Blockchain in synergy with the Government
We live in an ecosystem that is built by us and for us. It is important to keep this system regulated. Since we are a 7.7 billion population, it is non-viable for us to regulate the world. For this, we have the public sector which is our Government.
The government handles sensitive and authoritative data. Since the government is also a unit-body of people, it is comprehensible that it may commit mistakes and fall into traps. Day by day, the public sector is working towards enhancing its efficiency. It is experimenting with and adopting new technologies for better functioning. One of the currents explored technological arenas is Blockchain.
According to one of the IBM’s IT professionals, Sudhir Khatwani, “Another initiative can come from the government and regulators itself where it can strive to be open-minded about blockchain technology and experiment with various uses cases. This segment, if explored thoroughly can save millions of rupees for the Indian government and bureaucracy by removing the middlemen at various stages across many sectors of government endeavors.”
Challenges in the sector
Blockchain transforming the ecosystem’s framework
Blockchain bolstering the Government
Blockchain is strengthening various use cases for the government. If the Blockchain mechanism can successfully be implemented in the public sector, it can systematically structure the sector. Few implications of Blockchain in the public sector are:
Identity Verifications
The government sector is responsible for storing citizen’s identities like ID cards, birth certificates, passports, driving license, voter ID, ration card, etc. These verifications are needed for various purposes like security, data collection, and census.
There are different levels at which blockchain technology is implemented for better management of identity registrations. From digital Identity management to data storage, to identity verification, Blockchain can tackle these challenges through its distributed-ledger property. Deloitte’s research on ‘Blockchain in Public Sector’ states, “DNV GL, a global quality assurance and risk management company, in partnership with Deloitte EMEA Blockchain Lab, has implemented the first live blockchain solution in the certification industry and has transferred all its 90,000 certificates to a private blockchain.”
Voting
Voting is an essential part of the public sector. The foundation of the government depends on the votes cast to the represented electoral parties. Thus, self-explanatory- due to its essentiality, voting faces an intolerable amount of data tampering. Government elections are under threat from the malicious actor as they can infiltrate current voting machines and alter the voting database.
Deloitte states, “Potential solutions are currently working to blend secure digital identity management, anonymous vote-casting, individualized ballot processes (for example, a vote “token”), and ballot casting confirmation verifiable by (and only by) the voter. The Australian government-owned Australia Post has unveiled plans that it will conduct tests through digital voting via the blockchain technology in a bid to reduce costs and improve the efficiency of a parliamentary election.”
Academic Security
ICEF, International Consultants for Education and Fair, estimates that by 2030 the total number of enrolled students in higher education will reach 380 million. This is an estimation of registered students of only higher education. There is n number of illegal institutions, diverse levels of education. Thus, it is fathomable, the education industry is massive. The industry is filled with unregistered academic certificates. It is challenging for the government to track down these illegal accounts and institutions.
“… government institutions are embracing and relying on blockchain for tamper-proof record-keeping of digital certificates,” says, Deloitte. The University of Melbourne, The Education Industry of Malta, and the Massachusetts Institute of Technology (MIT) are taking initiatives to register, store, and share academic credentials on Blockchain. Deloitte also mentions, “Not only government, but even industry players like Sony are trying to build a suite of educational services on a -blockchain platform, which would use the technology in part to secure student records and form part of a system for sharing that data between agreed-upon parties.”
Tax Collection
The most evasion-witnessing department in India is the tax department. On mentioning tax evasion in India, Economic Times states, “… 2.02 crore individuals filed income-tax returns in 2017–18 declaring their income, but paid zero tax since they are not in the taxable income bracket yet. Deloitte mentions, “Blockchain also has applicability in smart contracts — agreements that can automatically trigger actions under certain conditions, such as when payments are made or missed.”
Smart contracts can streamline the tax collection process by matching tax data with income transactions, thereby calculating tax and deduction if any. A smart contract can, also, trim down legal and administrative costs by being self-enforceable.
Asset Registration
Asset registration like Land registration, in most countries, is a lengthy process. It is commonly a paper-based procedure, involving several intermediaries making the time consuming and costly. Decentralized nature of blockchain can help in reducing the number of intermediaries, expedite the process efficiency, save time, and decrease costs
Deloitte’s research on ‘Blockchain in Public Sector’ marks, “It not only provides a trusted mechanism of storing and transferring data but also provides transparency across the system. Several countries and states such as Sweden, Ghana, and Georgia in the USA are exploring blockchain-based solutions for digitizing registration of land and property transactions. Sweden has successfully completed a pilot where land registry copies are shared with all relevant parties to facilitate property purchases with each step of the sale is verified and recorded on the blockchain.”
EXPERT’S VIEW
A blockchain-based registry platform — with governments, businesses and intermediaries as a node(s) — enhances transparency and streamlines the process of sharing registry data.
- Juan Delacruz, Transformation Executive — IBM Global Government Industry
Conclusion
Undoubtedly, for ensuring the growth of a nation, it is crucial for the government to adopt the best methods in favor of the people. Further, it must be rightly appropriate to counteract the issues being faced by the general population and thereby serve them in the best possible manner. Based upon the progress made so far in the adoption of blockchain by the government in the public sector, it can be estimated that the government procedures will be more streamlined with reduced costs, better security, and more transparency.
In conclusion, Deloitte rightly argues, “Government departments looking at digital technologies as enablers of competitive advantage and disruption, should not overlook blockchain. Though it may still take some time before we begin to see large-scale commercial applications, it is increasingly likely that many industries, citizen services, and government programs will feel its impact, sooner rather than later.”
Compelling. Isn’t it?
Written By: Ayushi Jain (ayushi@wharfstreetstrategies.com)
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