Technology in a Cold Climate: Public Services

Helen Margetts

This paper examines the potential for digital technologies to equip public services for survival in current
economic conditions. Over the last decade, during which Internet penetration in the UK has grown to 70
per cent, the UK government has made many significant moves towards ‘digital-era governance’. But
departments have also been troubled by large-scale project failures and there remain missed opportunities
in terms of using the newest Internet-based applications to create efficiency savings and to innovate in the
design of public services. The paper suggests three ways that government could reap greater benefits
from its substantive investment in digital technologies. First, by applying a ‘small is beautiful’ policy to
contract relationships with computer service providers and moving away from the ‘big database’ approach
favoured by policy-makers, UK government could improve e-government performance. Second,
government could drive up the usage of and cost savings from e-government by segmenting citizens
according to their Internet usage and skills and applying differential incentivization strategies to different
groups. Third, government should use ‘Web 2.0’ applications to capitalise on the many ways in which
citizens themselves are generating content on the internet in other sectors to co-produce and even co-
create public services.

Digital technologies, particularly the Internet, offer much to government in terms of providing cheaper and
more efficient government services, improving the quality of government administration and facilitating
innovation in both policy-making and service provision. All governmental operations are now heavily reliant
on one or more major computer systems and the Internet – the first digital technology which citizens are
using more than the state - offers real possibility for transforming the way governments and citizens
interact. UK government has made great strides in incorporating digital technologies into government, but
has also struggled to extract these benefits; the history of government computing is littered with failed
projects and troublesome contracts and the ways in which citizens can deal with government on-line fall
somewhat short of what they experience when interacting with firms, social enterprises and each other.
This short paper outlines the history of government computing and current policy, argues that it is time to
bring digital technologies to the centre stage of public service reform and puts forward three ways in which
government might realise the potential of digital technologies to provide better (and cheaper) government.

Current Policy
Technology has been entwined with governmental processes ever since computer systems were first
developed by and for British government from 1950s onwards. By the 1980s, the operations of every
department and agency were heavily dependent upon at least one computer system and the largest
administrative departments used complex networks of systems to deliver benefits, collect taxes and
process resources. These systems have been shown to be policy critical, with implications for all four of
the ‘tools’ of government policy (Hood and Margetts, 2007) and policy innovations, such as the Congestion

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Charge and the Oyster card system for public transport in London highly dependent upon their successful
development and interaction.
Widespread use of the internet (internet penetration in the UK has now reached 70 per cent) means
that digital technologies are even more crucial for government in the UK and many other countries. While
earlier information technologies were largely internally facing, with few implications for government-citizen
interactions, the internet is the first digital technology which citizens use on a massive scale. As
populations started to shop, bank, entertain themselves and interact with each other on-line from the late
1990s, they increasingly expected to interact with government on-line as well. From the mid 2000s, so-
called ‘Web 2.0’ technologies allow users of web sites to generate content themselves, for example
through posting comments, photos or videos. Famous applications include social networking sites (such as
Facebook, LinkedIn and MySpace); photo and video-sharing sites such as YouTube, Flickr and I-Tunes;
discussion and comment sites such as Twitter; the user written encyclopaedia Wikipedia; sites where
consumers may ‘feedback’ their experiences, such as Tripwise (for holidays) and Amazon (for books);
blogs (where any Internet user can create their own on-line space for news and comment); and ‘mash-ups’
which draw in information and data from a range of other sites, often user-generated. These applications
have had a dramatic effect on how people use the Internet, making it far more likely that Internet users will
produce as well as merely consume content, drawing citizens into the ‘front office’ of many organisations.
Indeed by 2009, over half of Internet users had undertaken some kind of productive activity on the Internet,
such as creating a profile or personal website or posting messages or comments on blogs or other
discussion forums online (Dutton and Helsper, 2009).
The UK government has responded to this technological shift in the population with a series of ‘e-
government’ initiatives. In one sense e-government, defined as the use by government of information
technology internally and to interact with citizens, businesses, voluntary organisations and other
governments, has existed since the first computers entered government, but the internet made the topic
more appealing to policy-makers and analysts alike. In 1999, the Labour government along with many
countries created targets for e-government, promising that by 2005 all transactions with government would
be available electronically, and created the Office of the e-Envoy (OeE) in the Cabinet Office to achieve
this goal. The OeE at its peak employed around 250 staff and incurred annual running costs of around £50
million; by 2002, the UK was committing more resources centrally to promoting the delivery of electronic
services than other similar countries. By 2009 the fever had dimmed somewhat. In 2004 the e-
Government Unit replaced the Office of the e-Envoy with a different remit and a far smaller budget; in 2007
the Unit was itself subsumed into the ‘Delivery and Transformation Group’, with more general ‘good
government’ aims and less emphasis on technology (the assumption being apparently that e-government
had been achieved and it was time to move on). At the same time, and in a move divergent to most other
governments, on-line government was to be centralised in two ‘super-sites’, www.direct.gov.uk for citizens
and www.businesslink.gov.uk for firms. The total annual IT expenditure for central government was by now
around £6.5 billion (Dunleavy et al 2007). Within that figure, the cost of directly running government
websites was around £208 million (ibid: 23), a surprisingly small amount given their strategic importance.
These web sites act as an electronic ‘window’ on government, which for significant and growing numbers
of people is the only part of government with which they interact.

