni­cal design and devel­op­er teams.

Where, though, should the pub­lic sec­tor focus its invest­ment now? Crow­croft con­tends that it is less where and more how the mon­ey should be spent, cel­e­brat­ing the increased adop­tion of AI. “Dur­ing the pan­dem­ic, the pub­lic sec­tor suc­cess­ful­ly used AI and automa­tion to meet increased demand for ser­vices,” he says.  

“AI can auto­mate bureau­crat­ic process­es that are cur­rent­ly resource-inten­sive, reduc­ing the human work­load. This will offer cost-sav­ings, improve accu­ra­cy, and enable peo­ple to do oth­er things that have a pos­i­tive return for their organ­i­sa­tions, such as analysing data to iden­ti­fy where oth­er improve­ments can be made.”

An exam­ple of this is in the care sec­tor, says Crow­croft. By automat­ing some of the paper­work, the amount of time a care work­er can spend with peo­ple in need increas­es. “The process­es at the human lev­el are reflect­ed in doc­u­men­ta­tion, and that shouldn’t be the case any­more,” he adds.

One obvi­ous way for the pub­lic sec­tor to reduce costs is by being smarter with out­sourc­ing while improv­ing in-house skills. For instance, the val­ue of con­tracts award­ed by the UK gov­ern­ment and pub­lic bod­ies to con­sul­tants was £2.5bn in 2020–21, as organ­i­sa­tions used the pri­vate sec­tor to deal with the pan­dem­ic. 

“Con­sul­tants will always have a place in the pub­lic sec­tor,” con­cludes Crow­croft. “But using tech­nol­o­gy to unlock data insights and train­ing our peo­ple to under­stand the infor­ma­tion – will improve con­fi­dence in their deci­sion-mak­ing.”