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Election 'knockback' predicted in IT market

12/01/15

Analyst predicts public sector IT market will see return to growth in 2016 after difficult year

UK sector IT market and Election 2015The public sector software and IT services (SITS) market will return to growth in 2016 after a 'knockback' caused by the general election this year, a leading industry watcher predicts. Analyst TechMarketView's Public Sector SITS Market Trends & Forecasts predicts that "2015 will be the toughest year" between now and 2017 because of general election purdah "as well as organisations postponing major decisions due to general uncertainty".

In central government spending will decline, while elsewhere in the public sector growth will be "subdued", the survey predicts. "The result will be a UK public sector SITS market that is worth £551m less in 2015 than it was in 2010 (in actual terms)."

Once the general election uncertainty is over, however, the survey predicts a return to growth of 1.7% in 2016 and 2.8% in 2017 as "public sector organisations across the board will realise that trying to make savings from the ICT budget - which is only a small proportion of overall spend - is no longer feasible".

Since 2010, "the low-hanging fruit has been picked", the study comments. "There is only so much that project cancellations, supplier renegotiations, and contract restructuring can achieve. At some point, you will find that you have 'trimmed all the fat'."

Public Sector SITS Market Trends & Forecasts, TechMarketView http://www.techmarketview.com

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