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 Meanwhile, other moves indicate continuing enthusiasm for the potential that newer internet-based
technologies provide. In 2007 the Cabinet Office published an independent report by Steinberg and Mayo
(2007), entitled The Power of Information, which promoted government development of user-generated
websites, and by 2009 it was possible to point to some examples initiated by government organisations.
The NHS has invested substantially in the NHS Choices site, which provides users a chance to rate and
rank hospitals and the healthcare that they have received. In 2009, the government announced that it was
planning to extend these types of opportunities for user feedback, ranking and posting comments across
other sectors such as education, and the Conservative opposition was equally enthusiastic about the
possibilities offered by these technologies. Gordon Brown as part of various reforms announced after the
2009 MPs expenses scandal, recruited Sir Tim Berners Lee (the original architect of the World Wide Web)
as an advisor on public sector information and the development of future versions of the Web.
How might we evaluate the performance of UK e-government and its potential to help public services
winter the current climate? The performance is somewhat mixed. On the one hand, it has clearly received
sustained (although recently, rather diminished) political attention over the past ten years, with sustained
financial commitment. There have been some notable successes; the application which allows car users to
purchase road tax on-line for example, is used by many millions of citizens and has received universal
approval. With respect to usage of e-government, the UK government has finally started to accelerate,
after a slow start. In 2005, only 39 per cent of Internet users reported some kind of e-government
interaction in the last year, up only marginally on 2003, most of which were for information seeking; only 6
per cent were for transactions such as paying for government services, taxes, fines and licences (at a time
when 45 per cent were using internet banking). By 2007 these figures started to shift; of the 67 per cent of
the population who used the Internet, 46 per cent had interacted with government electronically during the
previous year (Dutton and Helsper 2007) and in 2009, the same survey showed a sharper increase in e-
government usage: 59 per cent of users undertook at least one e-government activity online. Finally, the
frequency of on-line transactions, such as paying for government services, taxes, fines and licences, was
starting to catch up, having increased more dramatically than information seeking in the previous two
years.
However, although figures for e-government usage have increased, UK e-government still seems
to lag behind other countries and sectors and there remains a general lack of Internet-based innovation. In
2008, Eurostat found that 26 per cent of UK citizens had ‘interacted with public authorities online’ in the
last three months, compared with nearly 50 per cent in the Netherlands and 41 per cent in France. In
2009 the 59 per cent of users who had interacted with government on-line in the last year, only a third of
which was for other than information seeking compares with 81 per cent who had compared products and
prices, 80 per cent who had bought on-line, 76 per cent who had made travel reservations and 55 per cent
who had used on-line banking. The aggregate survey figures hide great pockets of offline administration.
In the Department of Work and Pensions, for example, only one percent of all customer contacts take
place on-line. In 2002-5 the Department went heavily into phone based processes, to replace paper forms
and face to face delivery, and it is not currently possible to claim benefits on-line. And in spite of the
enthusiastic Power of Information review, UK government has been slow to capitalise on the productive

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potential of on-line citizens noted above; a recent NAO report (Dunleavy et al, 2007) found almost no
instances of Web 2.0 applications being used by government.

