IT spending to jump, survey says

IT spending to jump, survey says

Federal IT spending will rise by 15 percent next year, and the Sept. 11 terrorist attacks have changed the government's priorities for how to spend the money, an industry trade group survey showed.

Agencies will spend a total of $49 billion on IT in fiscal 2002, representatives of the Government Electronics and Information Technology Association predicted this month. IT security and wireless telecommunications are taking precedence in budget plans, they said.

The civilian and defense sectors will split the IT funds almost equally'$24.2 billion and $25 billion, respectively. About $2.5 billion of the civilian spending is for processing electronic transactions, said Mary B. Freeman, federal market research manager for Verizon Communications Inc.

Also, the Defense Department has reclassified some of its command and control funding for next year as IT money, Freeman said.

By fiscal 2007, the annual federal IT budget will soar to $65 billion in today's dollars, according to the GEIA forecast. That represents a compound annual growth rate of 5.6 percent, Freeman said.

In just one year, the government has gone from 'a surplus we didn't know how to spend' to deliberate deficit spending, Freeman said. The trend started before the attacks on the Pentagon and World Trade Center but has since accelerated, she said.

GEIA representatives had largely finished their annual survey of more than 275 agency officials, congressional staff members and Wall Street analysts when the attacks took place.


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