Last week, technology analyst Ovum revealed that 35 public sector outsourcing contracts could be renegotiated in the coming years, as the government has announced a £100 million cap on spending for each project in this area.
Michael Dean, head of marketing at the National Computing Centre, commented: "If the government takes a hardline approach through either non-renewal or renegotiation, outsourcers will be forced to find alternative revenue streams in a market which, according to recent reports, is in decline."
In addition, the expert claimed that outsourcing providers may attempt to mount legal defences to government attempts to renegotiate their contracts, which could lead to delays in the services that are reliant on them.
The Ovum research suggested that not all the 35 contracts valued at £100 million or more will be severely changed, but there is enough scope in the proposals for the government to make significant cost savings.
Michael Dean, head of marketing at the National Computing Centre, commented: "If the government takes a hardline approach through either non-renewal or renegotiation, outsourcers will be forced to find alternative revenue streams in a market which, according to recent reports, is in decline."
In addition, the expert claimed that outsourcing providers may attempt to mount legal defences to government attempts to renegotiate their contracts, which could lead to delays in the services that are reliant on them.
The Ovum research suggested that not all the 35 contracts valued at £100 million or more will be severely changed, but there is enough scope in the proposals for the government to make significant cost savings.
