Tag Archives: investing in digital

Digital transformation in government: moving towards 100% digital

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Mike Bracken, former Executive Director Digital for the UK Government, on a stage with the word 'Onwards' in the background.

Mike Bracken, former Executive Director Digital for the UK Government, speaking about  ‘The digital transformation of the UK Government ”  Image by gdsteam via Creative Commons

By Steven McGinty

On the 1st March, Companies House, the agency responsible for the UK’s register of companies, announced their intention to become a 100% digital organisation by the end of 2018/19. Over 80% of companies already submit their documents digitally, but the agency is keen to move this figure as close to 100% as possible, highlighting the cost savings and improved levels of service.

However, Companies House is not alone in its digital ambitions. ‘Digital by default’, the idea that digital services should be the most convenient option for people, has been a key policy aim of the UK government.

Digital Transformation programme

In January 2013, the government introduced its first significant venture into digital transformation. The programme, which involved the Government Digital Service (GDS) – the agency responsible for digital transformation – and eight government departments, set out to transform 25 major services in 400 days, with the aim of developing services that were simpler, clearer and faster to use.

By the end of the programme, in March 2015, twenty exemplar projects had been completed, including services as varied as enabling people to register to vote, making a claim for the Carer’s Allowance, and booking a prison visit.

“Death of the self-assessment tax return”

In the March 2015 Budget, the Chancellor, George Osborne, announced a major IT project, which he described as “a revolutionary simplification of tax collection”. At the time, 12 million people were completing self-assessment tax forms every year. But by early 2016 the government expected that five million small businesses and the first ten million individuals would have personalised digital tax accounts, bringing together all their tax details. By 2020, it’s expected that over 50 million individuals and small business will benefit from personalised digital tax accounts.

Although the project has generally been praised, Jamie Morrison, private client partner at HW Fisher & Company, has warned that – apart from the most straightforward cases – automation won’t improve the self-assessment experience. Similarly, Mark Abbs, a tax partner at London-based chartered accountant Blick Rothenberg LLP, has suggested that the five-year time frame might be too ‘ambitious’.

Investment in digital transformation

As part of the 2015 November Spending Review, George Osborne provided £1.8 billion over four years to support digital transformation initiatives.  This included supporting the move towards digital tax accounts, mentioned above, and the introduction of a simple payment mechanism for all central government services.

In addition to this funding, UK Trade and Investment (UKTI) – which works with businesses to ensure their success in international markets – received £24 million to simplify their online services and ensure they can interact effectively with other government services.

More surprisingly, the GDS was given a budget of £450 million over four years – an increase on its previous £58 million a year. This news was particularly positive for those connected with the GDS, as there was concern that their budget (and influence) would be greatly reduced.

Challenges of digital transformation

The biggest challenge to the goal of ‘100% digital’ is that not everyone is able to access digital services (and to a lesser degree those who have access but need support). In 2015, the Office of National Statistics (ONS) found that 14% of households in Great Britain had no internet access, with 31% reporting that this was due to a lack of skills. Other factors for lack of access included the cost of technology (14%) and the cost of accessing the internet (12%).

Elizabeth Rust, in a 2014 Guardian article, highlighted that often those who are digitally excluded need to access government services the most. She offered the example of a jobseeker who lost his Jobseeker’s Allowance because he struggled to access the internet to apply for jobs, particularly as limited access was available at his local library.

This highlights the challenge of achieving ‘100% digital’, and is why although HM Revenue and Customs (HMRC) are now moving towards digital tax accounts, there will still be an option to complete self-assessment returns in the traditional way.

In the 2016 March Budget, George Osborne also provided £71 million of extra funding to support the digital tax roll-out. These additional resources will be used to extend the opening hours of customer service offices that deal with online enquiries and tax credits.  These improved services should be in place by 2017, enabling greater levels of support for users of digital tax records.

Conclusion

Digital transformation provides a major opportunity for improving government services and reducing costs. It’s not a case however of simply replicating existing customer journeys within an online environment. It requires organisations to put people at the heart of their delivery approach. And in turn, this requires significant internal challenge and change.

The ambition for digital transformation will only succeed if the government invests in digital skills, provides services that encourage people to use them, and supports individuals as they adapt to new digital services.

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The digital world … why local government is still running to catch up

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By Steven McGinty

In 2015, one third of local councils were still running Windows XP, months after a public sector-wide support agreement came to an end. By failing to update their systems, these local councils increased their vulnerability to cyber-attacks, potentially risking the loss of data.

Although many would argue that not installing a supported operating system is a minor risk, it does highlight a more fundamental issue with local government: whether it’s making simple upgrades or delving into advanced ‘smart city’ technologies, local government is struggling to keep pace with the digital world.

