A new research report has indicated that IT spending by the country’s public sector in the Philippines is expected to reach $580 million by 2011 as efforts to decentralize IT decision-making start to bear fruit.

However, the study by analyst firm Springboard Research said the country still needs to simplify its procurement process and in the way it implements its IT projects in order to curb corruption and encourage foreign investments.

The report noted a couple of high-profile IT projects in the government, particularly the scandal-tainted National Broadband Network, as examples that can shake the confidence of the public and international donors.

But, Springboard also cited a number of completed projects as good indicators for a positive outlook for government IT spending. Last year, the Philippine government spent about $390 million on IT initiatives.

“Projects like Community eCenters, iSchool, and National Telehealth Center clearly demonstrate the government’s commitment to leverage IT to provide better governance, education, and healthcare to its citizen,” the report stated.

Michael Barnes, vice president at Springboard Research, said in a recent press briefing organized by HP Philippines that while corruption is definitely not unique to the Philippines, it would help the country if the procuring and implementation of IT projects would be done in a trustworthy manner.

“While an increased visibility and transparency is not a silver bullet for all the problems associated with government IT projects, it will improve the ability of the country to move in the right direction,” said Barnes.

HP, for its part, said the company is actively engaging in public infrastructure projects around the world as a way to connect governments to the citizens through various technologies such as the Internet.

The Springboard exec said Dubai is one country that has elevated transparency to a higher level. “Look where is Dubai now – government spending is huge and foreign money is flowing in,” he said.

The Philippines has achieved small victories with decentralized decision-making that has allowed various government agencies to pursue and roll out their own IT projects, Barnes said. The Commission on Information and Communications Technology (CICT), the government’s main ICT body, approves and appropriates most of the time the funds needed for the projects.

The study also noted that education remains the largest individual public sector market segment in the Philippines with more than a third of total spending. Defense, intelligence and safety, and healthcare rounded off the list of the top three segments, all with double-digit market share.

In terms of IT segments, hardware attracted more than half of the total spending by the public sector, while IT services took 27 percent and software grabbed the remaining 21 percent.

Barnes presented the study as part of Springboard's multi-city roadshow aimed at educating the public sector in the use of cloud computing and other technologies for national transformation.