The government has claimed taxpayers will save £500m this year thanks to the digital by default initiative and the reduction in waste and efficiency in public-sector IT spending.
It has also announced plans to digitise more public services as part of a drive to become "the most digital government" in the G8 by next year.
The move will see 25 "exemplar" public services move fully online by 2015, with services such as student loans, the electoral register and tax self-assessment all becoming fully digital programmes.
In addition to reducing costs, with online services up to 50 times cheaper to run than face-to-face services, the government claims the "digital transformation" will also improve services.
"I'm pleased to announce today that we expect to save at least £500m from IT spend this year, on top of the £500m we saved from government's IT spend last year and £250m the year before," said Francis Maude, Minister for the Cabinet Office.
Maude singled out the Driver and Vehicle Licensing Agency (DVLA) as a good example of a public-sector organisation that is embracing the reforms in order to provide a more cost efficient and effective service.
"To win the global race and save hard-working taxpayers more money, we need world-class public services available online 24/7 from anywhere. That's why its great news that DVLA is about to launch online driving records which can be used by anyone with a driving licence as well as by the insurance industry," he said.
"Back in 2010 our digital offering was limited at best and government IT was a by-word for disaster," Maude continued. "There are still challenges but with the help of the Government Digital Service I am determined that the UK will be the G8's most digital government by next year."
Oliver Morley, chief executive and digital leader at the DVLA, added that digital tools even help to provide services that aren't online.
"Our aim is to maximise the use of digital to deliver high quality, customer-focused services that work for everyone," he said.
"Although some services cannot be delivered digitally, such as assessing a customer's fitness to drive, we can improve the processes supporting the delivery of these services through making greater use of digital tools."
The government might be congratulating itself over progress with the Cabinet Office's digital by default programme, but things have gone much less smoothly elsewhere.
IT strategy at the Department for Work and Pensions (DWP) has been described by some as a disaster, with the government having written off at least £140m on its Universal Credit welfare project. An anonymous department source revealed the full extent of the disaster to Computing, saying that staff are more worried about headlines in the newspapers than the ultimate success of the project.