GCC Social Security Conference - Ryiadh April 10th 2014

1. 1 | © 2012 Oracle Corporation – Proprietary ICT-enablement of Social Security: how digital innovation impact and transform agencies Trends in delivering social insurance via electronic channels GCC conference, Riyadh April 10th, 2014 Christian Wernberg-Tougaard, Director, Social Welfare, EMEA

2. 2 | © 2012 Oracle Corporation – Proprietary The following is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decision. The development, release, and timing of any features or functionality described for Oracle’s products remains at the sole discretion of Oracle. Safe Harbor Statement

3. 3 | © 2012 Oracle Corporation – Proprietary About me ... • Head of Social Welfare Practice, Oracle Industry Bus. Public Sector, EMEA • Nordic Public Sector Industry Lead • Global Lead on Error, Fraud and Corruption (EFC) • Macro economist (specialized in Developing Economics and Labour Economics) • Worked with the impact of ICT on Public Sector for the last 17 years, including being: – Senior expert for the Danish Government / Parliament on technology issues – Member of Board of Technologies eVoting comittee. – Expert for the European Commission (eInclusion Policy Support Program, Safer Internet for Children) and the European Parliament (RFID and Identity Management STOA). – Different director roles in EMEA for IT-industry companies working with Business Development, Strategic Marketing, Innovation & Transformation. Worked as a Management consultant – Head of Sector Danish Ministry of Science • Frm. Chairman of The Danish Board for Greater IT-security • Frm. Member of ENISA’s Permanent Stakeholder Group Christian Wernberg-Tougaard LinkedIn: www.linkedin.com/in/christianwernbergtougaard Twitter: @digitizeSociety Blog: http://digitizesociety.blogspot.dk/ christian@wernberg.org

5. 5 | © 2012 Oracle Corporation – Proprietary Trends impacting Public Sector / Social Welfare The Digital Service Society (#TDSS) The Data & Innovation Driven Society (#TDIDS) The CIIP Demanding Society (#TCIIPDS) The Automated, Robot Aided Society (#TARAS) We are creating Next-Generation of Digital Society in EU.

7. 7 | © 2012 Oracle Corporation – Proprietary Mobility • Everybody wants mobility and access to everything. • It is accumulative – so more and more requirements. • 5.7 billion mobile subscriptions by end of 2010 – including 940 million 3G connected. • Mobile access is possible for 90% of worlds population. • Internet access (in per cent of population): – Nordics: 95-98% – Europe: 60% – Africa: 9.2%

9. 9 | © 2012 Oracle Corporation – Proprietary ICT Innovation • ICT innovation takes many forms: – User Interfaces and ease of use. – Interconnectivity across different platforms (ex. Netflix) – Hardware optimization and specialization – Product specialization – functional and industry-specific – etc etc etc • The complexity of the choices of which ICT innovations to include, is overwhelming for Governments and Agencies. • So how to choose the “right” innovations at the right time?

10. 10 | © 2012 Oracle Corporation – Proprietary Prerequisites for innovation to be utilized • The World Bank: Impact of new technology (5% market penetration). – 28 innovations in developed world -> 23 got penetration over 50%. – 67 innovations in developing world –> 6 got penetration over 50%. • Conclusion: – Technology innovation in developed world have higher acceptance rate and faster uptake. – This can be explained by the fact that core infrastructure in developed countries exists and are available for most citizens / companies.