Providing solutions: size matters

So how might UK government make the most of technology in the current climate and realise the
potential of the digital era? One important point to note here is that government does not, any longer,
develop its own technology. Government information technology was progressively outsourced from the
1980s onwards; by 1995 30 per cent of IT expenditure was spent on commercial services. By the 2000s,
every department and agency was involved in a large-scale relationship with at least one major computer
services provider (Margetts, 1999). So a key way to enhance government’s use of technology is to
examine its relationship with the computer services industry.
The market in the UK was shaped by the distinctive characteristics of public management reform
during the 1980s and 1990s, labelled ‘New Public Management’ (Hood, 1985, 1994; Barzelay, 2000; Pollit
et al, eds. 2007), in which contracting out played a central part. Centralised contracting out strategies in
the form of Market Testing and Compulsory Competitive Tendering were succeeded by the Private
Finance Initiative, a distinctive model of contract financing which led in the UK to a particularly radical form
of IT outsourcing (or ‘totalsourcing’) in which government agencies retained very little expertise internally.
Agencification, through the Next Steps programme, also played a role, as in some departments the
information technology divisions were made into executive agencies (such as the DVOIT in the
Department of Transport) and then tendered for contracts. PFI fuelled the existent trends for UK
government IT contracts to increase in size, and contributed to the distinctive shape of the UK contracting
market, meaning that large-scale long-term contracts will be a feature of UK government IT contracting for
decades to come.
Size is also a feature of the way the UK government has tended to develop new systems. In the earlier
days of information technology, the combination of a large population, huge central administrative
departments and mainframe computer systems, the technology of the time, the large scale of government
computer systems was somewhat inevitable. But the ‘big database’ mentality is something that has
persisted in UK government. Particularly ambitious (and expensive) plans include the £12 billion dedicated
to the NHS IT strategy to develop (among other things) electronic patient records and the Home Office’s
proposed identity card scheme including a national identity register (described proudly as a new ‘gold
standard’ of government databases to the author by one policy-maker), at an estimated cost of around £5
billion (Home Office 2008). The five largest systems maintained by the DWP include the Customer
Information System, described by DWP as ‘one of the largest databases in Europe’, which will eventually
hold 85 million records and transfers data from existing sources into a centralised database that is
available over secure channels to 80,000 members of DWP staff, 60,000 users from seven other
government departments and over 445 local authorities. Meanwhile a range of huge legacy systems use
software dating back to the ‘Operational Strategy’ systems developed in the 1980s (see Margetts, 1999),
storing basic customer information and details on payments and are used by Benefit Decision Centres to
decide on and register decisions on applications for Job Seekers’ Allowance. Most of DWP’s interactions
with citizens and most of their administrative decision-making rely on a complex mesh of inputs and
outputs to more than one of these systems, several of which are unable to interact with each other.

