Xansa targets more deals in the public sector

Xansa has set its sights on a number of significant IT outsourcing deals in the public sector, with contracts from large metropolitan councils and central government departments up for grabs over the coming months.

The company recently won an £85m payroll-processing contract with the BBC, beating the incumbent supplier EDS, its larger rival Capita and Indian company Infosys. Xansa expects momentum in the public sector to continue into its second half as it continues to grow its workforce in the UK and India at a rapid rate.

Yet Alistair Cox, its chief executive, has called for more government departments to outsource non-core functions such as payroll processing and IT services in order to cut costs.

"Ministers have to take difficult and bold decisions in the interest of the taxpayer. Government - both central and local - needs to exploit what is out there," Mr Cox said. He said the market for outsourcing government services is massively under-penetrated with only about 20 per cent of the potential business currently contracted.

He said high-profile problems with large government IT projects such as the upgrade of the NHS's IT infrastructure has resulted in reluctance on the part of some government departments to consider outsourcing plans.