£480bn of government revenue depends on "risky" legacy IT

Almost £480bn of the UK government’s operating revenues are dependent on legacy IT systems that “could present a very significant risk to public service delivery”, according to the National Audit Office (NAO).

The figure equates to about 90% of all central government income, and also presents a hindrance to the government’s digital strategy, which itself is aimed at reducing the dependence on ageing technology within Whitehall.

The NAO report, titled Managing the risks of legacy ICT to public service delivery, highlighted the risks to public services of such a huge estate of IT systems that have been superceded by newer, more effective technologies.

“The failure of legacy ICT would have a significant impact on government,” said the report.

“Legacy ICT reduces the flexibility to improve public services, makes it harder to protect against evolving cyber threats and increases government’s reliance on long-term contracts with large ICT companies,” it added.

“It is also likely to increase the cost of operating public services by preventing higher levels of automation and hinder data sharing intended to prevent fraud and error.”

Some of the UK’s most critical services are dependent on old technologies that predate the internet. The report cites HM Revenue & Customs (HMRC) and the Department for Work and Pensions (DWP), where tax collection and benefits payments are still reliant on VME mainframe systems supported by Fujitsu but developed by ICL in the 1980s.

The VME mainframes still operate in batch mode, which is “incompatible with a fully digital service” of the type the government wants to introduce.

“Business transformation, including the drive for digital transformation, is proving challenging for departments when it involves legacy ICT,” said the NAO.

“Legacy ICT is harder to adapt to meet changing business needs. We found that where an organisation has replaced its legacy ICT system, adaptability has increased.”

The NAO identified three strategies for dealing with legacy IT:

• No change
• Enhance and maintain
• Replace

In practice, Whitehall departments use a combination of these approaches, but the NAO found that civil servants “were not fully aware of the risks to their department posed by their legacy ICT”.

“Well-managed legacy ICT systems deliver continuity of service and suggest the lives of such systems can safely be extended,” said the report.

Well-managed legacy ICT systems deliver continuity of service and suggest the lives of such systems can safely be extended

NAO report

“Well-planned strategic investments have been successful in enhancing the functionality of legacy ICT, for example to improve customer service, while minimising risk to service continuity and reducing the full cost of service… In contrast, adopting a strategy of no change may impede organisational efficiency.”

Amyas Morse, head of the National Audit Office, said: “Legacy systems are a fact of life for most significant ICT users. The challenge is how intelligently they are managed, whether they are being retained, updated, replaced or phased out.

“The aim is to balance the costs of these options against the limitations and risks to ICT capability they can present, in a way that makes sense for the user and secures best public value. Performance in the public sector is patchy.”

Legacy IT systems also contribute to supplier lock-in, as many technologies in place can now only be supported by the original supplier.

The government's digital chief, Mike Bracken, told Computer Weekly recently that replacing legacy IT systems is an opportunity for smaller, more innovative suppliers to win business.

"The legacy has to be chopped up, which is an opportunity for SMEs. If I were an SME, I would be targeting the legacy infrastructure," he said.