UK could save £24bn a year if it creates a ‘digital, full stop’ government

The UK government should move from its ‘digital-by-default’ strategy to ‘digital, full stop’ in a bid to save up to £24 billion a year, which could be used on public service expansion and/or deficit reduction plans.

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The UK government should move from its ‘digital-by-default’ strategy to ‘digital, full stop’ in a bid to save up to £24 billion a year, which could be used on public service expansion and/or deficit reduction plans.

Independent think tank Policy Exchange has released a report this week, called ‘Smaller, Better, Faster, Stronger’, which makes the case for embracing “government as a platform”. It argued that Whitehall should eliminate all paper for interaction within and between departments, and switch exclusively to digital channels for public services that do not need a face-to-face interaction.

The government has already released plans to digitise some of the most popular transactions carried out by the public, such as paying car tax or booking driving tests, in a bid to save up to £1.7 billion a year after 2015.

Key technology players within the Cabinet Office and the Government Digital service (GDS) have been working hard to ensure that costly legacy systems will be replaced with innovative new online products, which create easy access for the public and save the public sector millions.

The government hopes that many of these initiatives will be carried out by SMEs that typically work in an agile and lean manner, and will allow a better balance between smaller British businesses and the typical ‘oligopoly’ of suppliers.

Much of this is being allowed through the introduction of the G-Cloud and Digital Services Frameworks, which have helped give SMEs direct access to government business and have increased transparency in pricing for Whitehall.

Reform has been rapid in recent months and the moves have begun to ruffle the feathers of some of the biggest, more traditional, suppliers to government. For example CGI, previously Logica, has warned the Cabinet Office that if the pendulum swings too far in favour of SMEs, then bigger companies will begin to take investment elsewhere.

Policy Exchange, however, argues that the digital transformations of government should be accelerated and that there is a “huge economic opportunity” for the UK if it embraces the concept of “government as a platform”. The report states that the government has been spending too much on IT in the past - by 2010 Labour was spending £25 billion a year on public sector IT, with some departments spending more a year on IT than Google.

It also found that between 1997 and 2010 some 70 percent of IT spending went to just seven companies, which has driven down competition for IT contracts, increased costs, and locked out SMEs from doing government business.

To move away from this culture the think tank believes that the UK should adopt electronic purchasing to make procurement more efficient, as well as introduce electronic proofs instead of paper certificates for citizens, so that people can do things digitally even when they are asked to provide proof of identity, address, qualifications, P45 and so on.

Chris Yiu, author of the report, said: "The public sector has historically been slower and less effective when it comes to taking advantage of technology, data and the internet. The web is already inseparable from most people's day-to-day lives, and this will only increase in the years ahead.

“Switching to digital for everything the government does would generate billions of pounds worth of savings that could be used to cut the deficit or improve public services.”

He added: "Government is changing, but the world around it is changing faster. With the internet all around us, it's reasonable to expect government to embrace digital. Our public leaders need to rise to the challenge, or risk a chasm between new and old tearing the whole system apart."

Yiu would also like the government to move from open data as a “fringe activity”, to “total data as a guiding philosophy” by 2020. It should open up all non-personal public sector data with persistent uniform resource identifiers, which should provide a foundation for accountability and economic growth.

For example, if Whitehall introduced lean-start up methods as a preferred way of working and incorporated digital and data skills into the Civil Service competency framework, it could then establish controls to ensure policies can be tested against data.

He believes that doing this should result in better outcomes, delivered more quickly and with less risk.

The report highlights that the biggest challenge for government is around people, leadership and organisational change. Policy Exchange states that by 2020 the government needs to have developed “more outstanding leaders” to push the digital agenda.

Government should increase interchange so that most senior staff have recent external experience, agues the report, and introduce more fixed-term appointments for senior staff, so that people are absolutely clear on their objectives and have a strong incentive to master digital tools and approaches.

The report states: “For people working in government, openness, excellence and innovation must be the norm at all levels of responsibility.”

Yiu would also like Whitehall to create a ‘LinkedIn for government’, so as to make it easier for employees to find out who does what, and encourage more open policy making and collaboration. He also believes that the government should enrol the top 10 percent of staff at all grades in an explicit innovation drive and allow more teams to spin out their activities in partnership with UK technology start-ups and other partners.

Mike Bracken, executive director at the Government Digital Service, said: "We've made huge progress since setting up GDS, working with other departments to release GOV.UK and start making services digital by default. But there is still significant potential to drive digital into everything the government does.

“This report is a timely reminder that our digital journey is only just beginning, and should inspire everyone in government to aim high when deciding where we go next."