11. 11 | © 2012 Oracle Corporation – Proprietary Prerequisites for innovation to be utilized (II) • So Governments should initially care about enabling core infrastructure services – rather than deploy advanced eServices to citizens. What is the point of a good service than no-one can access or authenticate? •Governments needs to know who are who and what is what. Who are you, where do you live, what is your job, how many kids do you have, what is your school record, what is your health record etc. All of this is meta-data that can be connected to the MASTER DATA (or core registration data), the data that describes individuals, companies, property etc. Master Data: •In order to secure the rightfulness of users, citizens and companies to the services, one needs to validate identity. A unified PKI-infrastructure as a back- bone service could establish this. •Identity Management – and Roles & Responsibilities as well as Segregation of Duties are important items to consider on the ”inside” of Public Sector to prevent Collusion. Authentication: •Access to internet is a key requirement in order to offer services or demand digital service usage. As companies often have better options to be “mandated” to use digital services, G2B is the obvious choice to start with. And that might provide a better competitive marked for broad-band connectivity. Communication:

12. 12 | © 2012 Oracle Corporation – Proprietary Focus on Three Key Innovation Areas ICT Consolidation Efficiency and Effectiveness Skills and Labor A complex set of influences drives focus on transformation These 3 key areas are investigated further in the PDF version of this deck, as well as on my blog - http://digitizesociety.blogspot.de/

13. 13 | © 2012 Oracle Corporation – Proprietary ICT Consolidation • Governments need to be: – Aware of the costs that can be saved on ICT consolidation. • Datacenter consolidation and Centralized Licenses Agreements for whole Government / Public Sector is a low-hanging fruit. – Examining Cloud/Virtualization and Shared Service as future operation model • Governments are investigation how local and “Safe Harbor” cloud services can meet their privacy protection requirements. – Collaborating around information and data sharing • Programs (like Schengen, Europol, EESSI, HccH’s iSupport System) will be more globally focused – cloud would save costs, improve deployment and reduce risks on implementation/maintenance.

14. 14 | © 2012 Oracle Corporation – Proprietary Efficiency and Effectiveness • Governments need to be: – Ready to utilize technology innovations • Innovations in ICT has slow adoption in PS. Eradicate the “Not-Invented-Here Syndrome”. – Ensure cross-Agency collaboration • Collaboration and data sharing across agencies is good for saving costs and for citizens – Streamlined processes • Digitalization ready laws are together with STP (Straight Through Processing) key words for Public Sector Transformation. From “save millions” to “save billions”

15. 15 | © 2012 Oracle Corporation – Proprietary Citizens and Employees • Governments need to be: – Aware of the Citizen’s Experience • The citizen expects a comfortable journey – through health systems, through citizens services, through the legal system. – Ready for the demographic changes • Governments face a triple challenge: – Young people growing reluctance to join Public Sector, – Most senior employees will retire and – The aging population will increase the wage-gap between Public and Private Sector. – Willing to develop new service models • This will change the operational set up of ICT. Consider data centers, cloud and XaaS

17. 17 | © 2012 Oracle Corporation – Proprietary Digitalization of the Social Protection Staircase* Maturity and Effectiveness! What about Fragmentation? Minimum Income / Social Protection Floor (ILO) Additional Rights Contributory Increasingschemecomplexity Increasing Effectiveness & Maturity of Digitalization of Social Welfare / Social Security (*) Based on Fabio Durán-Valverde (ILO) presentation at 13th ISSA ICT conference, Brasilia, 2012 and own adds. Social Insurance Funded Own payments to extra pension, extra healthcare etc. Universal Law Granted Rights The Nordics Nigeria: Mandatory contributions from Employers for Social Insurance (NSITF) Netherlands: Complex Digitalization of Social Security (UWV) and Old- age Pension (SVB) Sweden: Automated more than 12.000 rules for a single benefit using OPA -> achieved 99.98% automation; and high convinience for citizens. Increasing: • Rule Complexity • Master Data • System • Privacy • Stakeholders • TCO (Cost)?