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 Basically then, the UK government contracting regime for IT is characterised by big databases and
huge contracts. The two characteristics have the tendency to reinforce each other; the dream of a big
database causes policy-makers to tender big contracts; big companies are inclined to promote the idea of
big databases. By the early 2000s the UK market was distinctively oligopolistic, with the top five
companies holding around 90 per cent of large government IT contracts in terms of contract value and one
company in particular, Electronic Data Systems, holding over 60 per cent of contract value up until 2004
(Dunleavy et al, 2006). Some UK government outsourcing deals, such as the £4.3 billion ten year contract
for the IT of Her Majesty’s Revenue and Customs won by Cap Gemini from EDS in 2005, are the largest in
the world (industry scepticism regarding such arrangements was evidenced by the drop in Cap Gemini’s
share price when the award was announced). Comparative research on government contract relationships
reveals the UK as an outlier among other industrialised nations in terms of contract size and found the
UK’s distinctive relationship with the IT industry a determining factor in its poor e-government performance
(Dunleavy et al, 2006).
A number of strategies for improving contract relationships emerge from comparative models, first with
respect to engineering competition and the involvement of small firms. In the US, a tighter regulatory
regime and legislation specifically geared at involving smaller firms and increasing competition in
contracting led to a less oligopolistic market than the UK, where the top five companies held only around
20 per cent of government business at the time when the UK market was so dominated by EDS. The
government encourages and develops the government IT market by keeping it vigorously competitive and
encouraging the emergence and development of small technology companies. Rules mandating small
business participation have fostered the development of small to mid-sized companies, some of which
deliberately restrict the scale of their operations so as to qualify for government consideration. Consortia
arrangements are also flexible and balanced, with small- or mid-sized firms sometimes operating as the
main contractors and IT majors or systems integrators acting as subcontractors to them. In Canada,
Denmark and the Netherlands – all with reputations for success in the e-government field – governments
outsource lower proportions of their information technology; indeed in Canada, representatives of
computer services providers described the federal government as their ‘greatest competitor’ (Dunleavy
and Margetts et al 2006). In-house capability means that where competitive bids cannot be found in the
private market – or if projects go wrong – they have the option of carrying out the work themselves.
There is evidence to suggest that smaller contracts can be the key to better contract relationships. The
Netherlands provides an example of the so-called ‘Rhineland’ model of contracting, where ‘seeking a good
relationship, based on consensus and talking and mutual support’ are prioritised, in contrast to the Anglo-
Saxon model of the UK, the US and Australia where financial control is more important (Dunleavy et al,
2006: ). In this model, client knowledge and experience is as important as professional expertise;
companies looking for contracts need to ‘work their way up from the shop floor’ and deal with small
contracts. So, while Cap Gemini (for example) in the UK goes for huge outsourcing deals, in the
Netherlands its deals are small. Agencies and government departments split contracts up into what are by
international standards very small packages of work. Each agency likes to develop and keep up relations
with a plurality of suppliers and a conscious effort is made to ensure that diversity does not reduce over

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time. Large projects are envisaged from the outset as multi-contractor and designed so that the agency
maintains options for tenderers.
Various improvements have taken place in the UK since the worst excesses of the 1990s. In the UK,
the Private Finance Initiative was abandoned for IT projects in 2004, with the Treasury admitting
‘difficulties with achieving appropriate risk transfer in IT PFI’ (HM Treasury 2003) and announcing a return
to ‘conventional procurement methods’. The Office of Government Commerce (OGC) in the Treasury
examines programmes and projects at key decision points in their lifecycle through compulsory ‘Gateway
Reviews’, providing guidance on best practice in procurement. The recession has already had one
beneficial effect, by causing the Labour government to abandon its plans for the national identity register.
But the ‘big project’ mentality persists. Some strategically important initiatives (such as the www.direct.gov
supersite) are deemed too small to require Gateway review, yet have important implications for the future
of UK e-government and have been categorised as high risk by the National Audit Office (NAO, 2007).
There is major scope for using comparative lessons to develop much smaller public-private partnerships in
developing innovative web-based initiatives. There is also scope for contracting with other types of
organization, such as social enterprises. The involvement in the provision of democratic information of the
social enterprise My Society, which developed the No. 10 Downing Street online petitions site and various
other innovations such as www.writetothem.org is an excellent small scale (and cheap) example. The
Conservative party have recently proposed moving to systems of procuring major IT projects that are more
modular and operate within relatively restrictive ceilings (no contract more than £100 million, for instance)
and other commentators have noted that widespread opportunities exist for public agencies to extract
better value by moving from tailor-made or 'a la carte' systems to more modular and standardized
systems.

Saving money: making electronic interaction the norm

Web-based interaction provides enormous potential to save money, over and above the gains
made from ‘digitalization’ in the early days of government IT systems, by moving citizens from expensive
face-to-face, paper or telephone channels towards electronic interaction. Many private firms have taken
specific moves to make these gains and of course many private firms deal only with customers on-line, but
the UK government has been rather slower, as noted above, to make available and drive up usage of
electronic channels. It is inevitable that, in general, citizens find shopping or listening to music online more
entertaining than interacting with government, so increasing electronic interaction needs appropriate
incentivization strategies (see Margetts and Yared, 2003).
One example shows how a cold climate may actually promote innovation. The recession, through
an almost doubling of unemployment, proved the current arrangements for delivery of Job Seekers
Allowance (described above) non-viable and provided a push for the Department of Work and Pensions to
leapfrog plans to make it possible to make most of the claim for the benefit on-line, expecting to reach 40
per cent take-up by 2011. On average a JSA application costs £89 to administer (NAO, 2009: 18) and in
the six months to January 2009, the number of new claims grew by 81 per cent to 105,450 per week. The
cost savings from an on-line application could be estimated at about half of the total, or about £45, by
removing phone call costs, and information gathering costs. So the annual cost savings from this

