After five years and several billion pounds of investment, electronic government is within sight of turning a crucial corner.
Phil Hope, the minister for local e-government, said last week that from April 1 next year, English councils will save more from new IT-enabled processes than they will spend on the technology.
The calculation contains some small print. In 2006-07, councils will be running e-government at a profit only in the sense that British Airways ran Concorde at a profit: the balance sheet ignores millions of pounds spent upfront on hardware and software. Also, not every local authority will be in profit by that year. Finally, not all the efficiency savings will be "cash releasing" - in other words, council tax bills will not necessarily fall as a result.
The efficiency figures come from the latest annual returns filed by every English council to claim a central subsidy for "implementing electronic government".
The returns show many councils - which run about four fifths of all public services - to be pioneers of e-government. "In over 100 councils, citizens can already go online to submit planning applications, check their council tax balance and calculate their benefits entitlement," Hope said.
The UK's 468 councils are supposed to have all their services "e-enabled" by December 31. (Councils in Scotland and Wales have the same target, but are funded differently.) The returns, submitted in November, show that, on average, English councils are 79% of the way there. They expect on average to be "98% e-enabled" by December. This is two percentage points ahead of central government - the Cabinet Office e-Government Unit expects 96% of central services to be available electronically by the end of the year.
Some councils are struggling, however. With just over nine months to go to the target, 59 English authorities, 15% of the total, have referred themselves for additional assistance. This is "broadly in line with expectations", the Office of the Deputy Prime Minister said. It did not name names.
Although central funding for e-government runs out this year, Whitehall shows no sign of letting up its pressure on councils to modernise their services through IT. The buzzword is sustainability - after this year, e-government projects are expected to pay their own way. This also feeds into the government-wide efficiency drive launched by the Treasury last year.
Hence the new emphasis on efficiency. Hope said that, this year, councils will make gains of £121m as a direct result of investment in local e-government. For example, East Riding council in Yorkshire has cut the time taken to process assessments for home care from 24 days to one day. The result, said Hope, is that "some of the most vulnerable members of the community are receiving their benefits more quickly, staff have less bureaucracy to deal with and council taxpayers benefit from a more efficient service". Norwich City council, meanwhile, has made its parking wardens 10% more productive by issuing them with handheld computers.
By 2007-08, these cumulative savings across the whole of local government will add up to £1.2bn, the Office of the Deputy Prime Minister said.
E-government experts had mixed feelings about the figures. "It's a terrific step forward to measure the efficiencies that e-government will bring local authorities," said Alexander Stevenson, director of specialist consultancy RSe. "But the basis for this calculation needs to be far clearer than it currently is for the numbers to be genuinely robust."
One problem is that savings figures are based on estimates produced by local authorities themselves and are subject to different local political priorities. Some authorities, such as the London borough of Westminster, are happy to predict big net savings: £2.86m in 2007-08. Others are less inclined: the borough of Hackney, a near neighbour in location if not in affluence, expects to be making a net spending of £6.9m in that year.
Some of the most experienced local authorities are cautious about predicting efficiency gains. The borough of Tameside, in Greater Manchester, which two years ago claimed to be the first local authority to have all its services e-enabled, will not move into profit until 2006-07, no sooner than many tardier authorities. Another pioneer, Bracknell Forest in Berkshire, expects to be still running at a loss in 2007-08. The small print of its electronic government statement notes soberly that: "Anticipated future savings are indicative only. It should be noted that improvements in services brought about by e-government are difficult to quantify in financial terms."
However, Hope, speaking to an audience of council leaders, stressed that e-government is not just about money. "At heart, it is all about new ways of doing things, listening to and working more closely with citizens, shaping services around their needs and delivering for local communities."
