Government needs to move on a national e-payments strategy

Coalition's plans to justify benchmarking are light on targets and commitments, writes Enda Kenny.

Coalition's plans to justify benchmarking are light on targets and commitments, writes Enda Kenny.

A fortnight ago the Government published the Action Plans of 27 Government Departments and Offices which will be used to justify the final two payments of the benchmarking awards.

Fine Gael has already expressed the view that the plans are very light on specific targets and commitments which will have a real and tangible benefit for consumers of public services. The Action Plan produced by the Taoiseach's Department is a prime example of a missed opportunity to show leadership and a strong commitment to positive change.

For nearly three months now the Taoiseach has had a report on "e-government leadership" on his desk which, if implemented, could generate savings of up to €420 million per annum. That would pay for 2,000 extra gardaí and double the primary school building programme

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The report comes from the highly regarded Accenture consultants and recommends the rapid implementation of a national e-payments strategy. This would see cash transactions gradually replaced by electronic money transfers, in many cases using a smart card. The report also makes it clear that with much of the necessary investment and infrastructure already in place, the key missing ingredient is strong and effective Government leadership.

It is astonishing, therefore, to see that the implementation of this report does not feature in the Action Plan of the Department of the Taoiseach. The plan does refer to the Department having a monitoring role, but there is no mention of leadership or driving a strategy which would deliver a national electronic payments strategy and save millions of euro.

The transition to e-payments within Government Departments and agencies should be pursued aggressively as a policy objective. To date the Government has made slow progress in advancing e-payments and smart-card technology. Many e-government projects are behind schedule with deadlines being ever-prolonged.

According to the Government's own progress report, New Connections (Feb 2003), 57 e-government projects are currently delayed.

A national e-payment strategy would help would position Ireland as among the "best practice" countries in Europe for e-payments and would contribute to an improvement in overall national competitiveness and significantly improve access to banking products and services for the traditionally under-served segments of the Irish population.

The "best practice" countries in electronic payment sophistication are also those with highly competitive economies.

In this regard Finland leads the way. Paper payments are less than 10 per cent of electronic payment volumes in Finland, and cash circulation as percentage of GDP is one of the lowest globally. In contrast, Ireland has one of the highest levels of cheque payments and cash usage in the EU.

The Government has failed to show leadership in promoting e-payments. Some of our largest local government authorities operate with only 15-25 per cent electronic penetration, with Government suppliers paid 90 per cent of the time by cheque.

Little wonder then that Finland's Networked Readiness ranking in 2002, i.e. the state of its National Information and Communications Technology Environment was ranked No 1, with Ireland well down the table at No 21.

While the Government does have plans to introduce smart-card technology here, its progress to date is further proof of its lack of joined-up thinking.

The smart cards for transport (i.e. integrated ticketing) are predicted to go live in February 2006, having been originally promised from the end of 2002. Up to 50 per cent of smart-card users for public transport are expected to be social welfare benefit concessionaires, which will require integration of the mass transit card scheme with social benefit systems.

But the Government's smart-card scheme is being developed to run independent of a smart-card scheme that is being introduced by the banks between now and 2005. Experience in other countries has shown that the success of smart cards is directly related to the ability to use them for multiple purposes. A clear case exists for the Government to have a unified smart-card approach, merging the strategic objectives of e-payments and mass transit.

However, based on past performance, don't hold your breath waiting for this Government to come up with a co-ordinated approach.

Another consultants' report, published by the PA Group last year, on the implementation of the Strategic Management Initiative, found that "progress on cross-cutting [i.e. involving two or more Departments] issues had been disappointing, with the system still struggling to find practical collaborative mechanisms to progress the management of these issues".

If the Government is serious about driving the Irish economy towards a knowledge-based economy and Ireland as a leader of e-Europe, then it is time it stopped sitting on the fence and showed leadership in advancing e-payments.

The Accenture report provided the Government with a golden opportunity to bring about real change, value for money and more efficient public services. That is what the benchmarking process should be all about.

Enda Kenny TD is leader of Fine Gael.