6
application alone could be expected to be around £100 million. A current extremely limited application
shows some pent up demand; even though it is difficult to find and use, take-up more than doubled during
2008. The new application will be developed by a smaller company outside the Department’s normal
contracting arrangements, illustrating the increased agility afforded through smaller and more piecemeal
contract arrangements. The move follows that of the US, where SSA pension applications online was
introduced in January 2009 as they faced 10,000 new applications per working day for 20 years, replacing
a 45 minute face to face interview with an online application that takes around 15-20 minutes to complete.
Other cost savings can come from moving interaction on-line and, where possible, closing off-line
channels. A dual channel approach was much vaunted in the early days of e-government on grounds of
equity, but it is extremely expensive. But the move towards electronic interaction can only take place with
a strategy of segmentation; identifying groups in terms of the extent to which they are digitally enabled,
and treating them differently according to their wants and needs. Some groups – such as students – have
virtually universal internet penetration. So it makes sense to mandate electronic interaction for them,
without fears of exclusion, as was done for student loan administration in the early 2000s. For other
groups, such as the elderly or the disabled, mandation is not an option. A different strategy must be
applied to these groups. But some of the savings made from those interactions that do take place on-line
can be diverted towards more personalised electronically-mediated interaction, for example, through
benefits personnel visiting applicants for Attendance Allowance on-line and filling in electronic forms for
them on the spot.
Effective segmentation, accompanied by a strategy of ‘nudging’ people towards electronic interaction
and where possible mandating electronic interaction can reap rich benefits. A variety of possible strategies
include financial incentivization, adjusting the time frame for on-line interaction (such as providing benefits
more quickly, or collecting taxes more slowly) or providing citizens with functionally specific training and
support to interact with government on-line (especially when applications are first introduced), analogous
to the way that British Airways provided additional staff at airports to help passengers use new on-line
check-in facilities. In some instances these ‘nudging’ strategies can be combined with mandation. HMRC,
for example, has used such a strategy by mandating electronic submissions for late filers and increased
electronic filing of UK’s self-assessment tax forms from 44 per cent to 58 per cent in 2008-9. There are
numerous examples from other countries, notably Chile who by mandating electronic filing of taxes
accompanied by the creation of a network of Internet tax cafes, where citizens could get assistance both in
the completion of the form and the electronic submission, achieved more or less universal electronic filing
in the early 2000s at a time when the figure for HMRC was below 10 per cent.
Of course, some people are always going to be digitally excluded and steps must be taken to ensure
that they do not become excluded from key service provision. There is a danger that as electronic
provision becomes the norm, some offline services will decline or even be phased out altogether, in which
case residualization could result. One key way around this problem is through the use of intermediaries.
Research suggests that the group of people who have no access to the internet at all may be smaller than
usually assumed. When non-users were asked in the Oxford Internet Survey whether, if they needed to
‘use the Internet to send an email or something now’, they could get someone to do it for them, 73 per cent
replied that they ‘definitely’ or ‘probably’ could. Such figures suggest that of the 30 per cent of the

