Context

For decades, information technology (IT) implementation has been an integral component of delivering practically all public services. Databases, software applications, websites and online forms are the technology systems by which citizens interact with their governments, and the mechanisms by which public servants do their work.

The technology systems used in government have a long-standing reputation for being outdated and cumbersome to use. The result is that routine public service activities, such as processing a benefit application, business registration, visa application or permanent residency application, are unnecessarily time-consuming and error-prone. Mediocre technology systems translate into inefficient public service delivery.

Poor-quality government software, used every day by public servants, also has a long-term effect on decision-makers’ expectations of what is possible (Boots, 2020). Senior public servants, even those in IT roles, are often unaware of how the technology world outside of government has evolved. This is particularly true in the nearly two decades since the iPhone launched, precipitating a rapid evolution in consumer technology and raising consumer expectations for design and usability (Patel, 2026).

The lack of technology awareness among public service decision-makers is reinforced by the insular nature of most public service organizations. Unlike finance, human resources and legal expertise, technological expertise has never been considered a core skill of senior public servants. It shows (Ling, 2025).

A history of costly and ineffective government IT megaprojects

As governments have begun to recognize the risks of outdated IT systems, they have turned to large-scale modernization projects intended to replace entire collections of existing systems at once. A few examples include the federal government’s Phoenix pay system project, which had cost $4.34 billion by 2025 (Côté-Sroka, 2026); the Canada Border Services Agency Assessment and Revenue Management project, which had cost $678 million by 2025 (Canada Border Services Agency, 2025); Employment and Social Development Canada’s Benefits Delivery Modernization, with an estimated budget of $4.8 billion (House of Commons, 2026); and the Quebec automobile insurance board’s SAAQcliq project, which has cost $1.1 billion to date (Radio-Canada, 2026).

These are multi-year projects that have cost taxpayers hundreds of millions or billions of dollars apiece. In many cases, these megaprojects have had little to no perceptible improvement over the systems they have replaced; in others, they have led to thousands of errors that have dramatically affected people’s lives and well-being (Steele, 2016).

The years-long development time of these projects also means that by the time they launch and the public interacts with the new system, they are already outdated. Technology decisions, such as which database products and programming languages to use, are written into departmental IT standards and into procurement requests for proposals, locking in these decisions long past their “best before” date. Established government IT vendors are happy to comply, using technologies and tools that more nimble technology companies would be embarrassed to still be using. The cumulative effect is that brand-new government IT projects frequently launch with underlying technology components that the private sector abandoned a decade earlier.

Meanwhile, governments routinely spend hundreds of millions of dollars and years of work on projects that never publicly launch and are often never publicly acknowledged at all (Ottawa Civic Tech, n.d.). These “silent failures” have a similar cost to the failures that make the news. This is particularly true since IT megaprojects tend to swallow up and extinguish other smaller-scale technology improvement efforts across an entire public service organization. When the megaproject fails, it leaves in its wake a decade of lost opportunity for tangible process and technology improvements.

The impact of failed IT projects on public service behaviour

For senior public servants and political leaders, the recurring failure pattern of large IT projects has the downstream effect of creating a continually heightened sense of risk aversion. The failures also create dependencies on established management consulting firms and large IT vendors, who lend perceived credibility to projects and act as an accountability shield when things go sideways.

In a self-reinforcing manner, these downstream effects all make future project failures more likely. Former auditor general Michael Ferguson also noted, in his analysis of the Phoenix pay system failure, that the project had blurry lines of accountability, either “by design or by accident” (House of Commons, 2018).

There is a better way, and it depends on dramatically rethinking how government organizations manage and procure IT projects. The recent rise in large language models and generative AI tools, particularly for use in software development, has jolted senior public service leaders and politicians into realizing that technology systems can be developed in hours or days rather than years (Microsoft, n.d.).

Other governments around the world (and some Canadian provinces and territories) have adopted modern practices, building user-friendly online services and technology systems rapidly for a fraction of the cost (Clasadonte et al., 2020; Ontario Digital Service, 2018; Rooney, 2016; Shipman, 2018). Many government IT leaders think that government IT software is extraordinarily complex; it isn’t. The costs are mostly associated with compliance overhead (e.g., legal and regulatory requirements). If those non-delivery requirements were reduced, projects could be completed more quickly.

