Distributed Ledger Technologies in Public Services

2. Key Findings and Recommendations

2.1 Findings

This research found an overwhelming international consensus that DLT will have a significant role in underpinning future digital government.

It uncovered a significant global innovation ecosystem focussed on building future digital public services with DLT—spanning government, policy and research, but also driven from the private sector.

Despite a popular narrative of DLT disintermediating central institutions like governments and banks, we found that its most current real-world use cases feature government actors in an extended, more effective, or efficient role.

These focus on DLT's impact on streamlined process and data governance and, in technology terms feature private (or permissioned) shared ledgers.

Beyond this we found future potential for DLT in enabling new public service delivery mechanisms, economic models, and circular economy ecosystems. We note, however, that we found limited evidence of impact to date beyond the public (permissionless) Bitcoin network.

Our research found significant scope and support for the use of DLT in Scottish digital public services. Delivery at scale will require advocacy and leadership within public sector organisations.

We also observed that those states most advanced in considering DLT are small, and that their work is sponsored from the very highest levels of government.

2.2 Recommendations

The overarching recommendation of this report is that Scotland join the international ecosystem as an active participant. This would involve developing a Scottish vision for DLT together with universities and businesses, initiating small-scale projects in the Scottish public sector, and sharing findings with the international network.

Such an approach would include Scotland in the weft and weave of DLT innovation. Scotland enjoys a foundation of research, entrepreneurialism, industry and mature government assets relevant to DLT innovation. The addition of vision, strong leadership and focussed execution could enable positive impact on digital public services, the economy, and in time deliver competitive advantage.

Broad recommendations are as follows:

2.2.1 Envision: Commission an expert group representing the Scottish DLT community, and including views of SMEs, industry, public services, academia, financial services and the 3rd sector, to develop a vision for a future DLT enabled Scottish economy.

2.2.2 Plan: Building on this vision, enable leadership and a plan with specific actions and measurable goals for digital transformation in Public Services. Take steps to embed deeper knowledge and skills around fundamental disruptive technologies in Scottish public services.

2.2.3 Engage: Undertake proactive and co-ordinated engagement with other nations' governments on DLT. Smaller nations are forging ahead. Engagement across central, local government, companies and academia should be co-ordinated with these nations to share DLT experiences and learnings.

2.2.4 Educate: Adopt a holistic approach to drive a DLT ecosystem across industrial sectors by educating leaders on DLT. Work collaboratively with Innovation Centres, local and international SMEs, to ensure that Scotland is able to maximise the benefits of this technology through innovative approaches, such as the CivTech® Programme, CodeClan and the University of Edinburgh's new AI and blockchain accelerator.

2.2.5 Deliver: Appoint a group of progressive leaders from across the public sector to identify common threads of opportunity to deploy DLT to solve common problems. Provide them with a budget to invest in knowledge and undertake practical steps including proof of concept activities. They should actively scan the horizon, share their experiences in the international network, and accept that though some initiatives will fail this is better than doing nothing and being left behind.

2.3 Suggested practical steps

Based on our research with Scottish public services leaders, we gathered findings on the opportunities for DLT application which are summarised here under the themes of people, process and place:

2.3.1 People

The findings primarily focus on situations where there would be a benefit if people could have more control over their own data. Seven examples were identified:

• making transparent the way public funds are deployed in an untrusted environment
• sharing qualifications to allow people to work more flexibly
• opening existing sensitive data up to more professionals, in a secure way, to help protect vulnerable people
• allowing people to supply relevant data once, in a complex multi-agency environment, to make life easier for people from disadvantaged backgrounds
• securing the Internet of Things (IoT)
• enhancing the data available to allow people to be better cared for at home
• streamlining who has rights to make decisions on how people are cared for

2.3.2 Process

The primary finding is that similar processes are being run across the public sector but there is a need for greater collaboration in considering how they could be improved and/or unified.

There are five generic examples:

• Online voting
• The submission and management of legal evidence
• Licensing
• Asset management across organisations
• Supporting economic development with better data

2.3.3 Place

There are two generic examples:

• the urban environment
• the rural environment

These summarised themes are expanded in a 'Public Sector Interview Findings Summary' appendix which will be made available shortly.