Introduction
Governments have long been the victims of public scrutiny and criticism, and while a great deal of damage has already been done, the notion of transparency in governmental operations, along with access to information is still pretty intriguing. The idea of such open and accountable governance has its roots in the American & French revolutions which ultimately shaped way for rights to free speech, and rights to information as we know today. Fortunately, the open government proposition has gained significant momentum in the past few years. In fact, 96% of the countries in the world are currently working on an open government strategy, according to OECD. What’s promising to know is that governments have realized that this process of moving towards an open society requires an inclusive approach, one with a high degree of involvement from citizens and NGOs to ensure the very premise put forward by this phenomena.
Trust has never been more important for governments looking to expand the economy, and finding ways to improve citizen engagement and accountability. Around the world, governmental organizations have started using technology to enhance public services, and create customer-centric solutions. One of such technological innovations – Blockchain, sits at the intersection of trust, transparency, and accountability. Labelled initially as the engine behind digital currencies, blockchain has evolved into something of a revolution. Now termed as a disruptive force on the verge of replacing existing infrastructures of almost every industry, and set to transform the public sector. As per IBM’s recent study Building trust in government, nine in ten governmental organizations globally plan to invest in blockchain for use in financial transaction management, asset management, contract management and regulatory compliance by 2018.
The rise of an Open Standards
In the most ideal of situations, the access to information should not be limited to government entities and few corporations. With public trust in such established institutions tumbling every day, the issues of governance have become even more desperate. For governmental services to evolve and produce maximal benefits for the citizens, they will have to go through an open, trusted and transparent ecosystem. Open standards serve as excellent starting points for public services, and can be leveraged to create solutions which result in maximizing overall prosperity. These include of 4 subsets – Open Data, Open APIs, Open Innovation, and Open Sourcing.
Open Data
Open Data consists of any piece of data which is free for use, reuse, and redistribution. For citizens, open data can serve as way for better understanding the issues they care about the most, such as education, health care or housing. Quite understandably, not all data sets can be shared with the public. The idea through open data should be to develop an ecosystem consisting of data advocates, producers, and users and build trust with it.
EXTRA: Application of Open Data
- Under Obama’s administration, the U.S. govt. introduced the Open Data initiative back in 2013, with the aim of empowering citizens to make more informed decisions. While data-driven decision making is central to this, it also creates numerous opportunities for leveraging these open datasets to create valuable solutions.
- Latin American’s open data movement has seen a huge rise in the Civic Tech community – groups who use this data to develop digital solutions based on the requirements of people who need them.
Open APIs
An API (Application Programming Interface) is a set of commands, functions, protocols, and objects that programmers can use to create software or interact with an external system. While data perfectly serves the informational purpose, open APIs enable developers outside the organization (in this case government) to build upon the existing systems to create innovative solutions. Open APIs can allow governments to go beyond their internal capabilities, and build differentiated experiences for their citizens, also promoting civic engagement in doing so. Quite understandably, open APIs are also associated with huge cost & time savings.
Open Innovation
To address complex civic challenges, it would make great sense to involve all stakeholders to design and implement solutions in a collaborative manner. This is where the concept of open innovation steps in. Public services are traditionally implemented by a group of selected public officials and hence fall short of expectations most times. Allowing people who directly benefit from these services to participate, can result in a more tailored approach while designing public services. By partnering with municipal and country leaders, the World Bank is pioneering and validating open innovation approaches in countries such as Chile, Colombia, Egypt, and Lebanon.
Open Sourcing
The term “open source” basically refers to something people can modify and share because its design is publicly accessible. In that sense, open source software are source codes that are publically available and can be used for further modification as well as distribution. Open sourcing software has multiple benefits whenever technology is the key to solving problems or expanding services. The ability to modify the basic source codes enable developers to design the software to fit the needs. Open source software also reduces lock-in to a particular solution and a particular vendor, which means more competition, lower costs, and higher quality products.
The curious case of Hackathons
There is no better example of civic engagements than a Hackathon, which is basically when groups of software developers, entrepreneurs and government officials come together to look for new solutions to established problems during the course of a day or maybe a long weekend. Hackathons are a great way for people with technological ability to come together and collaboratively create solutions for the greater good. Government organizations have realized this, and have started using hackathons to greater effect. By sharing municipal data with tech enthusiasts, governments enable civic hackathons help put open data into public use. In essence, civic hackathons are built along upon the idea of Open Government movement which aims to redefine the relationship between governments and citizens by, among other things, making information about government services, activities and spending more available and understandable for the citizens.
The growing popularity of civic hackathons seems to be step towards broader civic engagement. Not only do these meet-ups help to activate open data use, civic hackathons create a useful channel of direct feedback from data users to government staff. And as open data communities are maturing, there is an emergence of various other innovative events which involve the use of open data techniques. For instance, a community in Ottawa has introduced an open data book club where people meet to discuss a particular data set. Such activities indicate that the citizens have an interest in open data and its applications, beyond just tool development. If the civic hackathon movement continues to grow at the current pace, it would not be surprising to see such events to be at the center of major public planning.
So what really is Blockchain?
Despite of all the buzz around its complexity, the concept of blockchain is rather easy to understand. For years, governments and business organizations have been using ledgers to record the transactions relating to various assets and liabilities. But these ledgers are subject to both human error & fraud. Enter blockchain, a distributed open ledger itself that creates a secure digital alternative and hence does away with issues such as time-consuming, paper-heavy, and expensive, and prone to frauds associated with existing ledgers. But how? Think of it as a digital database which requires every transaction to be encrypted before being recorded on it. Moreover, all transactions are needed to be encrypted in a logical sequence, which makes it tamper-proof. Another major feature of blockchain is the absence of any authority overseeing the transactions, and thus making free of counterparty risk.