Delivering technology projects in a smaller cost and time range is doable. The added benefit is that technology systems — and the services to the public that depend on them — can be delivered quickly enough to be relevant for the policy issues and priorities of the day (Boots, 2023a, 2023b). A project development period of five to 10 years does not help governments respond to the urgent needs of a pandemic, a large-scale disaster, an economic crisis, or geopolitical and military situations. Small, inexpensive and iterative technology implementation is useful technology implementation. The alternative is our current norm: outdated and mediocre, if a system even launches at all.

Considerations

The barriers to effective government technology reform are organizational

Government technology reform efforts in Canada have largely been done in piecemeal fashion, which makes them ineffective. Using a modern technology framework does not automatically produce dramatic time and cost savings, especially when it is hampered by rigid project plans and compliance reporting, waves of review committees and gated approvals.

The barriers to achieving these outcomes are organizational, rather than technical. They consist of outdated ways of managing projects, outdated procurement practices and vendor dependencies, outdated review and approval processes, and outdated organizational structures that isolate technology capabilities from the program areas responsible for delivering services.

Resolving these barriers and opening the door to small, inexpensive and iterative technology implementation depends on removing existing government processes and practices. These processes and practices benefit established teams, organizational units and committees, as well as an ecosystem of vendors and consultants that have a vested interest in maintaining the status quo. Asking an IT policy unit to eliminate, for example, many or all the policies the same unit originally introduced is a losing battle.

These existing processes and practices may have originated in the aftermath of a previous failure, making their removal particularly fraught even though they actually produce a higher likelihood of repeated failure (Boots & Clarke, 2024). In their absence, other more effective and less burdensome accountability mechanisms are required.

There is a need to develop in-house technology capacity

Moreover, removing barriers needs to be accompanied by rapidly developing in-house technology and design capacity (Canadian Digital Service, 2019; Craig, 2022b). Governments that have successfully prioritized modern technology practices have done so by bringing in talented people from outside government, at a scale sufficient to make these practices stick. Done at too small a scale, established public service IT teams will just “wait out” the pressure to adopt more modern technology practices. In-house technology talent has been described as a “silver bullet” for successful government IT outcomes (Lerner, 2021).

Assembling in-house talent includes recruiting software developers, designers, design researchers and product managers into multidisciplinary teams. These teams are organized around technology products and services, within mixed-classification teams and reporting structures. This is in contrast to the current model, in which government HR structures generally separate people into classification silos.

All these changes require technology-minded and talented senior public leaders at the highest level of an organization (at the deputy head level or equivalent). In jurisdictions where these approaches have been successful, these leaders are technology and design practitioners that have successfully shipped software products. This was the case in Ontario from 2017 to 2024, where the Ontario Digital Service — led by an experienced technology practitioner in a deputy minister role — set the bar for digital service delivery in Canada (Government of Ontario, 2017). The selection process for senior public servants, at least in the Canadian federal government, is not designed to achieve this.

Adopting all these changes at once may seem like an unlikely possibility. The approach to follow here is not incremental policy changes; it is wholesale changes to policies and practices, adopted incrementally one program team, department or organization at a time.

What this requires is support from senior public servants and political leaders to do things differently, and to fend off the “immune response” from existing parts of the public service that are threatened by these changes (Beattie & Buisman, 2025). Successful government technology and design teams are a threat to existing government IT organizations, unsupportive policy teams and (in some cases) senior public service leaders. The success of technology and design teams demonstrates in tangible ways the limited capabilities, achievements or negative outcomes of the latter groups. They will push back, with established organizational support on their side. Persistent senior public service and political leadership support is the only way to overcome this.

Recommended Action

This memo recommends foundational changes to IT project management practices and procurement policies, organized in three categories. Ultimately, the goal is to create enabling conditions that empower government technology teams to deliver small, inexpensive and iterative technology systems that actually work. These systems should be user-friendly, fast, reliable and accessible. They should also be continuously improved based on user feedback.

Many of the recommendations below are specific to the Canadian federal government. However, the overall principles can be applied to any Canadian government jurisdiction.

1. Eliminate megaproject incentives

Budget and funding approval processes (annual budget proposals, Treasury Board submissions, memoranda to cabinet and related internal departmental mechanisms) incentivize creating singular projects that are large and complex. A $200-million IT project can involve the same level of administrative overhead as a smaller $300,000 project, motivating departments to combine many system improvements into one proposal. This typically involves extensive upfront planning and documentation, which prevent implementation teams downstream from responding to user feedback and new insights.

Megaproject concepts frequently become megaproject procurements, where a single modernization effort is expected to improve a wide range of services or replace many obsolete systems at once.

