Lawmakers’ concerns about soaring prices and dwindling negotiating strength with large IT companies are putting increasing pressure on the UK government to change its cloud procurement policy. Departmental fragmentation in cloud purchasing has made it harder for the government to negotiate lower prices, officials said during a recent Public Accounts Committee (PAC) meeting.

Andrew Forzani, Chief Commercial Officer at the Cabinet Office, emphasized that departments must align their cloud requirements to maximize government spending power. He acknowledged that it is still difficult to achieve this alignment. A limited number of leading cloud providers control the market, making it challenging to negotiate advantageous terms.

The problem gained attention because the Home Office recently signed a £450 million contract with AWS, which was a substantial increase from its prior £120 million agreement. “Does the Home Office actually know what it needs?” said Labour MP Lloyd Hatton, who questioned if the Home Office was getting value for money.

In order to address these inefficiencies, the government established a Digital Commercial Centre of Excellence (DCCE) using AI-powered technologies to identify procurement faults and improve coordination.

According to Forzani, the DCCE would give coordination of cloud purchasing strategies top priority, enhancing initiatives to avoid vendor lock-in and ensure departments make informed decisions before signing contracts.

Dealing with tech behemoths is not a novel problem. Vendor lock-in has undermined the government’s ability to negotiate cloud agreements, exposing departments to restrictive contracts and rising costs, according to a Cabinet Office assessment last year.

Permanent Secretary Cat Little stressed the need for stronger “intelligent client functions” within government, pointing out that unclear specifications and weak oversight often lead to costly procurement failures. She called for better sharing of lessons learned across departments to prevent future mistakes.

A National Audit Office (NAO) audit supported these concerns, noting that the government lacks both technical assessments of cloud contracts and sufficient digital expertise. Unexpected complications frequently surface after contracts are signed, making them challenging to address without expensive revisions, the research cautioned.

PAC Chairman Geoffrey Clifton-Brown did not mince words, stating that the government’s poor handling of digital procurement had led to unnecessary delays and wasted taxpayer money. He urged stronger central oversight to ensure departments act as “intelligent clients” rather than relying solely on vendors to dictate terms.

The question still stands as the government attempts to revamp its cloud procurement strategy: will departments continue to function independently, increasing expenses in a public budget already under pressure, or can it unify its policy and fight back against digital behemoths?