Transforming the public sector through IT

Aim of digitising govt processes is to improve ability of all people to access information, efficiency, effectiveness.

The birth of modern information technology (IT) has transformed the world and how we, as individuals, live and interact with not only one another, but with organisations and structural systems. From banking to manufacturing to managing businesses, processes and services are becoming increasingly automated. The primary function of labour today is to operate the machines and systems that perform complex procedures and computations.

We are now seeing a paradigm shift in mechanisms that drive economic expansion. In the first half of the previous century, manufacturing was the driving factor for this expansion. In the last three decades, the service sector emerged as the major driving force of global economic expansion. This was particularly true of financial services, which exploded in the 1990s and found support in the growth of IT and better computation and communication systems for data. This shift happened in an environment of unprecedented competitive pressure, innovation and customer expectations. Formerly a back-office support system, IT has today become a market differentiator. A simple example would be the groundbreaking creation of the Automated Teller Machine that gives us basic banking services around the clock. Before this, banking services were only available when banks were open.

This trend is expected to accelerate globally due to the increasing number of public sector organisations around the world that are also turning digital. Pakistan, however, when compared with other with similar resources, is still lagging far behind in this regard. The adoption of efficient IT systems is still fairly uncommon, especially within the public sector. This begs the question: why is it important to integrate IT innovation into the public sector? The answer is simple. Even though state actors, unlike their counterparts in the corporate world, do not have to face direct pressure from market forces, they still have to deal with the complexities of legislative mandates and public expectations.

Within the framework of a changing global paradigm, the fact remains that the vast majority of IT systems used by Pakistani public sector organisations are either inefficient or altogether obsolete. Most data storage and sorting tasks are still done manually — increasing the incidence of bad practices and their resulting inefficiencies — which, in turn, results in loss of government revenues and general public dissatisfaction. Recently, the federal government took note of this and began looking at ways to digitise and regularise metre reading and data architecture because of an increase in complaints about wrong or extortive electricity metre readings. Simply put, in a country where corruption is rampant, it’s recommended to have automated systems that are monitored by independent third parties, rather than the incumbents.

In a practice guide published by the Australian National Audit Office, an Australian auditor general defines innovation in the public sector context as  “creation and implementation of new processes, products, services and methods of delivery that result in significant improvements in the efficiency, effectiveness or quality of outcomes”. This is an excellent description of how the public sector must work towards meeting the public’s ever-increasing demands for new and better services, and  improving the productivity of their organisations by eliminating inefficiencies caused by human errors and outdated systems. This requires government executives to leverage IT to create organisations that can respond speedily to a changing socio-political environment.

Unlike the private sector, innovation in the Pakistani public sector has suffered not only from a lack of research, but also from a lack of recognition of the importance of the digital revolution. Innovation was usually seen as a supplement to the main role of public sector activities. To counter this, it is essential for public sector organisations to use technology to support their businesses and delivery processes. The Federal Board of Revenue is currently leveraging a tax base of just over 16 per cent according to most estimates. Applications that reduce tax evasion and expand the tax base would exponentially multiply the revenues the government can collect. A large part of why the tax base remains so limited is because of the unavailability of integrated tax systems, human error, not to mention corruption.

According to official estimates, corruption alone costs the national exchequer Rs12 billion in daily losses. These losses can be offset to great extent by an expanded tax base while allowing officials to electronically monitor returns and see if they are in line with projections. Electronic tax returns, for example, make it easier for citizens to pay their taxes and will also allow authorities to eliminate the possibility of fraud and tax evasion. At the same time, the government saves millions of rupees in processing manual returns. The basic aim of digitising government processes is to improve the ability of all people to access information and to enhance the efficiency and effectiveness of all kinds of government services.

One of the major predicaments that the Pakistan government faces on this front is the limited amount of investment it can put into installing better technology systems in public sector organisations. A solution to this predicament is public-private partnership. The private sector has proven time and again that technology-fueled transformation is possible. Companies in many industries have redesigned and automated their business processes. Government institutions, by collaborating with the respective private sector organisations, can create value from IT that goes far beyond cost reductions and process improvements, such as starting up initiatives that may lead to new products and services. Another opportunity that may arise as a result of these collaborations is that rather than building and maintaining multiple new systems, they can identify, streamline and use common components of relative systems.

As the world becomes more and more digitised, it is imperative that the public sector starts integrating technology into its systems and processes to build the capacity to serve its citizens better.

Published in The Express Tribune, October 31^st, 2013.

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