2003 was a year for the IT industry to lick its wounds from the troubles of the previous 12 months and start to cast warily optimistic eyes towards the future.

Suppliers have been consolidating to get in shape for the much-awaited recovery, while users have been putting their house in order (or in India) to lay the foundations for more strategic projects to come.

At Computing, we've been celebrating our 30th anniversary year, but it's been a time for looking ahead not wallowing in nostalgia.

We looks back on the highs and lows of an important year for UK IT.

The year's highest-profile project kicks off, as NHS director general of IT Richard Granger invites suppliers to bid for the £2.3bn National Programme contracts. Straight away the sceptics are on his back saying it will never work. Network Rail starts an IT overhaul to help modernise the railways - will it stick to the timetable? Tesco puts radio frequency ID (RFID) chips onto Gillette razors in Europe's first in-store trial of the smart barcode technology. Unilever announces a three-year plan to move its infrastructure to Linux. And the much-delayed Child Support Agency systems finally go live, sort of.

Indian outsourcing rises rapidly to the top of the IT agenda - analyst Ovum Holway predicts 25,000 UK software and services jobs will move to the subcontinent by 2006. The NHS National Programme starts to take shape, but critics say its ambitious timetable is unachievable - not for the last time, Granger sticks to his guns. Another sign of things to come as the debate on national identity cards hots up - at this stage still euphemistically called 'entitlement cards' by the government. And WiFi is the hot new technology, with hotspots switching on around the country and British Airways taking wireless to the skies - Computing joins the first internet-enabled flight to New York, and files the first live story from 30,000 feet.

We reveal that the bill for government IT cock-ups since 1997 has topped £1.5bn. The outsourcing boom continues - Axa signs a $1bn deal with IBM for pay-as-you-go systems. 3 finally launches the UK's first 3G mobile phone service, to a less than resounding reception. Red faces at Amazon as it accidentally offers a £200 PDA for £8 and is forced to cancel thousands of orders.

It's a busy month - who said the industry was in a slowdown? BAA hands its desktop systems to Computacenter, HP wins mega-deals at Bank of Ireland, Procter & Gamble and Ericsson, the Department for Environment, Food and Rural Affairs invites bids for a £1.4bn contract and the Ministry of Defence (MoD) starts the biggest government IT contract yet, the £5bn Defence Information Infrastructure. But its not all bad news for IT departments - Barclays drops plans for a massive deal with IBM because its in-house team did such a good job. Users start to turn up the heat on software suppliers as research shows there were more than 2,500 security flaws uncovered during 2002 - that's seven every day. The government's first open-source based project goes live at the Department of Work and Pensions. Network Rail pledges £2bn for new leaf-proof IT. And Microsoft launches Windows Server 2003.

The government's tax credits hit the front pages as problems with EDS-supplied IT systems cause massive delays in processing payments. Grid technology starts to enter the mainstream as Rolls Royce and Shell discuss projects. DaimlerChrysler and BMW talk about their plans for utility computing. HP celebrates the first anniversary of its Compaq acquisition with better-than-expected results. Biometrics will be used on passports by 2005 - another step to national ID cards? Of course not...

The enterprise software market becomes exciting (a phrase we thought we'd never write). PeopleSoft announces a $1.8bn merger with rival JD Edwards, clearly putting Oracle chief executive Larry Ellison's nose out of joint, because four days later he says he wants to buy PeopleSoft, beginning months of unresolved mud-slinging. Computing readers say HP is the top UK supplier in our exclusive ImageTrak survey. Barclays can't resist outsourcing after all, handing its desktop systems to EDS, while Marconi's IT goes to CSC. Wal-Mart, the world's biggest retailer, tells suppliers to adopt RFID. SCO Group claims it owns part of Linux, instantly making itself the world's least popular IT supplier, and sues IBM for copying Unix code into the open-source operating system.