Eliminating these incentives can be done by:

• Implementing spending caps, where departments are barred by Treasury Board policies or Department of Finance rules from proposing or implementing new IT projects larger than $2 million per year, forcing departments to break megaprojects back down into smaller discrete components that are individually credible, deliverable and useful.
• Redesigning senior public service executive selection processes to prioritize demonstrated public impact (such as successfully shipping services or launching publicly accessible technology systems), rather than prior experience working on IT megaprojects.
• Creating a permanent fund that departments can subscribe to for small-scale technology system improvements.

The approximately $1 billion Government Transformation Fund announced in the November 2026 budget (Department of Finance Canada, 2026), if implemented well, could provide the needed funding for small-scale technology improvements across government. The U.S. General Services Administration’s 10x program, which provides incremental funding to in-house technology ventures at different levels of scale, is a useful blueprint to follow (General Services Administration, n.d.). If Canada’s new Government Transformation Fund is used for yet more megaprojects, it will be a costly missed opportunity.

2. Reduce incumbent vendor dependencies

A small set of established vendors (large IT solution providers and management consultancies) benefit disproportionately from Canadian public-sector IT projects.

These vendors’ differentiating skill is successfully navigating government procurement processes, which usually come in the form of requests for proposals or standing offer agreements. Their track record includes many project failures (CBS Philadelphia, 2017; Centre for Public Impact, 2017; Lecher, 2020; Shueh, 2017).

Despite this, established vendors continue to successfully bid for government IT projects, particularly when these procurements are for ill-advised megaprojects that smaller and more capable vendors are not interested in or equipped to deliver (Clarke & Boots, 2022). Mid-to-senior-level public service executives with IT or service delivery experience often join these vendors as sales and government relations executives upon leaving government, a pipeline that disincentivizes public service leaders from criticizing vendors’ work (Regulatory Capture Lab, n.d.).

These incumbent vendors benefit significantly from vendor lock-in, a phenomenon where organizations are unable to move away from an existing technology vendor even if the vendor’s performance degrades or costs increase. This can be due to limited abilities to export data from the vendor’s existing technology system into a competitor’s, limited technical capacity within the public-sector organization, or other licensing, legal or organizational barriers (Boots, 2021).

Many of the vendors most widely used by Canadian public-sector organizations are Canadian divisions of large American technology firms. As Canada-U.S. relations have become more tense, this has become a source of concern due to U.S. legal jurisdiction over data that is handled by companies with a U.S.-based business presence (Canadian Shield Institute, n.d.). Simply hosting data within Canadian borders does not protect it from U.S. law enforcement actions or sanctions if it is stored in data centres or technology systems managed by these companies (Sobowale, 2026).

Reducing incumbent vendor dependencies can be done in several ways:

• Reducing the barrier to entry for small firms to participate in government technology procurements by simplifying procurement processes, eliminating assessment requirements for organizations (such as Public Services and Procurement Canada’s (2024) Designated Organizational Screening) and issuing substantially smaller contracts.
• Wholeheartedly championing open-source software as a government preference. Open-source software reduces costs, improves software quality (Shipman, 2017) and is more secure compared to proprietary software (Hunter, 2024).
• Requiring that intellectual property for custom-developed software be owned by the government rather than the vendor and published in open-source repositories available on publicly visible platforms like GitHub or Codeberg. The Treasury Board Secretariat’s (2022) current Policy on Title to Intellectual Property Arising Under Crown Procurement Contracts should be fully rescinded.
• No longer using procurement mechanisms such as requests for proposals and standing offer agreements to select technology products and platforms. Instead, these should be assessed and selected by in-house government technology teams with up-to-date expertise. To enable this, sole-source limits (the maximum amount the government can spend without seeking competing bids) for technology products and services should be increased up to the largest amount allowed by international trade agreements.
• Collaborating with like-minded governments on Digital Public Infrastructure projects, such as France’s LaSuite, where governments collaboratively produce high-quality, open-source technology systems that can be used and adapted freely by any government organization (Direction interministérielle du numérique, n.d.).

3. Build in-house technology capacity

Public servants are constantly working behind the scenes with databases, case management systems and online application portals. Delivering small, inexpensive and iterative technology systems rapidly depends on having high-quality technology expertise within the organization. The federal government appears to have acknowledged that need with their November 2026 budget announcement that they would “spend $17.6 million over five years, starting in 2026-27, and $4.2 million in 2031-32, to establish a Fellowship Program through Build Canada Exchange to recruit technical experts, professionals, and academics to support priority projects” (Department of Finance Canada, 2026, p. 297).

