BT was always the biggest supplier of UK of ICT to the government in 2007, but HP’s purchase of EDS could now put the merged company in to the lead.

Research from Kable shows that the state sector spent £2.1bn with BT last year; but the combined ICT spending with HP and EDS was £2.234bn.

HP announced the friendly takeover of EDS on the 13th of May, for $13.9bn (£7bn). EDS will still continue to use its existing name.

The Kable research: The supplier landscape in the UK public sector marketplace 2007, shows that EDS was independently the second largest ICT supplier to the UK state sector, which spent  an estimated £1.48bn with the firm. Fujitso Services followed with £1.2bn, Capgemini with £900m ad HP with £755m. The report ranked all five suppliers in the same order as in 2006.

CSC was one of the only suppliers in the top 20 to change places, moving from 19th place to 10th. Its £400m estimate income from state-sector ICT was boosted by the firm’s adoption of two out of five local service provider contracts from Accenture within the National Health Programme. Accenture got pushed out of the top 20 for this reason

According to the research, the top 20 suppliers account for 70 percent of the £12bn of total spending.

Nick Jotischky, senior analyst at Kable said, “The use of IT in the public sector is in flux. With government transformation at the heart of public-sector policy, technology is increasingly being used as an enabler to drive government policy. While this presents ample opportunity for the supply market, it also suggests that suppliers will need to act more as partners than providers.”

“We see the successful suppliers of 2008 as those that can respond to the public sector’s emerging markets and needs. We also see the government preparing to slim down its own supply chain in an effort to work with fewer suppliers; this will mean the supply community needing to become more open to the idea of working in partnership with fellow suppliers,” Jotischky said.

“Where this fits with the government’s self-declared aim of awarding 30 percent of all contracts to the SME market is not immediately clear,” he added.