Tony Scott says IT spending 'headed the wrong way'

The state of IT spending isn’t making Tony Scott happy.

The federal CIO spoke pessimistically of how much the government was spending to maintain old systems, instead of investing in new ones, and he also dinged common acquisition practice as part of the problem even as he spoke Aug. 26 at the Digital Government Institute’s 930Gov event– an event organized around that very acquisition practice.

“930Gov, I’ve learned is a great symbol of what happens in the federal government,” Scott said. “I’m told, I haven’t been here for year end, but I’m told there’s tons of year-end spending because it’s a ‘use it or lose it’ sort of proposition, and that’s just a really bad way to run IT.”

The situation is “horrible,” he added, noting that “frivolous” spending abounds in September.

He backed away from his Aug. 11 comments that 80 percent of federal IT spending goes to operations and maintenance (O&M) of old systems, saying, “When I was speaking I wasn’t speaking with precision there,” although he doesn’t appear to have been far off.

In the Professional Services Council’s 2015 CIO Survey, federal agencies’ leadership estimated 75 percent of their IT spending was on O&M, with only 25 percent going to new systems development.

Scott declined to give an updated estimate of the spending numbers, saying that his office was in the process of looking at agency data and would be pushing out a public report within the next few weeks.

But while 80 percent may not be the precise figure, Scott is still concerned.

“I’ll tell you the trend, from the preliminary data I’ve seen, looks like it’s headed the wrong way,” Scott said. “And I don’t like that a bit.”

The phenomenon is natural, he added.

“This will happen naturally when you have the environment we have where budgets are constrained, CIOs are told, ‘cut costs, don’t spend more money and so on,’” Scott said. “Everywhere I’ve ever been, where the CEO or CFO or somebody comes into an IT organization and says, ‘We need to save money,’ CIOs know how to do this, they’re well practiced at it, and this is a natural human reaction. They cut the easiest thing there is to cut, spending on new application development and refreshing infrastructure.”

Cutting the things “you need to keep the lights on” is tougher, Scott noted, but there’s a sad irony in the whole situation because ultimately, investing in new tech brings savings in the long run.

He pointed to the example of his former employer, Microsoft, where “we got on a regular refreshment cadence” every couple of years. “What you realize is that every two years you can buy gear that’s twice as powerful for the same cost or less,” he said.

He discussed the possibility of encouraging regular federal hardware refreshes, and pointed to the Federal Information Technology Acquisition Reform Act as a possible engine for improvements in IT spending.

Agencies were required to file self-assessments of their FITARA work by Aug. 15. Scott said that he’d give the FITARA work he’s seen so far a “B+” grade.