E-government/The Challenges of E-Government

Who pays for e-government?
Like any government infrastructure project, e-government can be done in phases and the costs of implementation will depend on current infrastructure availability, supplier and user capabilities, and mode of service delivery (whether through the Internet or through telephone hotlines and one-stop shops). The more complicated and sophisticated the kind of services the government wants to offer, the more expensive it is.

Governments should focus on small, self-financing or outsourced projects. Because e-government projects must be financially sustainable, there must be a revenue/ cost-reduction model in place from the beginning. Smaller projects with a clear revenue-generation strategy and minimal initial investment are the most likely to be sustainable over the long term. For instance, Web sites are one of the easiest and cheapest ways to achieve high impact e-government with a minimum of investment.

e-Government projects are, more often than not, long-term endeavors, requiring large capital infusion in software, hardware, infrastructure and training. A viable financing plan should not only pay for the immediate needs to jumpstart e-government; it must also consider its long-term financing options for the sustainability of the project.

There are various business models for funding e-government projects, and the private sector plays a critical role in these. Under partnership arrangements, the private sector builds, finances and operates public infrastructure such as roads and airports, recovering costs through user charges. Various financing schemes exist—from soft and development assistance loans from donor/multilateral aid agencies to partnerships and outsourcing deals with private third party vendors under special financing schemes (e.g., the Build-Operate-Transfer or BOT scheme) that can minimize the initial cost to government.

BOT and its variants are usually the favored financing models/arrangements for government projects that require large and immediate financing from the private sector. Under BOT, the private sector designs, finances, builds, and operates the facility over the life of the contract. At the end of this period, ownership reverts to the government. A variation of this is the Build-Transfer-Operate (BTO) model, under which title transfers to the government when construction is completed. Finally, with Build-Own-Operate (BOO) arrangements, the private sector retains permanent ownership and operates the facility on contract.

Cooperation, rather than competition, with the private sector can facilitate effective e-government. Government can encourage private sector investment by complementing and supporting private sector efforts rather than duplicating them. The key to e-government is to improve citizen access to service delivery, not further expand the role of government. Government should not attempt to create products and services where public-private partnerships or private service providers can adequately provide these products and services more efficiently and effectively.


 * Box 15. E-Government Financing Through BOT: Malysia’s National e-Procurement System

How do you get the wider public to actually use e-government services?
Any sound e-government policy must consider a citizen-centered approach. This means that e-government should be an end-user or demand-driven service.

However, many citizens do not use e-government for several reasons, among these unfamiliarity with ICT, lack of access, lack of training, and concerns about privacy and security of information.

While e-government may provide ease and convenience in the delivery of public services, and offer innovative government services, none of these will prompt citizen use unless the concerns mentioned above are first addressed.


 * Box 16. Citizen-Centered E-Government: Singapore’s eCitizen Help Centers

Why are security and protection of privacy important?
Security generally refers to the protection of information system assets and control of access to information. Security policies and strategies are context- and information-specific.

Privacy refers to the right for information attributed to an individual (also called “nominal information”) to be treated with an appropriate level of protection. Information privacy protection laws are often put in place to regulate this.

Protecting the privacy of citizens and assuring them that their personal information will not be compromised is critical in e-government because this is the key to user trust. Without this assurance, no one will be prompted to use e-government services.


 * Box 17. E-Government and Privacy: Japan’s National ID System