recommended reading

Most federal IT funding expected to escape super committee's knife

Agency technology spending should be able to withstand the outcome of any super committee deal as well as steeper cuts if deficit reduction negotiations collapse, information technology industry groups say.

While feds worry their pay and benefits may take a hit, IT contractors expect lawmakers to preserve substantial funding for replacing decades-old hardware and software and securing networks.

"We are one of the leading sectors. We have been throughout the recession," said Trey Hodgkins, senior vice president for national security federal procurement policy at interest group TechAmerica. "The need for technology, whether it's refreshments or cybersecurity, those needs don't go away, and in some ways they may increase."

The bipartisan super committee has until Nov. 23 to provide Congress with a $1.2 trillion package of budget savings. Currently, the Obama administration is preparing fiscal 2013 and 2014 spending proposals that Hodgkins said may shave off between 10 percent and 20 percent of agency IT budgets. The deficit deal or lack thereof could further trim companies' government sales, he said.

The retrenchments, however, likely will spare IT investments anticipated to save money long term, such as health IT, Web-based cloud computing and cybersecurity, he said.

"The reality is the government still does not have sufficient workforces in many skill sets," which require private sector support, Hodgkins added. "There are some bright spots for the government sector in tech spending, despite the impending cuts in 2013 and maybe the super committee cuts."

It is unclear whether the financial unknowns are prompting tech firms to pull out of the government space.

"If there were to be cuts into discretionary funding that trickle into the government, that's obviously going to affect hardware and software providers," said Liz Hyman, public advocacy vice president for CompTIA, a trade association for IT companies. "It's already so hard for small and medium-size companies to participate in contracting, that there are a lot of question marks out there."

Congress resolved one uncertainty in contractors' favor Wednesday night by clearing a measure to repeal a 3 percent withholding tax on federal suppliers. The law was set to take effect in 2013.

Officials with the Software and Information Industry Association, which represents cloud providers, said, surprisingly, they are not getting calls from members concerned about the super committee's impact.

Firms are saying, "It's so far out of our hands. They are going to do what they are going to do," SIIA Public Policy Director David LeDuc said.

Threatwatch Alert

Thousands of cyber attacks occur each day

See the latest threats

JOIN THE DISCUSSION

Close [ x ] More from Nextgov
 
 

Thank you for subscribing to newsletters from Nextgov.com.
We think these reports might interest you:

  • Modernizing IT for Mission Success

    Surveying Federal and Defense Leaders on Priorities and Challenges at the Tactical Edge

    Download
  • Communicating Innovation in Federal Government

    Federal Government spending on ‘obsolete technology’ continues to increase. Supporting the twin pillars of improved digital service delivery for citizens on the one hand, and the increasingly optimized and flexible working practices for federal employees on the other, are neither easy nor inexpensive tasks. This whitepaper explores how federal agencies can leverage the value of existing agency technology assets while offering IT leaders the ability to implement the kind of employee productivity, citizen service improvements and security demanded by federal oversight.

    Download
  • Effective Ransomware Response

    This whitepaper provides an overview and understanding of ransomware and how to successfully combat it.

    Download
  • Forecasting Cloud's Future

    Conversations with Federal, State, and Local Technology Leaders on Cloud-Driven Digital Transformation

    Download
  • IT Transformation Trends: Flash Storage as a Strategic IT Asset

    MIT Technology Review: Flash Storage As a Strategic IT Asset For the first time in decades, IT leaders now consider all-flash storage as a strategic IT asset. IT has become a new operating model that enables self-service with high performance, density and resiliency. It also offers the self-service agility of the public cloud combined with the security, performance, and cost-effectiveness of a private cloud. Download this MIT Technology Review paper to learn more about how all-flash storage is transforming the data center.

    Download

When you download a report, your information may be shared with the underwriters of that document.