George Osborne: Well, Nikesh, ladies and gentlemen,
thank you. Thank you very much for inviting
me back at the Google Zeitgeist conference.
I can see the uniform hasn't changed at all.
I'm one of only three people wearing a tie,
as far as I can tell in the audience.
But it is good to be here. I thought -- On
my last time, I spoke about the economy. And
I'm very happy in the question session to
answer lots of questions on economic matters
and other things. But I thought I'd use my
opening speech to talk about a subject that
hopefully is a lot more exciting, and that
is you, the impact that you are having as
Internet entrepreneurs, innovators, technologists
on the world of government and politics.
Recent events in the Middle East and north
Africa demonstrate just how powerful the Internet
can be in the fight against oppression. Look
at almost any big social change of the past
200 years, and you will see it has been driven
in a paradigm shift in communication technology:
Newspapers, radio, telephony, television.
And now, most dramatically of all, the Internet.
And for politicians of my generation, that's
an incredibly disruptive impact, but it's
not a threat; it's an opportunity. An opportunity
to build societies that are more open, more
innovative, and more prosperous.
As we all know, virtually every walk of life
is being affected in some way by the Internet
and by new technology.
And that's why, over the course of this conference,
you're going to be hearing from experts talking
about how the Internet is changing the economy,
affecting our culture, transforming our society.
And in my view, the impact that the Internet
is having on government is equally profound.
And that's what I'd like to focus on today.
I'd like to look at three of the most dramatic
ways that the Internet age is changing government:
the way it's changing accountability, the
way it's changing policy-making, and the way
it is changing public services.
Let me take each in turn.
First, changing accountability.
Now, you don't need me to tell you how the
Internet has eroded traditional information
asymmetries. We're all so used to talking
about the democratization of information that
perhaps sometimes it's easy to forget what
a fundamental change it has brought about.
For centuries, literally centuries, access
to the world's information and the ability
to communicate it was controlled by an elite
few, by the powerful, the wealthy, the well-educated.
Today, billions of people can access more
information than entire governments could
access just a generation ago.
And of course the globalization of these information
flows, thanks in large part to mobile Internet
access in Sub-Saharan Africa and other parts
of the developing world, is increasing every
day. This is rapidly eroding traditional power
and informational imbalances. And it's irrevocably
increasing the accountability of politicians
and governments to the people that they are
supposed to serve.
I thought there was a brilliant example of
this during the British Prime Minister's trip
to India last year which I was on. As part
of the trip we thought we would organize a
hack day at the Google offices in Bangalore,
and we flew over some British coders, stuck
them in a year with Indian developers and
social entrepreneurs to see what they could
build together over the course of a few hours,
and they decided to create a new tool that
would make the Indian police more accountable.
And here is how they did it.
In India, giving someone a quick missed call
on their telephone, on their mobile phone,
is a bit like poking on Facebook.
You call someone, you let it ring for a second,
and you hang up and it's a cost-free way of
saying "Hi" or "I am thinking about you."
And what our team of programmers did was build
an app that let's people in India give a missed
call to a special number saved in their phone
whenever they had an unsatisfactory encounter
with the local police.
This missed call then got plugged into a heat
map that showed the rough location of people's
complaints, and so highlighting for the first
time the parts of India where people are most
unhappy with their local police.
This heat map then could be used by civil
society or by government to put pressure on
underperforming police forces to change their
ways.
It's a clever initiative and just one of thousands
of examples of how new technologies is improving
accountability around the world.
And for a long time, governments, including
the British government, was -- were much too
slow to accept this. I think it tells you
something of the culture of secrecy in Whitehall
that Tony Blair says in his autobiography,
I kid you not, he says the Freedom of Information
Act was his biggest regret in government.
Now, maybe there are some other things he
should have regretted more.
[ Laughter ]
>>George Osborne: But from day one of the
new government, we have tried to take a different
path, up to you to judge whether we have succeeded
in doing that, and to embrace the accountability
revolution enabled by the Internet age.
It seems incredible that this time last year
the British public couldn't access even some
of the most basic information needed to hold
the government to account. Spending data broken
down on an item-by-item basis, simply not
available a year ago, is available now.
