Innovation sits at the heart of how the public sector is redefining itself, focusing as it must on doing more for less. FinTech developments are central to this reinvention. In a report written for government and published last year, chief scientist Sir Mark Walport suggested four new technologies that the public sector should take on board: machine learning and cognitive computing; digital currencies/blockchain; big data analytics; and distributed systems.
The use of blockchain – a distributed ledger technology (DLT) with shared records – is moving forward rapidly. Blockchain provides an undeletable audit trail of transactions, potentially making fraud both more difficult and easier to trace and prosecute. But blockchain also offers faster transactions, greater efficiency, lower cost and the elimination of system weak points. It could revolutionise public record keeping.
Sir Mark Walport explains: “Distributed ledger technology has the potential to transform the delivery of public and private services. It has the potential to redefine the relationship between government and the citizen in terms of data sharing, transparency and trust and make a leading contribution to the government’s digital transformation plan.”
Darra Singh, EY’s head of government and public sector at EY, agrees: “Blockchain is set to have a huge impact on the public sector. It can enable the delivery of a wide variety of services, such as collecting taxes, delivering benefits, issuing documents and recording properties in a more effective way.
“On a practical level, there are several core areas where blockchain technology can have a significant impact on government and public sector organisations. For example, reducing operational costs by simplifying and increasing transaction processing speed, as well as improving customer service and experience by reducing administrative burdens, but also preventing fraud especially with regards to money laundering.
“The government has an important role to play in unlocking the potential of blockchain. It should act as an early adopter – improving how people access services, and guaranteeing robustness and security. They should also facilitate its adoption through creating regulatory frameworks, setting standards to ensure security and privacy as well as building trust and compatibility with existing non-blockchain systems.”
Jerry Norton, vice president of financial services at CGI, a business process provider, adds: “A number of people think there are a greater number of applications in other sectors, including the public sector, than in the financial services. It is an issue of maturity. In FS we have been looking at this for three and a half years, so we understand where we can use it and where not, but in the public sector it is a lot less mature. We have only just embarked on it.
“The attributes are that it lends itself to applications which are widely distributed to different parties, who may not belong to the same organisation. They are often not frequent transactions for one individual, but there are a lot of transactions, and you have to prove that someone has got it.
“One example that CGI has been looking at in the US is healthcare and prescriptions. Paper prescriptions can be altered and there are payment processes around these, where there can be fraudulent issues. A blockchain application means I can effectively digitalise the document, I can create a hashtag about that document, I can move it around electronically and prove through the blockchain that you have got it, that you haven’t altered it, that you haven’t used it twice and that you have paid for it. Another example that CGI is looking at in the UK is in the criminal justice system, where data is exchanged – you have to prove someone has got it, that it has not been altered and also ensure that the data has not been destroyed.”
Disc (previously known as GovCoin) is using blockchain in a trial for volunteers who receive benefits from the Department for Work and Pensions. Participants can download an app which improves their capacity to budget their spending, through the allocation of money into ‘virtual jam jars’. Disc says that if the project moves beyond pilot phase, it could improving payment accuracy and reduce the cost of fraud and error. Critics have feared the app would allow ‘big brother’ monitoring of claimants’ spending patterns, but the trial data cannot be accessed by the DWP.
Work and pensions minister Lord Henley reported to Parliament on the trial in March this year, saying “the initial independent assessment of the small-scale trial has been positive…. It was a very small trial, involving only some 20 to 30 people. It was more what I think is termed a proof of concept rather than a trial, but it produced encouraging results and we want to look at those in due course.”
Disc – which is backed by Barclays and RWE npower – is also being used by the Commonwealth to combat cross-border crime. Its app creates a secure messaging system to help law enforcement and prosecutors in different Commonwealth countries co-operate more effectively on criminal investigations by providing a secure and fast communication platform for the exchange of information between jurisdictions.
Many public services are essentially transactions of various types – which means that blockchain has a massive potential for improving efficiency.
The DeepMind collaboration is another example the UK public sector’s engagement in state-of-art innovation – in this case bringing together artificial intelligence (AI) with smart phone apps. DeepMind was founded in London in 2010, acquired by Google in 2014 and now part of the Alphabet group. In November last year it entered into a five year partnership with the Royal Free London NHS Foundation Trust to develop a mobile clinical app called Streams. This app is intended to ensure that the right clinician attends the right patient at the right time. The technology notifies nurses and doctors immediately when test results show a patient is at risk of becoming seriously ill and provides the information they need to take action. This should speed-up the time it takes for clinicians to attend and treat patients and improve clinicians’ time management. As the app develops, additional features will be added, including advanced clinical task management. Critics have complained about access to patient identifiable data by commercial businesses.
Paul Gosling, journalist