BILL SHORTEN, MINISTER FOR THE NDIS AND GOVERNMENT SERVICES: Hi. Good morning, everybody, and thank you very much for inviting me to be here with you for today's Capability Papers forum. First of all, I'd like to thank Aunty Violet Sheridan. A lot of things going on from the weekend, but what you were able to do there is just help us focus and remind us of things. So thank you. And you know, we have 65,000 years of continuing connection to country for our first peoples. I will constantly remain mindful of that and any job I have, and the importance of making sure that everyone in Australia gets an equal opportunity. And at the moment, that isn't happening. I can say to you also, just if you're thinking of leaving Canberra in my electorate of Maribyrnong, where we're still 800 votes up for yes with 3200 to count. So I think we'll just get there in my electorate too. So please come down and feel free to do anything there. I wanted to talk to you today about The Capability Papers and obviously acknowledge we've got some really eminent people, but Cathy Foley and Tanya Monro, real leaders.
I congratulate Innovation Australia for what they're doing. What I wanted to do is talk a bit about my area of government. And when I got the invitation to be part of what you're doing today, I leapt at it, because I think what you're trying to do is fundamental to what we're trying to do in making Australia more responsive to its citizens specifically. And I'll go through some of the particular things that we're doing in my talk in a moment, but I'm conscious when I was chatting to Roy Green and others beforehand, what you're doing makes perfect sense today. But by the end of my talk, I just want to give you some free political advice as well. Now, of course, like all advice that is free, it's worth what you pay for. But I just I'm quite motivated just thinking about your agenda today and what you're trying to accomplish. What is it that we need to do differently to what we've been doing? And I'll come to that at the end.
So there was one person I did want to give a shout out to as well, and he's just a very impressive representative of an amazing nation. Ambassador Vasyl Myroshnychenko,the Ambassador for Ukraine in Australia, you are just most welcome and I think you are doing an unbelievable job standing up for your people against the illegal war by Russia and helping communicate your struggle and the struggle of your people to this country. So I just I shouldn't be surprised that you're here. It just shows that you're plugged in and goodness knows what other things you're looking to do and people you're looking to meet here. But it's great to see you to here. The Capability Papers, It's an interesting concept, isn't it? I have a love hate frenemy relationship with tabloids, the little papers of Australia. But yours is a little paper which I think I could get right behind. I think what's exciting about your publication is that the leaders in technology and research, you're showing an appetite to be the resource and have the discussion of ideas, which I think is very hard in this modern world. You can't learn enough about the future or the present or the past from just scanning rapid fire headlines. We need to have consciously reserved space for thinking about the detail of matters, the hindsight of matters, the direction of matters, and the sharing of ideas. So that's why, you know, fundamentally, I wanted to be here this morning because this world needs more reflection and less rush.
This world needs more consideration and less judgment. It needs more safe places to talk about what needs to be done, and to build a consensus about the nature of change and the benefits of change. So I think there's no question when I look at these capability papers that we are definitely on the same page. My own portfolio and some fun facts about my own portfolio is that we get involved with most aspects of Australian lives. Sometimes Canberra is a two-caste system. There's the policy people. These are the Brahmins. Maybe some of you are Brahmins, the policy people. Then there's the untouchables, that is the implementers. That's Services Australia and others who just roll it out. And I think sometimes in in federal hierarchy of work and processes, policy is regarded as king, implementation, that's an annoying detail which someone else can worry about. But when you think about how citizens interact with our society, if you're sick, if you're unemployed, if you're studying, if you're on a pension, if your house gets flooded, if life intrudes, as it does on a daily basis, you know you need actually government services. You need the implementers over the last five years, Australians have consumed digital services like never before. You know, it's a by-product from natural disasters through to Covid. I think the Australian people are up for transformation, digital transformation. But they want services which not just meet but anticipate the public's needs.
