To meet increased demand for services in a constrained resource environment, governments must actively manage for innovation through technology. This must include exploiting opportunities that come with the greater availability of data and enhanced data analytic capabilities.
In the business world, companies know their customers. Segmentation — the capacity to understand customer groups and tailor products to suit the needs of each — is a central business strategy to increase sales.
In government, data can similarly be used to tailor service delivery – often to reduce interaction with citizens. Data also offers untapped potential to improve policy development. Data analysis should constantly inform government policies, particularly in areas of complex social policy such as Indigenous affairs and health.
The advent of ‘big data’, advanced analytics and greater computing power offers an opportunity to better understand citizens’ needs and behaviour. The government must keep pace with the private sector and take this opportunity to improve policy outcomes and services.
In going down this path, governments also need to safeguard the community’s trust. Australians know that governments already have access to vast amounts of data. As highlighted by research, in return for providing this information citizens expect their information to be secure and to know that it will be used reasonably.
There are three key changes needed to improve the government’s use of data to inform policy and tailor service delivery:
- a change in the mindset of government agencies from collecting data for filing to collecting data for use;
- an increase in data sharing, both within and outside government; and
- improved skills in the Australian Public Service to make best use of new data analytics tools.
The Commonwealth Government holds a large amount of data but does not currently use it to best effect. Some agencies collect data in the natural course of their operations and tend to focus more on collection rather than analysis and wider use. Other agencies have developed a number of data initiatives in isolation, which have provided key insights to only a small number of people.
The Commission notes that agencies’ efforts on data are rarely connected, sometimes duplicative and often of variable quality with inconsistent standards. The value of data holdings to the whole of government is rarely articulated and the Commission is advised that there has been no effort to undertake a stock take of data holdings or to assess their value.
As a first step in improving the use of government data, each major government agency should prepare a plan for making better use of its own data to inform government policies and services from within existing resources.
Data sharing also needs to be improved to facilitate innovation across agencies and from outside the government.
The Productivity Commission has highlighted that poor access to administrative data for government users, academics and other researchers is undermining evidence-based policy.
Unlike many other countries, Australia makes relatively little use of its public data resources even though the initial costs of making data available would be low relative to the future flow of benefits... A failure to exploit this evidence would be a missed opportunity given Australia’s demographic and structural budget challenges.
Data.gov.au provides downloadable public datasets from the Commonwealth, State and Territory governments as well as links to online data services provided by other government sources. The site is intended to encourage public access by providing data in useful formats and under open licences.
There are currently 3,164 datasets available through Data.gov.au. This compares to around 10,000 datasets in the UK and around 200,000 datasets in the US.
Despite the existence of Data.gov.au, the lack of publicly accessible Australian data in areas such as disability care, aged care, job seekers and disadvantage is hindering insights into whether some of the fastest growing government programmes are meeting their objectives or being delivered effectively. For example:
- administrative data could offer evidence about people’s use of income support, linked to health and incarceration data to identify better pathways out of disadvantage;
- greater linking of health data could lead to more efficient and targeted services, yet there are legislative constraints preventing Medicare Benefits Schedule and Pharmaceutical Benefits Scheme data combined for statistical research; and
- a lack of access to administrative data about Job Services Australia currently impedes research into the interactions between welfare and work.
The Commission considers the Government should do more to open access to its administrative data holdings, including medical data (the Pharmaceutical Benefits Scheme, Medicare Benefits Schedule and Medicare) and welfare and social data (social security payment data). At the State level, Western Australia has demonstrated that such administrative data can deliver substantial benefits with low risks, manageable costs and in ways that protect people’s privacy, for example, by anonymising data before it is released (i.e. removing identifiable personal details).
The Australian Public Service must also improve its capacity to undertake data analytics.
Data analytics involves analysing very large datasets in real time. This is sometimes referred to as ‘big data’ and offers the potential to draw insights and identify anomalies in government programmes and services to enable more immediate intervention. For example, in the United Kingdom, analysis of pharmaceutical prescription data showed excessive prescribing of brand-name cholesterol drugs in certain locations over cheaper generic alternatives, at an average cost of £27 million a month to the National Health Service.
The 2013 Australian Public Service Big Data Strategy offers a process through to mid-2014 to improve analysis of large government datasets. The Government has committed to review the strategy in 2014 and to seek proposals for joint private-public projects using big data that have promising efficiency or service quality payoffs.
The Commission supports the Government’s emphasis on big data. It considers that any new strategy needs to focus on the greater use of data analysis to improve decisions about new policy and programmes and the effectiveness of existing ones.
In line with its commitment, the Government should identify and prioritise several major ‘big data’ projects, spanning key service delivery bodies (such as the Department of Human Services, Australian Taxation Office and Department of Immigration and Border Protection) and complex policy and programme areas such as services to Indigenous people and health.
The Australian Bureau of Statistics and the Australian Statistician should play a leading role in developing and promulgating a data strategy for the Commonwealth, which includes improving the quality, timeliness and availability of data and boosting the capacity for data analytics within the Australian Public Service.
Recommendation 61: Data
There is untapped potential to use anonymised data and new data analytic techniques to improve the efficiency and effectiveness of government. The Commission recommends that the Government, recognising the need to safeguard privacy concerns, rapidly improve the use of data in policy development, service delivery and fraud reduction by:
- requiring major departments and agencies to develop plans to maximise use of their own-source data;
- extending and accelerating the publication of anonymised administrative data;
- prioritising several 'big data' projects in major service delivery agencies; and
- establishing a data strategy to be prepared by the Australian Statistician on the quality, timeliness and availability of data that would be suitable for public release.