The contracts signed by central and local
government, now available. Government procurement
tender documents online. The salaries of senior
government officials. Incidents of crime in
your neighborhood broken down on a street-by-street
basis.
And thanks to these efforts, government data
sets like these, 6,000 of them in total, are
now freely available to be analyzed, interrogated,
mashed up and that is only the beginning.
Over the next with 12 months we are going
to unlock some of the more valuable data sets
still locked away in government servers. This
is the raw data that will enable you, for
the first time, to analyze the performance
of public services and of competing providers
within those public services.
So a year from now, Web sites and services
will use this data to help the public find
the answers to important questions like which
is the right G.P. for your family, how well
are different departments in my nearest hospital
performing, what is the quality of teaching
like in my local school broken down by subject
area, was the person who broke into the car
on my street ever apprehended by the police
and what happened next.
Our ambition is become the world leader in
open data and accelerate the accountability
revolution that the Internet age has made
possible, because let's be clear, the benefits
are enormous. Not just in terms of identifying
waste and driving down costs, although the
consequence of spending transparency is already
being felt across the public sector.
No, if anything, the social and economic benefits
of open data are even greater.
Let's take medicine, for example. Now, this
is well-known to people who work at Google,
but a few years ago Sergey Brin, the co-founder
of Google, took a DNA test that revealed he
had up to a 75% chance of developing Parkinson's
over the course of his life. His response,
to use the power of open data to search for
a cure.
He has funded the collection of a huge amount
of health data, drawn from over 10,000 people
which is now being analyzed to yield new insights
into the linkages between drugs, patient behavior,
and the disease. And this approach, using
large data sets to search for possible correlations
and causations, shows the massive potential
for open data to transform scientific research.
The economic impact of this open data revolution
will be similarly profound.
The annual global market for financial services
data analytics is estimated to be worth over
$20 billion.
According to a new McKinsey Report, the market
for health analytics could be even larger,
as much as $300 billion in the United States
alone each year.
And as we all know, with Internet-enabled
sensors increasingly being embedded in cars,
in smart meters, in our electrical appliances,
the amount of data being produced is increasing
rapidly.
This so-called Internet of things opens up
the possibility of new services and tools
from self-drive cars, which Google are seeking
to develop, to powerful dynamic energy efficiency
applications.
And I want the U.K. to be at forefront of
this new wave of innovation. And that's why
our growth policies will focus on open data
over the coming months to ensure we maximize
the business opportunities at hand.
It's why it's great to be able to announce
today that two of our leading universities,
Imperial College, London, and University College,
London, are developing plans for an unprecedented
partnership to create a new research center
that will focus on how we best use the massive
amounts of data -- energy data, transport
data, social data -- being generated in the
world's biggest cities.
This smart cities research center will develop
new technologies in partnership with leading
companies to harness and exploit these new
data sets, support the businesses and technologies
of the future.
And as part of the Tech City Initiative, the
research center will be based in Shoreditch
and will be a fantastic boost to the East
London technology cluster.
So the first impact of the Internet age on
government has been to change accountability.
The second has been to change the nature of
policy-making itself. For just as the old
asymmetries of information have been eroded,
so, too, have been the perceived asymmetries
of wisdom.
I generally believe in almost all areas of
government we do a better job when we open
up policy-making and open ourselves up to
the ideas of the crowd.
We have done it in tax policy where, wherever
possible, we are now publishing detailed tax
changes months before the budget, months before
they get turned legislation so the tax experts
and others can crawl over the drafting, spot
errors and implementation problems.
We are doing it with legislation more generally
through our public reading stage, which will
give people the opportunity to highlight drafting
and technical errors during the parliamentary
process. But we have also done it to generate
new ideas and policy proposals.
In the run-up to last year's spending review,
we didn't leave it to treasury officials alone
to look for efficiency savings and ways to
save money. We opened the process in an unprecedented
way. We launched a Web site enabling public
sector worker to feed in their ideas about
how to best save money and redesign processes.
