Digital transformation in councils is a national necessity. Fund it like one.
Local Government is being asked to deliver one of the most ambitious digital transformations in the public sector, on infrastructure that is in some cases over thirty years old, while keeping live services running for millions of residents. All against a Local Government Reorganisation (LGR) 2028 deadline set in Whitehall. Central Government has underwritten the ambition but not the cost of delivering it, in either money or practical support. While some central resources, such as GDS Local, are being established, their practical impact remains unclear. That mismatch is the real story of council IT. As complex organisations delivering over 800 services to communities across the country, the pressure to transform is piled on, while the support needed to get it done is not.
Many councils are still running revenues and benefits platforms procured in the 1990s, alongside planning and land charges systems of a similar vintage. Bought department by department and layered over decades, these systems contain millions of records entered against different rules by different people. The technical complexity of migrating any of this is routinely underestimated.
What is rarely acknowledged is that not transforming is the more expensive option. The Government’s own 2025 State of Digital Government Review concluded that maintaining legacy systems typically costs three to four times more than running modern alternatives, and that a substantial share of government’s annual technology spend is consumed simply keeping outdated infrastructure alive.
LGR sharpens all of this. Around two hundred county and district councils are due to consolidate into unitary authorities by April 2028, the most significant reorganisation of Local Government in fifty years. Every new authority will inherit multiple sets of finance, planning, revenues and benefits, and land charges systems. Councils will be tempted by the false premise of “consolidate around majority supplier.”
This is a grave error. “Safe and Legal” on day one is the right goal but the reality is that achieving it through consolidation of existing systems means multiple teams, solutions, and datasets simply operating under one label.
Anyone with experience of complex system transformation knows that starting fresh with a modern solution and migrating everyone to it is faster and cheaper. One recent merger programme, consolidating four District Councils onto a single legacy product, has cost well over £1 million and remains unfinished more than six years after vesting day.
All of this is being delivered against a backdrop of chronic underinvestment: budgets squeezed for over a decade, in-house IT teams hollowed out, and digital expertise in short supply across the public sector. The consequences are predictable. Research suggests up to 74% of public-sector transformation programmes fail to deliver their intended objectives. That is not a reflection on councils. It is what happens when ambition outruns the funding and skills required to deliver it.
Despite this, councils are getting on with it. Authorities across England are actively investing in transformation, with the vast majority already using or exploring AI. Councils that start with one service area, land charges or planning, for instance, are increasingly extending digital change across wider regulatory services. Where the work is properly resourced, it delivers. That pattern ought to inform how Central Government designs its support.
What is missing is not goodwill or ambition, both are in plentiful supply, but a funded national programme dedicated to the digital transformation that LGR demands. In practical terms, that means a ring-fenced transformation fund distributed on need rather than competitive bidding; procurement support tied to evaluation and selection of modern systems; national data standards and migration toolkits so councils are not each solving the same technical problems in isolation; and sustained investment in public-sector digital skills.
The end state is worth the effort. Modern, integrated systems mean faster decisions, easier access for residents, lower running costs, and authorities resilient enough to absorb the next round of structural change. But effort alone will not get us there. Local Government is rebuilding the digital foundations on which millions of residents depend. A specific, funded national programme that treats digital infrastructure as the public asset it is must be central to LGR, or the systemic improvement in services it promises will be buried under Safe and Legal priorities. Central Government set the timetable. It should fund the work.
Denis Kaminskiy is the Founder of Arcus Global, a SaaS company, delivering mission-critical core business solutions that empower public sector organisations to transform service delivery, enhance efficiency, and improve data quality.
