Robust Federal IT Security Spending Expected

The independent government market research firm traced the rate of spending growth over the past few years, noting that cyber spending grew slowly prior to the September 11, 2001 terrorist attacks, which then caused a rapid growth in cyber security spending over the next three years.

"The effects of 9/11 have changed the way federal agencies approach cyber security," said Marcus Fedeli, INPUT's manager of federal opportunity products, in a statement. "Continued fear over potential terrorist attacks has caused an almost desperate need for improvement of current standards and levels of security. New requirements will cause civilian IT security spending to grow steadily this year."

INPUT pointed out that the Office of Management and Budget (OMB) promulgated cyber security standards in the Federal Security Management Act (FISMA) of 2002. FISMA encouraged federal agencies to beef-up their IT operations.

But federal agencies still don't operate in generally secure environments, getting a nearly-failing D+ on their recent FISMA Report Card, INPUT observed, citing "insecure VPN connections, faulty firewall protection and the need for customized solutions. These vulnerabilities open IT systems to potential fraud, sabotage, and destruction."

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About 17 percent of civilian agencies' Fiscal Year 2005 spending for development, modernization, and enhancement (DME) is earmarked for IT spending--representing about $1.6 billion, according to INPUT. Homeland Security, Energy, Transportation, and Health and Human Services are the leading IT security spenders.