How does Blockchain stimulate Open Governance?
Blockchains are essentially distributed databases that can be used to record pretty much record and track every transaction relevant to the governments including property transactions, medical records, citizen identities business licenses, vehicle registrations and much more. With its compelling decentralization proposition, blockchains have the ability to provide a secure, transparent and open view of activities, information and decisions, fueling an open innovation culture and reinventing government services. With growing open data initiatives it becomes necessary for governments to ensure this data is easily accessible, free to use, and unobstructed by malwares. Open data on blockchains meets these requirements, and can help governments become open governments.
Trust
When recording transactions on the blockchain, only individuals involved, and not a third party will determine the entry. Every participant on the blockchain will have a copy of all transactions, which makes it virtually impossible to tamper with. In cases of counterfeits, blockchains can easily identify if the source can be trusted or not. One of the major applications of Blockchains to enhance the trust economy, is digital identities. Governments have traditionally been issuing and monitoring the IDs of its citizens through computer systems which are vulnerable to hacks. But blockchain can help governments introduce digitally-issued identification, creating a safe and secure mechanism. An identification as such can be accessible anywhere in the world and would allow individuals to prove their identity, connect with family members and even receive money without a bank account. The use of blockchains in major public services will allow for secure data sharing between government and its citizens and in turn serve as a catalyst for public trust in the government.
Transparency
Blockchain provides a new approach to enhancing transparency and collaboration between governments and its citizens. Recording information sets on a distributed shared ledger promotes public visibility in the government processes. Vital information can be universally shared, seamlessly stimulating true openness. While transparency does not really favor the concept of privacy in every scenario, blockchains have the unique ability to ensure high levels of privacy along with greater transparency. For an open ledger to create such disruptive amount of transparency is perhaps this is one of its most interesting characteristics and has the ability to break down bureaucracy between government and the citizens.
Accountability
The occurrences recorded on blockchain never go away, they exist forever in a distributed database. In that way, blockchain ensures a single version of the truth. Governments, since they are the representatives of the citizens, should be held accountable for the decisions they take. The adoption of such a technology within the government would allow the communications between councilmen and other government officials, recordings of public meetings to be stored on the ledger forever, providing true accountability to the citizens. The data stored will be irrefutable, and will give rise to a system based on truth and responsibility.
Is this already happening?
Dubai – Global Blockchain Council
Dubai has set up the Global Blockchain Council to explore current and future blockchain applications. The council currently consists of 47 members from both the public and private sector and launched seven blockchain proofs-of-concept trails, covering health records, diamond trade, title transfer, business registration, digital wills, tourism engagement and shipping.
IBM has partnered with the Dubai government to trial the use of blockchain for a trade and logistics solution. The solution transmits shipment data, allowing key stakeholders to receive real-time information about the state of goods and the status of the shipment, and replaces paper-based contracts with smart contracts.
The Crown Prince of Dubai has also announced a strategic plan that would see all government documents secured on a blockchain by 2020. The Dubai government estimates that the blockchain strategy has the potential to save 25.1 million hours of economic productivity each year.
Estonia – Blockchain identity management, e-voting, electronic health records
Estonia is considered to be a leading nation in the adoption of blockchain technology. Estonia citizens and e-residents are issued a cryptographically secure digital ID card powered by blockchain infrastructure on the backend, allowing access to various public services. On a blockchain platform, citizens can verify the integrity of the records held on them in government databases and control who has access to them. Earlier this year, Nasdaq successfully completed a trial in Estonia that will enable company shareholders to use a blockchain voting system.
Estonia is also adopting blockchain technology to secure the country’s 1 million health records. Every update and access to healthcare records is registered on the blockchain, preventing medical fraud and making it impossible for hackers to hide their trail. It also provides real-time alerts to attacks, enabling the government to respond to incidents immediately before large-scale damages occur.
Singapore – Blockchain interbank payments
The Monetary Authority of Singapore (MAS) has successfully completed a proof-of-concept pilot to explore the use of blockchain for interbank payments. Partnering with a consortium of financial institutions, blockchain infrastructure was used to produce a digital currency issued by MAS and methods were tested to connect bank systems through distributed ledger technology. The technology will simplify the payment process, reduce time take for transactions, enhance transparency and system resilience and reduce the cost of long term record keeping. MAS is currently developing links from Singapore to other countries to enable DLT cross-border payments, and will test blockchain technology for bond trading. MAS is looking at this project as the first step in leveraging Blockchain to verify and reconcile trade finance invoices, verify the performance of contracts, keep an audit trail and deter money laundering
Conclusion
Disruption, especially in bureaucratic institutions is rare. That could change as blockchains evolve to bring closer collaboration among citizens and government institutions. Through blockchain technology, government will be better able perform its dual role of facilitating the business innovation of citizens and, at the same time, co-creating better services for citizens, founded on openness and trust. Open data (e.g. data that helps pinpoint the optimal location for a new retailer or record soil conditions for farmers) is arguably among a government’s greatest assets. As the societal value from that data grows, government organizations will need to ensure that their data is easily accessible, free to use and available in a consumable format. Likewise, institutions will need to take greater safeguards to protect that data from cyber-attacks.