18. 18 | © 2012 Oracle Corporation – Proprietary Complex Rules Objective vs Subjective Digital Illiteracy Payments Digitally Characteristics of MIS-schemes: an ICT view! National Differences Rules/Policies •These variates between MS – not the processes. •Hence a uniform system with individual rules, handle the complexities of peoples’ changes of circumstances. ICT •Especially among the target group its difficult to understand the rules •Right people gets the right (financial) support they are eligible for at the right time. Digital Inclusion Citizens •Especially among the target group its difficult to understand the rules •In Canada its estimated that 80% of Social Welfare recipients are digital illiterates ICT •Enabling Assistance Centers •Provide Screening/Application via Smart Phone Apps. •Empowered PVP (Public Volunteer Partnership) • Social Media Awareness Rai. Automation / STP Schemes subjective • Subjectivity makes it difficult to ”compute” • Transparancy and efficiency provided by objective rules – OGP. ICT •Adress ”Digital ready Law- making” (end-to-end). • Subjective rules can be transformed to objective. Digital Payments Gov. Pay. oldfashion • Kenya more advanced than EU average (Mpesa). •The poor / homeless are often not allowed banking ICT •Ecosystem that enables poor to access/spend MIS •Ensure functionality alternativ/digital payment (barcode for food),

19. 19 | © 2012 Oracle Corporation – Proprietary Complex Rules Objective vs Subjective Digital Illiteracy Payments Digitally Characteristics of MIS-schemes: an ICT view! National Differences Rules/Policies •These variates between MS – not the processes. •Hence a uniform system with individual rules. ICT •Especially among the target group its difficult to understand the rules Digital Inclusion Citizens •Especially among the target group its difficult to understand the rules •In Canada its estimated that 80% of Social Welfare recipients are digital illiterates ICT •Enabling Assistance Centers •Provide Screening/Application via Smart Phone Apps. •Empowered PVP (Public Volunteer Partnership) • Social Media Awareness Rai. Automation / STP Schemes subjective • Subjectivity makes it difficult to ”compute” • Transparancy and efficiency provided by objective rules – OGP. ICT •Adress ”Digital ready Law- making” (end-to-end). • Subjective rules can be transformed to objective. Digital Payments Gov. Pay. oldfashion • Kenya more advanced than EU average (Mpesa). •The poor / homeless are often not allowed banking ICT •Ecosystem that enables poor to access/spend MIS •Ensure functionality alternativ/digital payment (barcode for food), •In Sweden eligibility to the Dental Benefit is contingent on evaluation of more than 12.000 lines of policy/rules. Automated this takes 1-2 seconds (com- pared to up to 4 weeks) and 99.98% is automated. •In Denmark around 25% of population is functional illiterates – why self-service is difficult. • New instruments – like video- self-service kiosks – helps empower the poor/homeless. •New Zealand (Te Tari Taake) is leading on using ICT to enable holistic connectivity between ”Idea->Law->ICT enablement”. • A requirement to enable STP is good master data management – eg. UWV in Netherlands. •Ireland – DSP – is currently evaluating how to operate a sophisticated ePayment system. •Denmark is enabling homeless with ”payment” through NemKonto or ”Citizens service” – latter might be stigmatizing.

20. 20 | © 2012 Oracle Corporation – Proprietary Challenge – digitalization of subjectivity (human interaction). • A 100% subjective evaluation of ”fit” with rules and policies gives risk for citizens to be treated unequal -> rule of law issue. Denmark has a principle of not allowing ”evaluation/judgement” to be put under ”rule”. • To support caseworkers doing ”human evaluation” requires strong knowledge sharing (what did others do in similar cases) and exact information on the individual (Best in Class Master Data). • Automation can be achieved by incorporating digitalization thinking when drafting the legislation / policy in order to ensure ”non-interpretation” rules and master data consistancy.

22. 22 | © 2012 Oracle Corporation – Proprietary Recommendations #1: How to eat an Elephant without a “Silver Knife”? #2: Build a Business Case. #3: You are NOT unique #4: 80/20 Rule still apply #5: Carefully consider technology Innovations as an option. #6: Technologies exists (Don’t have to be invented) and mature

23. 23 | © 2012 Oracle Corporation – Proprietary #1: The “right” path steered by maturity and existing investments It’s complicated • to eat an Elephant. Where to start? Respectful of existing investments. • Easier when you start from scratch / green field. No Silver Bullet (or Knife?) • on how to eat an Elephant – but there is best practice and experience from others. Insight • Would be happy to share roadmap experiences through an INSIGHT.