So this is where my area comes right in. We spend, Services Australia is a $5 billion organisation. You add on my NDIA or my NDIS that's another $2 billion in implementation. We are rolling out a lot of services. There's 1.1 billion digital transactions last year done by Australians just for their government. Interestingly 10 million people still visit our physical offices. Challengingly we get a million, 1.2 million phone calls a week, just people ringing up asking questions. We need to move our digital capability. We need to be able to provide services in a timely fashion. So this is where I think we're at at the moment with how we go forward. I think we need to move away from high risk, low investment models of project procurement. We have been too often tech led, not mission led. I think if we want to do things slightly differently and how we can build capability, we need to perhaps look at small, innovative projects where the cost is in single digit millions rather than hundreds of millions, and these projects should align with government and citizens priorities productivity, cost of living, equity, participation. So I want to run past a theory for you today. It's the case for what I call the INVEST model. Invest how we can look at more nimble, agile connections between research to outcome. I think some of you are very familiar with agile methodologies and you'd be familiar with what invest stands for.
- Small and;
So I want to put that INVEST model across what I've been doing in my areas. I think independent is pretty self explanatory, self contained and not dependent on other projects negotiable. The government should be able to negotiate the order in which the projects are delivered. We should be able to deliver it earlier or later than planned, or indeed cancel it without adverse effects on other projects. The project should be valuable. There should be a definite rate of return that is part of the justification for proceeding. It should be estimable before a project's put forward for consideration. The development effect should be well defined. I think small as well large. IT projects have an unacceptably high rate of failure. Agencies have a habit of chasing losses or reinforcing defeat. There's one which comes to mind in my area, which I inherited from my predecessors. It was called the Entitlement Calculation Engine. We allocated $191 million to it. It had to be written off without delivering a project. We've now got the now abandoned Modernising Business Registers Program that cost the federal government $530 million. These are massive numbers. I mean, a side note, if we'd had that program, it would be integral to the work I'm pursuing in the National Disability Insurance Scheme to help stop fraud and rorting of the scheme. So the failure of big projects has a massive ripple effect of opportunity costs elsewhere.
I think the Modernising Business Registers program could have identified criminals who changed their business name and re phoenix themselves, and then set up moved from one government scheme to another government scheme. So we've had to fill up that void. I've had to literally, even though we had all of that investment which has come to naught, I've had to set up my own criminal taskforce just to go and catch people, because the systems which have been in place for years just didn't deliver at all. But I did say there was a final element, the letter T, the project should be testable. The minimum viable product should be tested as soon as possible. I think the entitlement calculation engine is a cautionary tale here. It's unviability was discovered too late after too much money had already been thrown at it. So on a positive note, I'd like to give you the antithesis of a lot of these large project failures, which I've mentioned earlier at another summit, but I think it's worth just talking to you about. Two public servants created a facility which allows for the digital execution of statutory declarations and deeds. In just a few clicks, your identity is verified and your documents are signed. No more searching for a JP or a priest or a judge to verify you and your documents. It's still in development, but there's hundreds of regulations. The federal government should apply a Commonwealth statutory declaration, and the cost to procuring these signatures the old way is horrendous.
This project, which we've invested in, has had a one off $1.5 million outlay, and it's at $1 million for its running costs. It's going to save about $400, $546 million in economic activity. So that is a 9,927% return on investment. Now, what investment banker or treasurer wouldn't like those sorts of numbers? What I like about this process, which is a success story, and I think worth imitating, is that the Office of Regulatory Reforms ensure the initiative's viability from the regulatory and legal perspective. They then looked at the economic advantages and the savings of time. There was collaboration across the Attorney-General's Department, Finance, Services Australia. The project then went into an incubator in Services Australia, where for five days officials just worked through how to operationalize it. There was quick testing and recalibration where it was necessary. I actually think that this proves up the INVEST model. Independent, Negotiable, Valuable, Estimable, Small and Testable. So I think it's a model which can provide the government with the flexibility for the level of investment in each year's myGov project budget. It will minimise risk and it will maximise return. Ten $5 million projects, I think, are significantly less risky than one $50 million project. And if you think about it, you could have 4 or 5 of these projects in our incubator tested to ensure their viability before being sent out into the world. This is not just about investing in tech, though.
It's about investing in tech people. We need public servants who speak the language. Who have the knowledge to know the benefits and the limitations of a particular software program. Or we come back to what I mentioned briefly earlier, that we become tech driven, vendor driven, but not mission driven. And unfortunately, a vendor driven process is less likely to hit all the INVEST model criteria. That's why I think invest goes hand in hand with mission led technology. I think it beats commodity technology purchasing, and you all know it in your own organisations that people fall in love with a particular form of technology, and then we spend the rest of our time reinvesting in that tech as opposed to the original problem it was solving or the original benefit that we were seeking. And of course, the more that you invest in one course of action, the harder it is to change course and reconsider. I do think also, though, and this is coming towards the conclusion of what I wanted to talk to you about, that we need to not just focus on the mission, but we need to understand why we do things in government and for whom we act. Government is not about the holding of power. Government is about the holding of power for purpose. We've had the whole robodebt scandal. At no point did anyone stop in the last government and say, is the purpose of our welfare system, the human rights of people to seek social services? We lost that.
