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Lessons to Learn From New Zealand’s Digital Government Revolution

New Zealand is known for its prowess at rugby and for the iconic Lord of the Rings trilogy that was filmed there. But it’s also a trailblazer when it comes to the world of digital government

New Zealand is the fastest-rising country in the annual International eGovernment Rankings which currently rates the country as the ninth-best nation in the world in terms of digital governance.

New Zealand has a stated aim of becoming fully digitally integrated by the end of 2017 – and is well on track to do it. Any new interactions a citizen will have with their government are designed as digital processes first and foremost.

New Zealand’s Interior Minister Peter Dunne took to his feet in Westminster – the seat of British power – to share insights on his country’s digital strategy. He had much to teach the British – and everyone else for that matter – about how to successfully manage the process of digital government.

Why is New Zealand Flourishing?

So why has New Zealand found so much success in a space where so many other governments are failing? Traditionally, the problem with moving government services online is that the services are laden with historical processes that create an inordinate amount of work.

On top of that, it can be incredibly frustrating for the end-user because there are loads of similar websites offering separate solutions with the absence of a centralized hub.

At first, it was much the same situation in New Zealand. Like many other governments across the world, there was a rush to get everything online at once. This led to a situation where the government described its own digital presence as “a mess” in 2014.

There were over 550 separate sites using the govt.nz domain which cost over US$54 million per year to maintain.

The Department of Employment had over 70 sites alone – each focusing on a disparate strand of job creation, social employment or entitlement schemes.

Fast forward three years and the official New Zealand government site is the central hub where citizens can complete most of their interactions with the state including:

  • Applying for government jobs
  • Renewing a passport
  • Registering a company
  • Applying for construction permits and licences
  • Applying for birth certificates

“The driving question for us [was] why should our citizens trek from agency to agency providing the same information over and over again when they can order their groceries, book holidays and pay their bills with just a few clicks online?” Minister Dunne said.

“If your pet food, nappy or contact lens supplier can remind you to reorder before you run out, why can’t your government let you know your entitlements before you have to ask?”


The Simpler Approach

There was a significant cost-saving aim permeating New Zealand’s approach to simplifying the process of interaction between citizens and officialdom, particularly around the area of licencing.

Driving licences, hunting licences and even licences for mining rights can be completed painlessly through the official government portal.

Different licenses, permits and grants are traditionally required and issued by various and separate governmental departments. Completing all the bureaucratic paperwork increased the chance of human error. These errors – as well as causing havoc for the citizen involved – often need rectifying, which incurs a significant cost.

Another problem when it comes to licenses in particular is that compliance levels can be quite low – especially after the first licence is issued. Renewal notices tend to be ignored.

With its new system, the New Zealand authorities automatically know when renewal is due and compliance can be monitored instantly.

Huge Cost Savings With eGovernment Solution

New Zealand is saving “$70 million NZD ($50 million USD) a year on products and services across the system,” according to Minister Dunne.

The cost savings are obvious and replicated around the globe in a plethora of eGovernment projects. In the US alone many states are starting to see the ROI of eGovernment investment:

  • The state of Utah compared its costs when it came to paper transactions versus digital transactions. The average cost of paper (or offline) transactions was $17.11 per interaction. When it came to completing the same transactions online, the cost dropped to $3.91 on average. That $13.20 is a saving of 77 percent.
  • The Florida Inspector General’s performance audit revealed that the average per unit processing cost was $4.18 for over-the-counter payments but only 77 cents when it came to processing electronic payments. That represented a saving of 82 percent.
  • The state of Tennessee reported that its average online transaction cost was $1.09 as compared with the offline cost of $4.32. Moving these services online represented a 74.5 percent saving.

The New Zealand government took the approach of putting the needs of its citizens at the heart of its digital strategy. This sounds straightforward but was a unique opportunity to escape the institutional inertia that governments can suffer from.

Tom Loosemore, deputy director of Government Digital Services in the UK, says the biggest obstacle in transferring services online is “the existing process for how things happen”.


A Lifelong Involvement

The New Zealand approach instead envisions a lifelong involvement with State services. Minster Dunne explained this holistic approach.

“The future we see – and it is not far away – literally starts when a child is born,” he said. “Throughout that person’s childhood, their parents will be prompted and connected with all of the various services their child will need, for example: their health number and tax number, reminders for immunization and medical check-ups, information about family support entitlements.

“As the child grows, parents and the child will be able to access school information and results and register for further education. Significant birthdays would trigger more prompts, for example: to apply for a learner driver’s licence, to take over managing their own identity, and to enrol to vote.

“And when they reach 65, this generation should never have to apply for their superannuation – we will proactively let them know when they are eligible and how much they will receive.”

Impediments to eGovernment Progress

Of course, for many governmental organizations there are legacy issues, cost issues and implementation worries.

However, if the business case for digital government is so compelling, as New Zealand has illustrated, why have so many eGovernment projects stagnated, ran aground, and failed to justify their investment?

At a broad stroke, the impediments to launching digital government include:  

  • Getting the critical mass of online services online so citizens feel compelled to use them or so they feel that they’re missing out by not taking advantage of the services.
  • Policy decisions, or the lack thereof, budgetary constraints, and lack of investment to build, launch, maintain, and promote online services. 
  • Having the expertise to identify, create, run, and administer evolving online services while keeping abreast of shifts in technical standards and protocols, social trends, and remaining sensitive to customer expectations. 

Most governments, especially at a local or regional level, lack the deep skills to build, for example, cross-platform mobile applications, secure cloud computing facilities, or create identity management systems as pillars to support online service initiatives.

Private sector partners can offer these skills in tandem with low-risk business models protecting governments from financial overspending and controlling capital expenditures. 

New Zealand leads the way – but there’s no reason for any other state body to fall behind.

See How You Can Manage Your eGovernment Transition

If you’d like to know more about Escher’s eGovernment solutions, talk to an eGovernment expert about your project at one of our US offices.


Tags: Digital Identity