There were over 10,000 proposals submitted
in the first 24 hours alone. And then we had
a team poring over these suggestions. Many
of them made it into our spending review final
process. And I met many of the public sector
workers who had taken part and felt genuinely
empowered by doing so, that people were listening
to their ideas.
We then opened the process up to the public
and there were hundreds of thousands of people
to took part.
Now, to say that people are disengaged from
the work of government and to say that they
just want their politicians to take care of
these things, that was disproved, I think,
by that exercise. And we are applying this
commitment to openness to government procurement,
too. At the launch of Tech City in East London
last November, one young entrepreneur called
Glen Shoesmith told the Prime Minister about
a problem he had encountered. He had invented
a low-cost technology that allows people to
book slots online at their sports center or
their local swimming pool.
Now, when he pitched the idea to the Olympics
team he was told to find the relevant tender
document and fill it in but the system didn't
know about the product so there was no tender
document and no way for Glen to sell his innovative
product to the government. And this problem
happens time and again, and we're using open
processes to try and fix it.
Last month, we launched an open procurement
competition, an innovation launchpad, encouraging
small companies to pitch to government their
innovative new technologies and services.
In other words, instead of having to wait
for the right public sector tender document
to come along, because it often never does,
you can send your prototype directly to the
government, and leading technology experts,
such as Mike Lynch, the co-founder of Autonomy,
and angel investor Sherry Coutu are helping
us judge the entries and work with the companies
to help them compete and win deals from the
government.
We have applied a similar logic to the challenge
of reducing regulation. Instead of simply
relying on government hierarchies to decide
which regulations should be reformed or abolished,
we have opened the process to the wisdom of
the crowd. We are calling it the Red Tape
Challenge and here is how it works. We are
going to publish, sector by sector, almost
every piece of regulation on the books so
that businesses and the public can feed in
their comments, what works, what doesn't,
what should be scrapped, how things could
be simplified or done with less regulation.
Every single suggestion will be looked at,
and if any sensible proposals are rejected,
ministers will have to explain publicly why.
In other words, we turn the default on its
head. Instead of government deciding whether
or not to listen to the public, we are forcing
government to listen. And we want to remain
at the cutting edge of open source policy-making.
I am pleased to be able to tell you today
that we've just recruited Beth Noveck, who
used to work at the White House running President
Obama's Open Government Initiative, to help
us take this agenda forward, and I can't think
of a better person to do that. She literally
wrote the book "Wiki Government" on how policy-making
needs to change in the Internet change. She
is a genuinely world-class recruit. She will
work alongside the likes of Martha Lane Fox,
Tim Kelsey, Tom Steinberg, on how to harness
new technologies to make government more innovative
and accountable.
So the second impact of the Internet age is
on how we make policy. The third impact I
would like to talk to you about today is the
way N it's changing the way we design and
run public services.
Now, this is in part thanks to the massive
potential, frankly, to save costs. It used
to cost the government ten pounds to process
every single driving license application or
self-assessment tax form. Online, the cost
is less than two pounds per application.
Now, efficiencies like that are too powerful
to be ignored. So if we make the most of this
opportunity, we can, I believe, significantly
reduce the cost of administering government.
Martha Lane Fox, who I just mentioned, the
government's digital champion, argues that
shifting just 30% of public service contracts
to digital channels has the potential to deliver
annual savings of more than a billion pounds.
And if we think about how Internet banking
has gone from a standing start to the mainstream
in just over a decade, there's no reason why
public services can't do the same.
Now, it won't happen by its own volition.
That's why we have made the bold commitment
that all our public service reforms will be
digital by default. In other words, in all
our reforms, we assume that public service
delivery can be shifted online, and officials
and ministers have to justify why any aspect
needs to be delivered through traditional
offline channels.
This is a huge culture shift for government
and it's beginning to have an impact across
the public sector.
For example, with our welfare reforms, we're
designing the new universal credit system
with online delivery in mind right from the
start, not as an expensive after thought.
My own department, the treasury and in-land
revenue has already moved to online only corporation
tax returns, significantly reducing administrative
costs for you, the taxpayer.
