There are three cornerstones to an economy which work in sync to ensure economy progresses – Government, Business and Consumers.
Narendra Modi framed, ‘Less government; More Governance’ and ‘Pro-People; Good Governance’.He envisions a digitised India by 2020 and is taking massive steps towards it.These steps and Finance Bill 2015 suggests the government’s focus and commitment towards empowering citizens.
Any change proposed is a result of three factors –
- Renewed vision
- Economies of scale
Digitising governance also aims to address the same.
- Information – Presently government is a source keeper of a lot of data, which is recorded and stored in a fragmented manner, rendering it unusable for decision making. Making this data usable will be a big challenge with magnanimous benefits for the government.
- Ease of Use–e-governance will be the platform to collaborate with the government. Citizens will no longer have to go to plead, beg and bribe babus to get their work done – they will be able to do it themselves over the internet;
- Transparency – Digitalising governance will help record time stamps and monitor the Turn Around Time (TAT) for resolving consumer and business grievances raised to the government. It can help micro manage the entire process and also provide information about which stage the problem is at and in which government employee’s end is it lying unattended – ensuring proper escalations and desired closure.
Digitizing Governance through Innovation and Technology
The scope of digitization is massive, but one need not be bogged down by the sheer magnanimity of work to be done. One needs to pick up one thing at a time, set a goal and achieve it. This needs to be kept repeating until final vision is achieved. I have the following two proposals to achieve the above three objectives.
In this article, we’ll be focusing on the first objective – Conversion of data into information. The second article will contain proposal to bring in ease of use and accountability through technology. You can read the second article here.
Digitizing Governance through Citizen Profiling
E-governance can help the government internal systems talk to each other through interfaces and convert data into information – which can be used by the government and also businesses. One such step would be in the field of Citizen Profiling.
Have one portal which provides entire information of a citizen using various available databases and convert data into information for better administration, generation of revenue to the government and policy making
Citizen Profiling Portal
Government has a lot of database where information of citizens is maintained – It can extract the same and put it together in one place – Citizen Profiling Portal. Thus, each citizen’s PAN No,Unique Identity Number, Mobile number, Address, Voter ID, Birth details, Family details, Employment details, Passport Number and date of expiry, CIBIL details – Loan amount outstanding, repayment history, Bank Balance, spending habits – Credit card details, taxes paid – TDS deducted, income tax return history, ownership of properties, no of government schemes they avail, if any, demat account details, criminal history / arrests/ fines / open cases in courts, life insurance policies etc should be available at a single place.
- Distribution of Subsidies:
- Linking Bank Accounts to UID for direct benefit transfer model – Presently, 20% of subsidies granted do not reach the target audience – Citizen Profiling will help make the process transparent – right from identifying citizens who qualify for the subsidy tocrediting their UID linked Bank Accounts. This has become possible with opening of 11.5Crore new bank accounts through PMJDY – government’s initiative towards banking the unbanked (covering 99.74 per cent of the households that were outside the banking system). This will lead to phasing out ghost citizens availing subsidies
- Non Regulation of Market Prices – Government has deregulated LPG prices, people eligible to buy LPG at subsidy get the money credited to their account and they can use it to buy LPG at market price. This has led to a lot of convenience – Citizens have the discretion on how to use the money. The government can do the same for other subsidies and deregulate prices of fertilizers, urea, foodgrains etc. Post this, government won’t have to bear the subsidy cost for rich farmers who can afford fertilizers on their own
- Analysing Use of Subsidies – Since UID is granted only to verified individuals, government will be able to link citizens and schemes they avail. It can then identify and stop citizens availing multiple subsidies through various schemes and monitor rules regarding eligibility for subsidies under various schemes through reports generated through the system.
- Audit Trail – CAG will be able to verify transfer of money to the rightful beneficiary with citizen profiling through digital trail of money
- Tax Profiling:
Government annually earns Rs. 19 Lakh Crore through direct and indirect taxes. Out of that Rs. 8 Lakh crore (42%)goes to states, Rs. 2 Lakh Crore goes in defence, Rs. 2 Lakh Crore goes in paying employees and Rs. 7 Lakh Crore goes in making interest payments of sum borrowed! Thus, the government is in a position where it isn’t able to repay debts borrowed. Also, it doesn’t have money for any planned or unplanned expenditure. Unplanned expenditure is paid for by disinvesting stake in public limited companies. Now to support infrastructure which is key to growth, it needs to collect more taxes.
- Identifying Tax Leaks–Government has a lot of fragmented data which if put together can help identify tax leaks leading to revenue losses. Citizen profiling can help the government plug in these loopholes
- Bringing more people under taxability – Presently, less than 3% of India’s population files tax returns. Out of that, only 2% pay taxes. Our present system of tax administration is thus skewed, leading to more burden on the 2% population. Citizen profiling will help Income Tax Department identify citizens who do not file returns / pay taxes and yet afford spending money, owning properties etc. Income tax department can identify these individuals and take action against them for not filing returns and paying taxes
- Bringing black money in the system–To identify citizens not paying any taxes will be a difficult task, as there won’t be any properties on their name. The key to identify these individuals will be to gather all public information through their public profiles on social domains – like facebook, linkedin, instagram etc. This will help identify people who appear to be either living beyond their means or not disclosing income for tax purposes. This will bring black money in the ambit of taxation.
Government can also put together analytics in place to identify indirect taxes paid by individuals running proprietary businesses vis a vis their income
- Improved Planning:
Availability of cross databases talking to each other will lead to better governance and improved planning.
- Demographics – Government can analyse region-wise demographics and make 5 year policy plans accordingly. Eg. Government can now find out kids born in a particular area and number of seats available in that region’s school – It can then decide if an additional school needs to be opened there – channelization of money where it is actually required
- Demand and Supply Gap in Employment – Government can analyse number of jobs available in various regions vs unemployment and give necessary tax cuts or subsidies to businesses to manufacture goods in those regions
- Using Mobile numbers to remit money – to reach the unbanked citizens:
We have 97 crore mobile users in India (77.58% of population), thus mobile subscriptions cover entire population other than kids. Out of this 6.7 crore are smart-phone users; the rest of population is yet to shift to smart phones. In order to reach out to these citizens (90.3 crore) government can push services like M-pesa of Vodafone. In this, a person trasnfers money via an SMS and the recipient of the SMS can withdraw cash with a registered M-pesa vendor (It cost more than banking service, but its reach is far greater than ATMs) Money is nothing but a store of value – the same can be done by mobile balance. Pushing mobile payments by giving licences to telecom vendors to act as payment banks will help reduce the transaction commission and help reduce a significant portion of cash transactions.
Mobile money can be used to achive three objectives –
- Banking the Unbanked
- Using it for internal remittances – A person working in city transfers money to his parents via sms and they encash it without going to a bank which is very far.
- Pushing it for merchant banking–Mobile money being accepted as a mode of payment in normal business transactions
Citizen Profiling Portal can later be extended to also cover Public Limited Companies, Private Limited Companies, Partnership Firms via information shared in public domain/ with ROC, MCA and SEBI.
In order to avoid misutlisation of information for political motives, access to this portal should be granted to a body separate from the government – an independent organisation set up by the act of parliament (like the RBI) having its own vision and mission. It can share information with the government on a need to know basis
Citizen profiling has a lot of pros. It can become an empowering tool for government administration and welfare of the citizens. However, the government also needs to ensure privacy or any of constitutional rights of the people aren’t violated.
Note – This article has been written for http://www.intel.in/ #DigitalIndia.