• Government Accountability Office
     Government Accountability Office

Data Center Consolidation Nets Big Federal Savings, GAO Finds

October 6, 2015
By Sandra Jontz
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Overall, agencies save $3.6 billion from IT reforms.

The tally is in and the news is mostly good: The federal government saved about $3.6 billion over a three-year period by implementing information technology reforms set in motion by the Office of Management and Budget, or OMB.

Between fiscal 2011 and 2014, agencies netted about $2 billion of the total from data center consolidation and optimization efforts alone, according to the Government Accountability Office (GAO), the investigative arm of the U.S. Congress.

“Notably, of the $3.6 billion total, the Departments of Defense, Homeland Security, Treasury and the Social Security Administration accounted for about $2.5 billion,” reads a portion of the report.

The progress, though, is but a mere beginning in the potential of cost savings and cost avoidance. For starters, most agencies have yet to fully meet OMB's requirements to submit reinvestment plan information, the GAO investigators note. Of 27 agencies required to present plans, only five agencies had fully implemented OMB's guidance last year, and the remaining 22 partially put plans into action.

As a result, agencies’ plans were substantially short of OMB's overall fiscal 2014 targets: $3 billion in proposed reductions and $2.1 billion in proposed reinvestments, compared to the targets of $7.6 billion in reductions and as much as $7.6 billion in reinvestments, GAO reports.

Reasons for not meeting requirements varied, the report states. “Until agencies complete their ongoing reinvestment plans, they will be challenged to ensure that their considerable savings are being used in the most efficient and effective manner possible.”

The OMB set out its information technology reform plan in 2010 to consolidate data centers and reduce redundant spending.

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