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Briefing paper

With the 2016 distributed denial of service attack on Australia’s first fully digital Census and Centrelink’s 2017 automated debt-recovery system glitches still fresh in our minds, it would be easy to pause in the pursuit of digitising government services.

The reality, however, is that there are compelling benefits to expediting government digital transformation, and the case for change is not simply one of customer convenience.

Deloitte Access Economics has estimated that the federal and state governments conduct 811 million citizen transactions each year. It calculated that lifting the share of transactions performed digitally from 60% to 80% over a 10-year period would lead to government productivity benefits worth $17.9 billion, plus a further $8.7 billion in benefits to citizens. 

But the benefits of integrated digital government services extend even beyond time and resources saved. Data is the fuel for many new business models and, according to OECD measures, right now Australia performs only moderately well compared to international peers, particularly in relation to the availability of open government data.

The OECD has estimated that adopting more data driven decision-making in government has potential output and productivity benefits of 5% to 6% in the US, while improving data quality and access by 10% could increase labour productivity by an average of 14%. That can have additional flow-on effects across the economy. Almost 2 million people are employed in the three levels of government in Australia, meaning that 16% of the country’s 12.5-million-strong workforce is employed in the public sector.

This represents a strategic capability, enabling knowledge and skills transfer across the broader economy. Based on previous productivity gains from technology take-up, that can have significant benefits for Australia’s output. Further adoption of digital technologies across the economy has the potential to add an extra $66 billion to Australia’s GDP over the next five years alone.

So the case for change is clear; the question is really about how to do it. How do we maximise the opportunities, while best protecting citizens’ data and privacy? This policy brief is intended to start that conversation.

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