As the government looks to reduce the public deficit £6bn worth of cuts have been introduced with government departments warned that they will have to produce savings of between 25 to 40%.
One of the areas where there had been a decent spot of business for the channel was in helping local government and public sector bodies meet the various security compliance requirements.
Although councils will still have to remain compliant they are under pressure to find savings and are unlikely to look on further security investment with any relish.
Speaking to MicroScope, Alex Teh, commercial director for security distributor Vigil Software, said that it had a significant portion of its business flowing from the public sector and it was now looking to re-engineer its operations.
He said that the spending on compliance regulations was being maintained "councils and schools have to comply with the regulations because if they don't they Information Commissioner will come down very hard on them".
But Teh added that a lot of projects were now being put into a "let's wait and see" situation as public sector customers waited for the autumn review and more clarity on exactly where the cuts will fall.
As a result Vigil is looking to grow more business in the commercial area which is picking up in confidence, to counter balance the loss of income from the public sector projects.