In large departments, this expertise should be embedded directly within the program teams responsible for delivering services, rather than having stand-alone IT units. Organizations should include software development, design and design research expertise within these teams, hired as public servants rather than consultants or contractors (Craig, 2022a).

Deputy heads of organizations associated with these teams should have technology and design delivery experience – not just sales or IT account management experience. These deputy heads should use their positions to shield the teams from interference by existing parts of the organization that might be threatened by their ways of working.

Building in-house technology capacity depends on a combination of:

• Adjusting staff compensation for senior technology roles to be market competitive. Senior technology salaries in the private sector are often two to three times larger than those of government IT workers.
• Enabling senior-level, non-management employees to reach the highest job classification levels. These types of roles are widely available in the private sector but are not permitted within the federal IT classification under the Office of the Chief Human Resources Officer’s Information Technology Job Evaluation Standard (Treasury Board of Canada Secretariat, 2025).
• Encouraging mixed-classification team and reporting structures within organizations, to support multidisciplinary teams.

Conclusion

A forward-thinking government department could create and enable one of these teams today with sufficient senior leadership support. More realistically, these conditions could be implemented alongside the creation of a new stand-alone organization, such as the newly created Digital Transformation Canada. But Digital Transformation Canada will only be successful with an organizational culture that is decidedly different than that of the established large federal IT organizations it is expected to consolidate (Clarke, 2026).

The recommendations above directly challenge many established federal policies and practices stemming from the Treasury Board Secretariat (TBS) and departments. Updates to TBS policies over the past several years, even those following the political scrutiny around the ArriveCan app, have not been able to overcome the deep gap in federal organizations’ technology capacity. Canadian public service IT leaders’ lukewarm support for (or opposition to) open-source software practices is, largely, an indicator of their lack of awareness of the modern technology industry.

The Policy on Title to Intellectual Property Arising Under Crown Procurement Contracts specifies that vendors (rather than the government) should own intellectual property developed in procurement contracts (Treasury Board Secretariat, 2022), a vendor-friendly economic development attempt that largely leads to federal departments paying for similar software multiple times over. A sufficiently motivated deputy head could push back, reasonably successfully, on all these barriers. A differently minded TBS could act rapidly to create a more enabling environment for modern technology work.

It’s worth reiterating that doing this is possible. Other governments have delivered digital services using modern tools and practices for more than a decade (Craig, 2022b). None of these ideas are new, but it takes a level of capability and courage that most Canadian public service organizations have not frequently demonstrated to implement them.

Being able to deliver technology systems that actually work — that are easy for the public and public servants alike to use, that are reliable, that are fast, and that are iterated on and improved quickly enough to stay relevant — is how governments deliver all of the public services they deliver well. Technology and design are core public service and public service leadership competencies. They practically always have been.

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This memo was commissioned as part of Capacity for Change: Designing a Public Service Built to Deliver, an IRPP research project that aims to provide solutions to barriers to state capacity through research-backed recommendations from leading experts. The publication was developed under the direction of IRPP President and CEO Jennifer Ditchburn and Professor Jennifer Robson, Director of Carleton University’s School of Political Management. It was copy-edited by Maya Lach-Aidelbaum, proofread by Zofia Laubitz, editorial co-ordination was by Étienne Tremblay and production was by Chantal Létourneau.

Sean Boots is a technology professional and researcher who focuses on public-sector capacity and empowering public servants.

Beginning in 2016, Sean was part of the founding team at the Canadian Digital Service (CDS), a new digital service delivery initiative within the federal government. He played a core role in building the culture of CDS, equipping colleagues with modern equipment and software, and launching and scaling services including GC Notify and the COVID Alert app.

In 2022, he was a Public Servant-in-Residence at Carleton University, researching government IT contracting practices with Professor Amanda Clarke. Sean studied Public and International Affairs at the University of Ottawa and previously worked as a software developer and product designer. He lives in Whitehorse, Yukon, and writes about government technology efforts at sboots.ca.

This project was made possible in part thanks to support from the Max Bell Foundation and the Metcalf Foundation. The IRPP is an independent think tank, and retains control over the scope, methodology, conclusions and recommendations of our work.

A French translation of this text is available under the title Pour en finir avec la malédiction des mégaprojets informatiques : livrer des systèmes technologiques gouvernementaux qui fonctionnent.

To cite this document:

Boots, S. (2026). Ending the IT megaproject curse: Delivering government technology systems that actually work. Institute for Research on Public Policy. https://doi.org/10.26070/qrsd-d322