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What trends and issues can we expect to see in the year ahead for the public sector?

Paul O’Sullivan
23 Mar 2023

2022 saw the UK emerge from the disruptive spectre of COVID-19, three Prime Ministers, the first full invasion of a European country for nearly 80 years, energy supply disruption, accelerating inflation, soaring interest rates, a spiralling cost of living, and widespread strikes.

2023 is likely to see a continuation of many of 2022’s characteristics, and after a challenging few years, the government is looking to accelerate economic growth and create jobs. To achieve this, the government plans to invest in infrastructure, innovation, and education, while supporting small and medium sized enterprises (SMEs) through possible tax breaks and access to financing. This will include investments in transportation, energy, and digital infrastructure, and inevitably due to geo-political pressures, the UK government will need to invest in defence and cyber resilience.

Here are the trends and issues we expect to see for the Public Sector in 2023.

The need to do more with the same or less

As always, there will be winners and losers, with many public sector budgets being put under pressure through budget reduction or spending power reduction via a combination of economic inflation and digital resource wage inflation. This pressure on government spend will lead to a number of reactions and approaches with productivity being key, leading to government and suppliers needing to do more with the same or less. Reprioritisation of policy and programmes, operating model convergence, technology platform consolidation, advanced automation, are all levers UK government will need to use to improve productivity and generate increased value for money within the budgets available.

Optimising digital operating models and next generation Application Management will be leveraged to reduce operational expense, improve efficiency, enhance user experience, provide better data management and increase security. Bringing together application portfolios from an operating model perspective will bring automation, economy of scale, and cost reduction opportunities that will help the UK government deliver more efficient, effective, and secure services to citizens and businesses.

The skills shortage will continue

The government will continue its efforts to tackle economic inequality and improve equal opportunity, leveraging its social value model to increase supply chain resilience, capacity and diversity. Investment in underrepresented geographies and demographics will lead to improvements in skills, diversity, and social mobility opportunities to help alleviate the situation. However, the skills shortage experienced in 2022 is likely to continue, playing into a “let’s do more with less” automation agenda, and may see innovative approaches to leveraging near-shore and off-shore delivery models provide security, cost efficiency and skills coverage. Modern technical controls, audit and security services allow for a greater granularity of security, enabling safe development and operation without compromise to data security. There are obvious exceptions to this within government and where off-shore and near-shore innovation is practicable, a cultural shift may still be needed.

Optimisation of IT and remediation of technical debt

Technology and platform consolidation and optimisation will also become a focus for some central government organisations. The huge investment from the government over many years into IT has led to a proliferation of technology and platforms. Whether this is cloud, development or data platforms, government will look to optimise their estates, increase standardisation, reduce licensing costs, modernise legacy and near legacy technology, and streamline operations. In addition to this optimisation, government organisations will look to identify, manage, and remediate the technical debt that exists within the application portfolio and technology estate.

Cloud services, tools and ‘everything as code’, alongside the integration of advanced technologies such as artificial intelligence and robotic process automation, will give government organisations hyper-automation opportunities. The identification and prioritisation of hyper-automation opportunities will become increasingly data driven, with data analytics and artificial intelligence being front and centre. Increasingly, AIOps technologies and practices will be used to further automate and improve the IT operations process.

Citizen engagement

The rollout of 5G broadband cellular networks, edge technologies, the increasing exploitation of IoT devices, and citizen identity services will provide the government with the fabric upon which to build our next generation of citizen facing services. The near ubiquitous adoption of mobile technologies and broadband technologies within the UK gives the government the opportunity to provide digital public services to citizens in an accessible and convenient manner.

Emphasis on cybersecurity

The UK government will place even greater emphasis on cybersecurity. With an increasing number of cyberattacks and data breaches, the government fully understands the importance of protecting its systems and data. This will include investments in new technologies and techniques to improve security, as well as the development of new policies and regulations to ensure that the government is protected against cyber threats.

Importance of big data and analytics

The UK government is also predicting that big data and analytics will play a more important role in its operations in 2023. This will include the use of big data and analytics to improve decision-making, as well as the development of new data-driven services and applications. The government is also looking to increase the use of data and analytics in the delivery of public services, with a focus on improving the efficiency and effectiveness of these services.


Another area of concern for the UK government is the environment. The country is facing significant environmental challenges, including climate change, air and water pollution, and the loss of biodiversity. The government is taking a proactive approach to address these issues, and has set ambitious targets for reducing carbon emissions, improving air and water quality, and protecting wildlife and ecosystems. Understanding the impact of IT systems on sustainability will become increasingly important, driving suppliers to innovate in both design and delivery to meet this increasing sustainability focus.

It is safe to say that we can expect to see another turbulent year for the Public Sector. Making progress on key investments and helping businesses financially will be the top priorities for the UK government, as well as focusing on improving cybersecurity and data resilience. 2023 will pose many challenges for government, however there is an opportunity to make real positive change by helping it turn its plans into action.

Please click the link below to read more from our 2023 prediction series

Paul O’Sullivan

Chief Architect of the Capgemini UK Public Sector Market Unit
Paul is an experienced Chief Architect within the Public Sector Market Unit in the UK. With over 25 years of experience in architecture and delivery across various sectors, he has specialised expertise in the UK Public Sector. As the Chief Architect, Paul ensures that client solutions align with business strategy and objectives. Additionally, he provides guidance and oversight to ensure the successful delivery of these solutions, ultimately leading to positive outcomes for clients.