Why should local government invest in digital?

Local councils in England are facing a 6.7% cut in their funding by Whitehall between 2016-2020. It’s expected that the majority of the cuts will come in the first two years, easing off in the remaining two. Additional funding measures have been put in place for social care, including enabling local councils to raise £2 billion by increasing council tax and providing access to £1.5 billion from the Better Care Fund (BCF). However, Chair of the Local Government Association (LGA), Lord Porter, has emphasised that social care will not see the benefits of this funding for a decade and in the short term, services will still be under pressure.

So, with this challenging financial context, local government is looking to redesign services, to create efficiencies and improve the experience for citizens. Embracing digital could provide some solutions.

Where could digital be adopted?

According to the National Digital Report, local councils are wasting two million man hours per year by re-keying data they receive through online services or a customer relationship management (CRM) system. The research shows that 50% of local councils are re-keying more than half of the data they receive via e-forms, creating £14 million in waste. It’s estimated that 11% of local councils are re-keying all their data.

In addition, a report by independent consultancy Bluefin Solutions has found that if local councils improved their access to mobile technologies, they could save £10 million per year.  Chris Smith, Head of Public Sector at Bluefin Solutions, suggests that allowing council employees to access information via laptops and other mobile devices is an ‘untapped’ opportunity for council leaders. The report provides further detail, highlighting that local councils should allow staff to complete timesheets via mobile devices, engage with collaborative platforms, digitise data, and introduce a Bring Your Own Device (BYOD) policy.

These are just a couple of examples of where technology- enabled savings could be made in local government.

Sounds great! Why hasn’t local government implemented more digital solutions?

Limited infrastructure

Although there are a number of initiatives to improve broadband services across the UK, a lack of connectivity is still an issue, particularly in rural areas. For smart city projects, Wi-Fi infrastructure needs to be in place to support millions of sensors and connected devices. And in remote communities, local councils need basic broad infrastructure to ensure they can implement digital solutions such as cloud services, as well as encourage mobile working.

Red tape

Unlike the private sector, local councils often face challenges with red tape and providing a business case, especially when investing in unproven technologies. Interestingly, though,  the Local Digital Today 2014 report found that the need to provide a business case for digital projects has slightly declined (falling from 85.4% in 2013 to 78.3% in 2014), suggesting that maybe digital technologies are gradually becoming more acceptable in local government. However, for the majority of local councils providing a clear business case can act as a barrier to digital change.

Funding

In theory, providing technical solutions to local government services should provide long term efficiencies. Yet, in an era of constrained budgets, finding the initial capital for digital projects can be challenging. Leaders in councils trying to fund social care services and schools may not view digital as a priority. And with the legal obligation to set a balanced budget, under the Local Government Act, councils are unlikely to fund projects with debt. Seeking external investment can also be a challenge, as (unlike start-ups looking to develop new technologies) local councils are unable to work with private sector organisations such as venture capitalists.

Local councils have also received no digital funding from the recent Autumn Spending Review – with all £1.8 billion being allocated to central government departments. Martin Ferguson, Director of Policy and Research at Society of Information Technology Management (Socitm), argues that investing in digital health without investing in digital social care means that efficiencies and improved outcomes for citizens will not be achieved.

Politics

The public sector has been scarred by failed high profile IT projects, including the abandoned NHS patient record system, which cost the taxpayer nearly £10 billion. As a result, local council leaders have tended to be risk averse and avoid investment in major digital projects.

Additionally, public concern over privacy, an issue raised when national ID cards were considered, has also impacted enthusiasm for digital. Even exemplar digital nations such as Estonia are underpinned by departmental data sharing agreements, which the British public may not be comfortable with.

Research has also shown that a limited understanding of smart cities by the public, has led to a lack of support. Local councils have therefore been reluctant to invest in projects that have limited demand.

Is devolution the answer?

In the Policy Exchange’s Smart Devolution report, co-author Eddie Copeland suggests that devolution might provide the tools to encourage greater digital progress. In particular, he highlights the ability city authorities will have to pool together funding from separate pots, co-ordinate initiatives at a city-wide level, and exploit the benefits of data through a designated Office of Data Analytics.

This won’t entirely address why local government has struggled with digital change. Yet, it’s possible devolution will provide greater opportunities for local government to embrace the digital world. Either way, it will be interesting to see what role digital plays in devolution deals, and how this will impact the lives of citizens.

Follow us on Twitter to see what developments in policy and practice are interesting our research team. Further reading: if you liked this blog post, you might also want to read our other posts on digital.