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population that do not use the Internet, less than one third (8 per cent) are firmly digitally excluded, without
even indirect access. Quite different strategies are required for these different groups of non-users. For the
former, developing formal and informal channels for intermediaries is key, while for the latter a more
personalised approach (possibly through social enterprise organizations such as the Citizens Advice
Bureaux) is clearly going to be essential.
Identifying cost savings from future e-government initiatives is notoriously difficult due to the lack of
information available on the costs of existing administrative processes; UK civil servants are reluctant to
estimate such figures. But there is evidence to suggest that a strategy of segmentation combined with
moves to increase internet penetration and tackle problems of digital exclusion in key groups (see Helsper
and Dutton, 2009) could bring large savings to public services, which can be hinted at with existing data.
For example, there might be a concerted move to increase internet access among the elderly (currently a
group with lower levels of internet penetration), providing them with the search skills to obtain on-line
health information and obviating the need for some visits to local doctors. The NHS Information Centre
estimated that in 2007, there were 6,050,837 GP consultations with those over 65 and according to the
BMA, a GP visit costs £20-25 to the NHS (although this may be as much as £36 according to Curtis,
2008). If these could be reduced by 10 per cent, or by 600,000 visits, then such a move could result in cost
savings of between £12 and £15 million. Another example comes from the role played by Job Centre Plus
in helping the unemployed to find work; JCP spends £235 million per year on 9,300 personal advisers that
meet in person with customers to help them find a new job or find a better job, 3,400 of which are
dedicated to new start programmes or new deal programmes for people age 22 and older, a total cost of
£86 million (PAC, 2007). By reaching out to economically disadvantaged people online rather than through
personal advisers, JCP might save around 20 per cent of the resources currently being spent on these
advisers, or £18 million.

Innovating out of recession: Digital-era Governance 2.0

Whatever the ebbs and flows of government policy in this area, there is a case for moving digital
technologies back to centre stage of public service reform, encouraging public servants to innovate with
technology and bringing citizens into the ‘front office’. By 2004, some commentators were beginning to
suggest that digital technologies were so crucial to governmental operations and policy-making that
‘Digital-era Governance’ (DEG) could be regarded as a new ‘paradigm’ for public administration (Dunleavy
and Margetts et al 2005, 2006), replacing the former dominance of the so-called ‘New Public Management’
(NPM) as a model for public management reform. Digital-era Governance includes a range of information
technology-centered changes. First, and in part a reaction to NPM-induced fragmentation, re-integration
of governmental processes and organisations involves the development of shared services and ‘joining up’
and partnership working across organizational boundaries. The recent establishment of the new Tribunals
Service provides a significant opportunity for such re-integration in the administrative justice sphere,
bringing together, as it does, a range of disparate appeal systems. Second, needs-based holism includes
refocusing organizational structures and processes around clients, end-to-end redesign of processes and
‘one-stop’ processes that allow citizens to initiate or complete several dealings with government with one
interaction. The successful project to electronically enable road tax renewal, which checks in one

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interaction applicants’ insurance and MOT status from a range of public and private sector databases, is
an excellent example of the kind of complete process redesign that needs-based holism requires, as is the
Oyster Card ticketing system in London. Third, increasingly radical digitalization changes include new
forms of automation that can lead to disintermediation or ‘zero-touch’ services, where no public service
official need touch a transaction and new forms of ‘open-book’ governance where digital applications allow
the revealing of government decision-making and processes and increasing transparency in government.
There are various moves towards ‘zero-touch’ in transport, such as the payment of (and penalizing for
non-payment) of the London Congestion Charge.
So, there are a number of specific ways in which the UK government is already moving towards
Digital-era Governance. To make the most use of technology in a cold climate however, there is great
scope for a more concerted move towards DEG, particularly through the use of newer Web 2.0
applications which allow government to do new things that it didn’t before, generating content from users
and allowing citizens to ‘co-produce’ or even ‘co-create’ public services. The potential is huge for people
to do things with government that they (already) do with other organizations and each other. Web 2.0
applications which play back information about what other users are doing, such as recommender
systems, or what they think about services, such as feedback sites, generate a lot of information that
government has not previously had access to. The key is ensuring that government is receptive to this
information. So far, as noted above, there is evidence to suggest that in spite of the phenomenal success
of such applications in other areas of life and the identification of their potential benefits for government
through (for example) the Power of Information review, governments have in general been reluctant to
embrace them in practice.
Why? There are a number of barriers which will have to be overcome; government in general but
British government in particular has some distinctly ‘1.0’ vibes. In particular, the informal aspect of these
technologies is often viewed with suspicion by government organizations (‘government doesn’t do cool’ is
the predominant view) and often the largest and most established of their contract partners, which do not
necessarily have a reputation for web-based innovation. In the early days of the Web, many officials were
unable to access the Internet at work, meaning that they could only see their departmental web site at
home (see NAO, 2002) and were very unlikely to build web-based innovation into their daily activities.
These restrictions are often applied to newer technologies; in the US, for example, officials in various
departments and agencies are barred from using social media sites at work. Government officials are also
concerned by the part-authenticated nature of Web 2.0 information, particularly citizen feedback and rating
information. In fact, early findings from the social enterprise site www.patientopinion.org, which allows
health service users to rate and comment upon the care they received in hospital, suggest a more or less
equal balance between negative and positive feedback. But although the NHS have now embraced this
facility in the heavily resourced NHS choices site, the feedback section is buried increasingly deep in the
site and is very difficult to find – DEG ‘2.0’ would suggest it should be prominently advertised on the front
page. Likewise, the UK government has resolutely resisted moves to introduce such rating systems into
education.
There is scope then to take moves towards DEG much further. Playing back to citizens what they have
done and what other citizens do, through reputation and recommender systems, means that citizens are in

