Cloud-First Government: Trends and Opportunities for the UK Public Sector

Public sector organisations are under unceasing pressure to do more with less.

But rather than stop all spending, investment remains vital and modernising services means not just introducing new offerings but also considering the technical foundation upon which they are based.

Since 2013, the public sector has taken a cloud-first approach to all things digital. It is estimated that 55% of central government organisations have almost two thirds of their IT estates now in the cloud. This leaves around 40% of estates in on-premises environments.

Like many sectors, some are ahead in their use of the cloud than others, but at a time when budgets are under a magnifying glass, could the cloud benefit the public sector in other ways that might not have been considered yet and drive real-world impact?

Key trends

In the decade plus since cloud-first strategies became a public sector policy, we have seen this evolve into cloud-native.

This natural progression of the cloud’s adoption doesn’t just mark an acceptance of it but also demonstrates a growth in cloud confidence. Public sector organisations have recognised its power to provide greater agility, scalability, and access to a full suite of services, transforming how they operate.

For those who are part of the cohort with on-premises infrastructure remaining, the cloud is increasingly becoming a foundation for back-up infrastructure. Security and compliance remain a top priority for organisations of all sizes and sectors and given the importance of services provided by council teams, they can’t afford to risk there being any downtime, nor the chance that they lose sensitive citizen data. Afterall, security must now be considered a central driver in all aspects of an IT programme and upholding governance is vital.

Underpinning all investment, however, is a need for value for money. Of late, we have seen many organisations enter cost optimisation programmes to squeeze their cloud investment of all the efficiency possible. With budget constraints a constant reality, the public sector is moving beyond solely looking for basic cost savings to embracing a FinOps culture whereby it actively monitors and optimises their spend in the cloud in real time. This has the added benefit of ensuring that taxpayers’ money is used as efficiently as possible.

Areas of opportunity

Moving beyond this, as this comfort and confidence continues to grow in the cloud, where the service or workload fits best there are five key areas where we see further opportunity for it to continue to transform public services:

Citizen-centric digital services: Tapping into the cloud’s scalability and agility, local authorities can look to broaden their development and hosting of modern, user-friendly services. For example, creating seamless online portals for council services, tax management, or health appointments that can cope with spikes in demand without crashing.

Data-driven policy & decision-making: The centralisation of data can enable local authorities and public sector departments to analyse vast amounts of data from various sources and gain a single, unified view. By developing cloud-based data lakes and analytics, teams can inform and enhance policies related to public health, urban planning, or general resource allocation, leading to more effective and evidence-based decisions.

Modernising legacy IT & infrastructure: While some on-premises infrastructure may be required, local authorities could boost their use of the cloud to migrate from outdated and expensive systems. Modernisation strategies can be launched in a phased migration approach, considering one critical application at a time so as to reduce any risk and allow for a smooth internal transition.

Enhanced resilience and disaster recovery: As we are seeing with several of our customers, the public sector can use the cloud’s distributed infrastructure to build highly resilient systems. For example, they can ensure that critical services remain available during downtime caused by power cuts or cyber attacks, with automatic failover to other regions. This is something that would be cost-prohibitive with any other IT set up.

AI & automation for public good: With the rise in use of AI, the cloud can provide a foundation to automate administrative tasks and improve overall service delivery. By deploying AI-powered chatbots or agentic AI to handle common citizen enquiries 24/7, staff can be freed up to focus on more complex and high value cases.

The public sector’s cloud journey is one of transformation. By embracing key trends like disaster recovery and FinOps, and taking opportunities in citizen services and data analytics, organisations are moving from being reactive to proactive.

The cloud is the foundation for a more resilient, efficient, and ultimately, a more impactful public sector—ready to meet the challenges of today and the opportunities of tomorrow.

If you would like to discuss this in more detail, we will be attending Holyrood Connect’s AI & Cloud Innovation Summit Scotland in Edinburgh on Thursday 11 September 2025.

More details here: https://events.holyrood.com/event/ai-cloud-innovation-summit/