The right governance platform

Platform governance can usher in an era of decentralized and personalized government services

In its Gandhian conception, the decentralization of political and economic power is fundamental to a democracy based on individual freedoms and initiatives. Gandhi’s vision of such decentralization has also seen individuals actively participate in government. Nearly seven decades later, digital technologies may be able to realize this vision of a decentralized government that allows for individual participation and engagement. Genuine decentralization of government means moving from a fragmented and complex system protected by legacy custodians and processes to transparent, responsive, flexible and user-friendly platforms.

The last 150 years have seen populations and economic complexity multiply. In a country like India, for example, each district can have local industries and supply chains that go beyond the economic complexity of entire nations before the industrial revolution. Given the heterogeneity, it quickly becomes clear to an administrator that policies need to be shaped according to the contours and peculiarities of smaller and smaller administrative regions – eventually, personalized governance is required.

Inevitably, the confluence of decentralization and personalization will lead to conflict: to develop policies tailored to the situation, the government will have to be given more power to decide separately on the merits of each decision – it sometimes creates a situation where people start looking for ways to “influence” decision-makers to achieve their goals, and all of this ultimately creates a culture of jumping in the queue. How can we deliver a government that is both personalized and fair? In the past, the provision of personalized services also meant giving more power to bureaucratic processes, and the consequent and inevitable erosion of fair and impartial decision-making over time. Solving this dilemma requires a new paradigm of governance that replaces a monolithic, regulated and centralized hierarchy with competitive, citizen-centered and decentralized platforms.

We use platforms every day to shop, call taxis, book tickets, make payments and get and share information. By 2023, it is estimated that nearly two-thirds of Indians will have both a mobile device and Internet access. Applying for a government license online is likely to be easier and less expensive than going to a physical office to meet with an agent and fill out multiple forms. This growing digital population is an opportunity to revolutionize existing government processes. The platform approach has already been used successfully in India. For example, according to the Aadhaar State Report (2019), 95% of Indians currently have Aadhaar and use it on average once a month. NPCI’s UPI has sparked a revolution in India’s digital payments ecosystem by providing a single platform for customers to access seamless routing, payments and banking services. UPI’s success is due to its structure as a highly scalable platform bringing together different sets of users or stakeholders (customers, banks and merchants). The Prime Minister’s call for all government procurement to be on the government’s electronic market (GeM) led to Rs 1.16,000 gross cumulative transaction value as of March 31, 2021.

Basically, digital platforms create and provide open participatory infrastructure to enable different groups of users or stakeholders (such as buyers and sellers on Amazon or GeM) to interact with each other in different contexts. Unified platforms allow for strong interactions between these stakeholders that generate value for each other. Platforms also benefit from positive network effects, i.e. the additional value generated by robust interactions between different users and the freedom to innovate. In GeM, for example, the main users are government organizations of buyers and sellers/service providers.

With an open, easy-to-use and accessible platform, GeM has transformed the way public procurement is conducted by enabling a competitive and transparent marketplace that delivers more and more value as it evolves. Government buyers benefit from a diverse ecosystem of sellers competing to provide better, more cost-effective goods and services. Sellers benefit from the ease of doing business with the government (e.g. by encouraging timely payments and more opportunities) on the platform.

Taxpayers benefit from rules-based, transparent and streamlined procurement that improves transparency and has a positive impact on the economy and governance. Platforms replace ad hoc decision-making, on a case-by-case basis, with consistent system-wide, policy-based decision-making. For example, GeM has replaced traditional bidding practices with transparent and automatic bidding: a government buyer can always set standards for what he wants to buy and its features, specifications, terms and conditions, but cannot select the seller based on foreign considerations.

With digital technologies and ever-increasing connectivity, platforms are evolving much more efficiently than traditional linear forms of government. This can put more power, access and autonomy in the hands of citizens. For example, 49% of people registered on Aadhaar used the platform to access services for the very first time (e.g. ration, MGNREGA, social pensions, SIM cards and/or bank accounts). Platforms eliminate traditional information asymmetries and streamline bureaucratic processes and functions. Think of the transparency and efficiency induced by economies of scale, the uniform and consistent rules-based system of the Goods and Services Tax Network (GSTN) for taxpayers and central and state governments. The eNAM platform is a pan-Indian e-commerce portal that networks different APMC-mandis to create a unified national market for agricultural products, allowing farmers to benefit from real-time market signals in the marketing and sale of their products. Platforms eliminate custodians (such as intermediaries in transferring government benefits, as in streamlining DBT via Aadhaar).

Advances in cloud computing and technology are continuously improving platforms through feedback loops based on user-generated data on the platform. At GeM, we test the use of advanced artificial intelligence and machine learning to identify deviant behaviors on the platform and introduce incentives to induce behavior change for buyers and sellers in an open and transparent market. Platform power can be further enhanced with technologies such as AI to deliver efficiency gains and customization, as well as blockchain to allow entities to self-regulate. The GeM platform recently conducted a pilot leading to the transparency of the transport conditions of pharmaceuticals. Similarly, advanced analytics and artificial intelligence are widely used on the platform to inform research and report suspicious transactions.

To harness the power of platforms in government, we must first develop a strong framework of consent and confidentiality to allay citizens’ concerns about how their data will be handled. Secondly, a SPV should be created to incubate platforms in consultation with start-ups and the innovation ecosystem. This SPV must be managed by a professional team and although it can benefit from initial funding, it must have a path to self-sufficiency. Third, a review of the entire government process is needed to understand which interfaces can be “platforms.” Legacy processes that cause friction and lower the bar for citizens’ experience can be immediately discarded.

Fourth, all states can and must be integrated through participatory and innovative governance mechanisms such as the GST Council and be empowered to develop a change with this paradigm. Fifth, the growth of private and public-private platforms must be encouraged and there must be a roadmap for interoperability between different platforms and secure access to data between platforms. Sixth, a coherent and unified strategy of e-governance and platform adoption in all departments through a whole-of-government approach can be conceptualized in consultation with central and state government organizations.

There is no doubt that India is poised for a digital transformation, with the government leveraging platforms to collect taxes, distribute benefits, provide services and build infrastructure. However, we must remain thoughtful while reinventing government functions as platforms. Strengthening digital security and adopting strong legal frameworks and global best practices is essential to developing effective, efficient and sustainable platforms that benefit citizens.

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