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effect co-producing public services, even if they are not always conscious that they are doing so.
Electronic banking means that customers undertake quite a few of the activities that their bank used to
administrate – saving the bank considerable resources, as well as the obvious one of being able to close
high street outlets – and government can get these benefits too. But such savings are reliant on the idea
that citizens have an ‘account’ with government departments as they do with the bank, allowing them to
view online all the interactions that they have had with that department – something not currently available
for any UK government department. There is scope for blurring the boundaries of public services, using
social networking applications to incorporate valuable information held by citizens that can be valuable to
public personnel. In Sweden, local social care networks include the friends and family of vulnerable
individuals as well as healthcare professionals, who are able to provide information as to the individual’s
current state of health via an online network that can be shared with more remote stakeholders.
The next step would be co-creation of services, in what von Hippel (2005) called Democratizing
Innovation. The US federal government’s eRulemaking initiative, whereby the public and experts may
comment electronically on legislative initiatives is a step in this direction, although various commentators
have stressed the need for the development of software to filter and synthesize public input, particularly
mass campaigns from advocacy groups (Shulman, 2009). Designing initiatives like this in UK government,
if able to overcome such technical problems, could do much to incorporate valuable expertise into policy-
making and the design of public services in specific areas. For example, patient groups for chronic
illnesses such as diabetes and multiple sclerosis often have untapped expertise and knowledge about their
specific illness (see Ragnekar and Duckenfield, 2002) and an extremely active on-line presence on web
sites and in social networks, which could be funnelled into the design of health services for people with this
condition. Other examples of co-creation include the metropolitan government of Seoul in Korea, where
citizens are able to suggest via a web site innovations that they would like to see in public services; a prize
is awarded for the innovations that are adopted. Such a deliberate move towards citizen innovation starts
to look like the Digital-era Governance of the future.

Conclusion and Recommendations

In summary then, this short paper has summarised the UK government’s use of digital technology in public
service delivery and has made some suggestions how moves to Digital Era Governance might be
accelerated, leading to innovation, cost savings and ultimately, better government and a warmer climate.
Specific recommendations for both government and technology companies are as follows.

Smaller contracts, distributed databases

Government should work to ensure that contracts are of manageable size and scope with a ceiling on
contract value, retaining the expertise to manage them and moving away from the ‘big database’ mentality
towards an information architecture more like the largest supermarkets, where appropriate information is
centralized but fulfilment is localized.
Technology companies need to respond to this move by ‘sweating the small stuff’ – working towards and
aiming at far smaller contracts than they have in the past (likely to be positively aided by the recession).

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Making electronic interaction the norm
Government departments need to segment their customers and then nudge and then mandate – or
intermediate, according to segment – electronic interaction.

Digital –era Governance 2.0: citizens co-producing and co-creating government services
Government departments should give all civil servants access to Web 2.0 tools and encourage them to
innovate, ultimately offering incentives for citizens to suggest innovations and enter the front office.
Technology companies: Companies providing technology to government need to partner with small tech
start ups, social enterprises and intermediaries, to ensure that they retain the agility to innovate.

References

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