As the US economy and political system dusts itself down in the wake of Barack Obama's historic win in the US – bolstered by the speed and organisation of his first week as President Elect – the economy on this side of the Atlantic shows signs of strong outsourcing demand, particularly in government.

British support services group Babcock has reported a 40 percent increase in first-half profit, with gross profits standing at nearly £51 million. It forecasts more growth, in the belief that businesses will turn to outsourcing to cut costs.

CEO Peter Rogers told the Reuters news agency that government bodies in particular will turn to people like his company for strategic support and spend reduction.

The company has fingers in the shipbuilding, defence, rail and nuclear sectors, and is the biggest third-party supplier to the Royal Navy.

But as we've explored in this blog before, is government services outsourcing really a sector that companies should feel confident about, given the high-profile trashing of many suppliers' names by association with troubled Whitehall projects?

There are some worrying signs, looking ahead: Home Secretary Jacqui Smith recently made the unlikely claim that most people are excited about, and supportive of, the ID card scheme, despite the ever-escalating cost to the same people who are allegedly so keen on it.

At the same time, talk of the possibility of supermarkets being among companies in the frame for managing key outsourced elements of the service is alarming – creating the intriguing possibility of a future where people's shopping habits are monitored at the till: obese? No chance of buying that cake, sir! Liver disease? Stand away from that four-pack, ma'am!

I jest, of course... or do I? One tabloid headline today shouted: 'Pay the Obese to Take a Walk'!, referring to some new DoH scheme to encourage the larger parents among us to walk their children to school.... for cash.

Whatever the reality versus the fiction, the ID card scheme remains highly controversial, and it has little to do with security (at least, no one has explained how it will make us more secure). It is almost certainly a bridge to a data-gathering/service matching economy of the future, linking in with citizen relationship management schemes at local level, and who knows what else nationally.

Suppliers may not wish to be associated with such a scheme, given the security risks and political sensitivities. Just ask PA Consulting how its reputation is in the wake of its association with a mismanaged government outsourcing deal.

But there are other, less Big Brother-style signs to be encouraged by: none other than Peter Mandelson has the found the perfect way to restore his reputation: by being the supporter in chief of local Post Offices to provide outsourced services direct to the public. Watch this space for more.

As long as the government returns to seeing the Post Office as being an essential public service rather than a poorly functioning profit-making machine in a deregulated market, it will be a national asset.

Elsewhere, two stories from the Philippines show the strength of the BPO market there: first, there is now a reported skills shortage there, and second, Philippines BPO companies may themselves outsource their staffing and HR needs.