In the budget, I announced that over the next
couple of years we will be doing the same
for all the main business taxes, and we're
creating a single government Web site. You
can find the prototype today if you go on
alpha.gov.U.K. and that will allow us to redesign
government services from the bottom-up and
put the user in charge.
Now, because we all know new technology doesn't
just enable us to reduce cost, it can also
help us drive up standards. For over a century,
the dominant assumption in policy-making was
in every walk of life we needed people at
the center micro managing public services.
Why? Because the public was considered to
lack the information and tools to take more
control themselves. And the Internet age has
shattered that cozy consensus. It's opening
up new possibilities to open up public services,
empower citizens and unleash massive innovations.
Let me give you three examples. Personal budgets
will be able to be managed by individuals
online choosing the tailored public services
they need. These are the personal budgets
that people with disabilities, for example,
get.
Patients will be able to access and share
their personal health records and take greater
control of their own treatment.
And communities will be able to use online
platforms to engage with the local planning
system, come together to decide on issues
like zoning and the use of space in their
neighborhood.
Now, of course this age of digitized public
services creates challenges as well as opportunities.
There's the challenge of ensuring the security
of personal data and financial information,
for example.
The hacking into Sony's online PlayStation
network, the theft of millions of users' credit
card details, is a high-profile example of
the need for robust online security.
This applies equally to government as to the
private sector.
In any given month, there are over 20,000
malicious e-mails sent to government networks,
and here is a salient story from the year
that I've been chancellor.
We have seen, during the last year, hostile
intelligence agencies make hundreds of serious
and preplanned attempts to break into the
treasury's computer system. In fact, it averaged
out to more than one attempt per day. This
makes the treasury one of the most targeted
departments across Whitehall. At one point
last year, a perfectly legitimate G20-related
e-mail was sent to the treasury and some other
international partners. Within minutes it
appeared that the e-mail had been resent to
the same distribution list. In fact, in the
second e-mail, the legitimate attachment had
been swapped for a file containing malicious
code.
To the recipient, it would have simply looked
like the attachment had been sent twice.
Now, fortunately our systems identified the
attack and we stopped it, but we're not talking
this challenge lying down, and at the spending
review last year, when we had to take lots
of difficult decisions with the government
budget, we announced we would invest 650 million
pounds in our new national cybersecurity program
to enhance our online security. We're determined
to get the security question right, so that
we can maximize the opportunities that the
Internet age offers.
Another challenge is that we have to ensure
inclusive access, as public services are increasingly
migrated onto the Internet.
After all, there are still 9 million adults
-- 9 million adults -- in the U.K. who have
never been online.
We can and we will address this challenge.
We're going to try and get as close as possible
to a hundred percent connected Britain.
Over the past few months, we've been working
with some of the world's leading technology
companies to ensure that the next generation
is equipped with the digital skills they need
to flourish in the digital age. And thanks
to this engagement, Hutchinson Whampoa, for
example, has agreed to pilot their successful
Digital Maths program developed by the Stanford
Research Institute, which are going to provide
digital tools to support mass teaching in
U.K. schools. BlackBerry has agreed to launch
an apps challenge for U.K. schools, teaching
kids how to design new online applications.
Intel are going to run a range of schemes
to support young people setting up their own
online businesses. And the pollster YouGov
is sponsoring a startup summer program to
provide mentoring, research, funding, cash
prizes to encourage university students to
set up Internet companies.
Taken together, these schemes will benefit
thousands of young people in the years ahead,
and they show how the government is working
with leading businesses to turn the challenge
of change to our advantage.
The same is true across all areas of government.
As we've seen, the Internet is forcing us
to rethink government from the bottom up.
It's changing accountability. It's changing
policymaking. It's changing public services.
These changes are opening up incredible new
opportunities for progress. The opportunity
to embrace new technology, to improve public
services, to tackle old social problems, to
make our societies more open, more fair, more
prosperous, to spread freedom and open markets
to new corners of the world.
Together we can make the most of these new
possibilities and use the power of new technology
to redesign government and build a brighter
tomorrow. Thank you very much.
[Applause]
