Taxpayers on the hook over ‘dangerously outdated’ government IT systems
One in four government computer systems are running on outdated technology, a new report has found, with taxpayers having to pay more for failures across Whitehall.
The findings, published by Westminster think tank Re:State and supported by Ark Data Centres, reveal that nearly a quarter of the 319 central government systems assessed as of January 2025 are rated “red” — the highest risk category. This was up from previous assessments.
Around 15 per cent of public bodies cannot provide an accurate picture of their own legacy technological infrastructure.
The report warned that the Department for Science, Innovation and Technology (DSIT) has identified over £45bn in unrealised savings and productivity gains from ditching analogue systems in favour of a digital overhaul.
Half of all central government IT spending currently goes towards maintaining old legacy systems, while 28 per cent of high-risk systems have no repair funding at all in the case of a breakdown, according to the State of Digital Government Review cited in the paper.
Authors Laxshia Ganesharatnam and Joe Hill argued that systems — some dating to the 1970s, including HMRC’s COBOL platform and the Police National Computer — left the government more vulnerable to cyberattacks, costly outages and data loss.
The scale of financial damage when systems fail is laid bare in a case study on Guy’s and St Thomas’ NHS Foundation Trust, which suffered a major IT outage in 2022 after two data centres failed during a heatwave.
The trust identified 371 legacy systems and recorded approximately £1.4m in unplanned technology spending linked to recovery.
It reflects warnings made by the Office for Budget Responsibility last year that cyberattacks could lead to a surge in government borrowing to cover costs and protect services. The National Audit Office separately said 58 critical government systems were facing risks while hundreds of legacy systems lacked oversight.
Government money not ‘prioritised for tech’
The Re:State report called on the government to establish a dedicated taskforce within Government Digital Service (GDS), with a mandate to cut across departmental boundaries and tackle the highest-risk systems.
A funding model where DSIT co-invests in systems alongside departments was also proposed to accelerate any repair plans without removing departmental accountability.
Hill said: “The public don’t understand why their experience with government to book appointments and pay taxes are so much harder when they buy anything from the private sector.
“In Westminster the money doesn’t get prioritised for tech, and so behind the scenes successive governments have neglected to fix many dangerously outdated systems, leaving a ticking time bomb for future generations to defuse.”