HMRC is planning to reduce its use of large IT outsourcing companies and develop greater in-house computing capabilities.

HMRC's chief information officer, Mark Hall, said the department intends to double its number of software developers to 600 over the next three years.

The move is designed to build up resources ahead of the end of HMRC's current Aspire outsourcing deal with supplier Capgemini. Hall said the contract would not be renewed in its present form Computer Weekly reports.

'My piece is to work toward 2017 to build capability internally around commercial, business analysis, digital capability and adopting agile methodologies. Currently we have around 300 people working as software developers, we are looking to double that over the next three years and build an ecosystem of SMEs around them,' Hall said.

Hall said: 'This isn't about looking to in-source everything, but moving to a more mixed environment. We don't want a big procurement, and we are trying to create a slide path toward internal capability. It will be more of a mixed economy, rather than one big contract.'

The developments will include a commitment to the government's digital strategy, announced in November last year, which sets out a shared vision for 'digital by default' services and a move to paperless working. The HMRC is forming its own Digital Services Unit.

A recently published National Audit Office report shows that HMRC made savings of £74m in the price paid for IT equipment and services (including telephone help lines) in 2011-2012.