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Unless they are planning to stay with IE6 until the end of the universe, aren't they just postponing the eventual expenditure. At some point they will have to make the migration. Meanwhile, any costs from using a 9 year old browser (malware, productivity reduction etc) are pilling up.
What does make sense is to delay the migration until IE9 is out. If they where going to migrate anyway, why not wait for IE9 since it's just a few onths away?
The British government spent an enormous amount of money just to upgrade to Windows 2000. (Or maybe XP)
IE9 is not compatible with XP, only Vista SP2 and higher....
They can't drop IE6 right away, far too many of their apps are completely locked in to it and a migration would be hugely expensive right now.
What they should be doing however, is making long term plans. While it might be expensive to replace existing applications, ensuring that future applications (and upgrades to existing ones) offer compatibility with all browsers is considerably cheaper.
They should be making plans to replace IE6 once all their other applications are cross browser compatibility, and at this point they should really be dumping IE entirely. No other browser vendor has ever pursued a strategy of locking users in, or caused such a large amount of lasting harm (as can be seen in this case).
The government should take a cautious long term approach, with the ultimate goal being to ensure that lock-in like this doesn't happen again.
Unfortunately, government IT projects are usually corrupt and incompetent, so i don't hold much hope that 10 years from now people will be saying the same thing about being locked to IE8...