24. 24 | © 2012 Oracle Corporation – Proprietary #2: Build a business case ICT Transformation •Ought to have good business case and that ROI are a matter of weeks rather than years. Investment €/$/£ budgets are tight, •so need to justify investments & buying, implementing and running Social Insurance not free! Holistic Business Case •also quantify the areas with most potential – need to balance investments with results. “as-is” and “to-be” •Is evaluations, so that KPI’s of transformation can be followed and documented. A guideline moving forward

25. 25 | © 2012 Oracle Corporation – Proprietary #3: You are NOT unique. NOT Unique • Remember: Public Sector Agencies are NOT unique from a PROCESS point of view. Separate PROCESSES and POLICIES • Separate “What you do?” and “How/Why you do it?”. • PROCESSES are very similar globally, what differs are the POLICIES / RULES. STP • Separating PROCESSES from POLICIES also a must when addressing high-performance / efficiency and how to enable STP – Straight Through Processing. Use COTS • Hence almost all requirements can be dealt with using Commercial-of-the-shelf Software and Hardware (so- called COTS).

26. 26 | © 2012 Oracle Corporation – Proprietary #4: 20% Technology, 80% Organizations Implementing change is always a challenge. •Enforcing collection and benefit control requires the organization to change, the citizen to change and the ICT to change. But the 80/20 rule do apply. •2 streams – one on change of people, one on change of ICT. •Ensure that the cultural change is clearly understood by citizens, companies and employees – through awareness raising and ambassadors. Collaborative cross-involvement •Ensure that all stakeholders – you (agency), SI and vendor talks together. •Recommend inaugurating ”Innovation Advisory Boards” where all parties meet every 2nd months.

27. 27 | © 2012 Oracle Corporation – Proprietary #5: Carefully consider new options New technologies •The Industry is constantly finding new ways and approaches to innovate the ICT ecosystem day-by-day. Don’t wait •You should NOT wait for “tomorrows” technology – harvest now, plant the seeds now. Impact assessments •Governments need to do an impact assessments on technology: •Privacy Protection •Big Data •Social Media •Cloud Deployment

29. 29 | © 2012 Oracle Corporation – Proprietary Utilizing a step-wise approach is wise. Step 1 •Get data electronically – go from paper to digital Step 2 •Strengthen the master data and meta-data operation. Step 3 •Establish a national unified secure log-in – trusted PKI Step 4 •Establish other key core infrastructures – unified “Payment Engine”, citizens “public” clearing bank account, citizens DocBox. Step 5 •Enable automation / transparency through policy digitalizaiton execution based on trusted meta-data Depends on existing ICT, maturity and starting point which way to go!

30. 30 | © 2012 Oracle Corporation – Proprietary Recommendations Social Welfare and ICT Always Use COTS. No Custom Coding. Let Business do the Business. Use Natural Language Rule Engines. Let Business do the Business. EU Cloud for Cross MS Eligibility Determination Examine Payment options for the citizens. And ensure assisted self-service Enable Transparancy of Determination Path Ensure automation/STP. Always humans behind For effective solutions, agencies should consider: The 80/20 Rule still apply (80% Organisation and 20% Technology) No-one can eat a whole Elephant in one bite. Create implementation dialog between Customer, Implementer and Vendor. Establish good master-data, as they form the foundation for correct determinations. IMPLEMENTATIONBESTPRACTISE

31. 31 | © 2012 Oracle Corporation – Proprietary Additional sources of information • ISSA White Paper on Oracle and Social Services • ISSA White Paper on Oracle and EFC • Oracle White Paper on Child Support • Example of Citizen/Employee Communication (British Columbia Social Case Managment – ICM). More info here. • Video on Dutch Social Welfare - SVB

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