Spam is on the menu as politicians and policymakers meet to discuss the growing annoyance and how to stop it. Surprise, surprise, there's more outsourcing going on, as HBOS and Abbey sign deals with Computacenter. We reveal that National Rail Enquiries could be outsourced to India, trade union uproar soon follows, the trains still run late anyway. Government discussions on ID cards are leaked - will they, won't they go ahead? More Whitehall IT problems - the Inland Revenue says it will seek compensation from EDS over the tax credits fiasco, and GCHQ reveals a £400m IT overspend.

We reveal that the Inland Revenue skipped key parts of the official Gateway project review process for the tax credits system - when will they learn? The NHS announces the shortlists for the National Programme - confounding the critics who said suppliers would baulk at the demanding expectations. Lego opts for pay-as-you-go (or build-it-yourself?) computing. Microsoft is in trouble with the EU competition authorities again - and isn't especially popular elsewhere as hackers exploit more flaws in Windows to launch the fastest-spreading virus in history.

The government is planning a single Whitehall-wide IT strategy for the first time. Business calls for talks with authorities over the growing burden of legislation and corporate regulations. The first NHS contract - for electronic bookings - is awarded to SchlumbergerSema (it would never happen, said the critics. Ah, sorry, it just did). PeopleSoft completes the acquisition of JD Edwards - but Larry Ellison says he is undaunted and still wants to complete his hostile takeover. The government announces its anti-spam laws, probably emailing everybody to let them know.

Half of all UK households are now on the internet. SCO, the Billy No-Mates of the IT industry, now wants Linux users to pay for a licence. The government's outsourcing bill is set to reach £16bn in the next two years. Microsoft is a busy bee - admitting that security fears have affected its sales, launching Office 2003, and unveiling Longhorn, the next version of Windows - but don't get too excited, it's not due until 2006. The MoD announces plans for the Skynet communications network, while Arnold 'Terminator' Schwarzenegger becomes Governor of California - surely a coincidence?

Bill Gates tells Computing that sorting out Windows security problems will take time. Signs of recovery as PC sales soar 17 per cent. The internet celebrates its 30th birthday. BAE Systems goes for grids. Novell buys Linux vendor SuSe. Will they won't they? They do - the government announces plans for ID cards by 2008. Tesco commits to RFID in its supply chain by 2007. And IT probably plays a part in England winning the Rugby World Cup - maybe Jonny Wilkinson has a PC at home.

The BBC is to outsource its technology arm, and tells us about plans for broadband TV-on-demand. India is back on the agenda with more calls to halt the spread of jobs overseas - which the government rightly dismisses. The NHS National Programme meets its objective of selecting key suppliers by Christmas (sorry, sceptics). The great ID card debate picks up momentum as we reveal concerns over whether biometric technology is good enough for government use. And poor old EDS loses its flagship Inland Revenue outsourcing deal to CGE&Y.

This year Computing celebrated its 30th anniversary. It was a time to reflect on the progress of the IT industry over the last three decades, but our main aim was to highlight the good things in UK IT, just when too many doomsayers were grabbing the headlines. It's been a great success.

British Airways told us how IT is at the heart of its fightback from the worst slump in airline history. The London Stock Exchange explained how technology is the cornerstone of its plans for international expansion. And NHS director general of IT Richard Granger gave us a series of exclusive interviews outlining how IT is central to health service modernisation plans. These and other stories during the year showed that UK IT is alive and well and generating more good news than ever.

In October, our annual Computing Awards for Excellence ceremony was hailed as the best ever - 1,000 VIPs gathered to celebrate our 30th birthday and recognise the achievements of the industry. Royal Bank of Scotland, nhs.uk, Cambridgeshire County Council, Bacs and the police Viper project walked away with the prestigious Project of the Year awards, while readers voted Bill Gates and Microsoft as the biggest influences in IT in the last three decades.

Our 31st birthday may not be as high-profile, but expect the good news about UK IT to continue in Computing.