So therefore, as we kept going along, what I want to do is for people who know the mission best, the people who are best at dealing on a daily basis are the users. I do not think the government should restrict itself to procurement and project management, just because consultants say we prefer to stay in our lane. I believe that we have to have invest in in-house digital competency, smaller teams conducting smaller projects. They allow us to make these nimble investments. It allows more junior members of a team to see all aspects of a project from the beginning to the end, to get that engagement and experience. And rather than being a microscopic cog in a catastrophic ICT failure, they can do these things well. If procurements are required, government can have, I think, a huge increase in value for money. And we can also reach out to more small and medium sized enterprises to be part of building up government capability. I do acknowledge that there are some risks with an INVEST approach. I think there's a chance that if we don't manage this well, reusable componentry is neither developed or reused, but I think we can mitigate that risk by using our DTA to identify and ensure the projects develop componentry that has a higher likelihood of reuse. I think a key element of this digitisation of statutory deeds and declarations facility is the use of Digital ID for proof of identity that will be reusable, and it's going to make future projects even cheaper to develop.
I should also just put a place, that the Digital ID for Australians is well on its way towards introduction. Katy Gallagher, our Minister for Finance, is leading this initiative. The exposure draft process of the legislation has concluded. There'll be a bill referred to the Senate Committee for consideration. So that will be another opportunity for organisations and individuals to have a say. I strongly encourage you to do so. I think the success of our national digital identity is going to depend upon a strong partnership between government, the private sector and digital experts. I know the Australian government needs to create the right investment for the private sector to invest. We need certainty. I think a five-year roadmap would provide some of that rollout capability and confidence. If we can say to you, we intend to introduce a whole of government appointment booking capability to myGov in two years, then you can make plans to meet us there. You can innovate on top of what our clear direction and policy horizon is. I think the imperative to work together was really brought home to me when I had the rare privilege of visiting Estonia late last year. A small country, 1.4 million people. Modern Estonia has only been in existence since 1992. In 2006, they experienced the first ever cyber war where the Russians basically tried to shut down the whole country.
What Estonians have realised, I mean, I guess it's the dilemma of having a terrible neighbour on your border, is that they need to have the best possible public/private partnerships. Did you know they have a digital ID card which connects 3000 government and private databases? It's a government service system available in their digital ecosystem where you can have your ID, which is good for your insurance, your retail, your pension, your driver's license. Estonians have answered questions that our lumbering bureaucracy, a nation is too scared to even ask. We're not going first. It's just important that we don't come last. Collaboration rather than competition has got to be the key. There's no doubt that we've got a lot of work to do in Australia. I'm confident. I'm in a room full of people who've been working at the coalface of a range of capability issues, interface with innovation and research for a very long time. I'm confident your papers will spark more conversation about our tech and digital future. As I said, I'm here because your conversation is important and I respect it. I hope what I'm putting to you today perhaps fuels some discussion, because I think, and I'll finish on this point, the biggest challenge that we have in the room is not our is not our brains. It's how do we move the political dial? How do we get buy in that creates an ecosystem?
And this is the last free bit of advice I wanted to provide to you today. There are so many smart people in this room, but then you've got to ask yourself if you feel that we're not moving the dial, now you are a bit by the way. I'm not saying we're not, but if you feel that you're impatient for more progress, and a greater discussion about the ecosystem of funding of science and innovation and research and capability. Then maybe the problem could be up on the hill. Or maybe the problem is here, and don't take offense. If you do the same experiment the same way and expect a different result, you know, that's silly. I think Einstein said it in German much better. But I just want to put to you that maybe we just need to think slightly differently in how we educate people about what the purpose of it all is. These papers are good, but the question I got when I was, when I was flicking through them, is who is your audience? If your audience is each other, this is fantastic. But is that the only audience you need? So I think that we've got to look at how do we move the political pressure points. Now our government is interested. We've got so many different shops investing in expenditure, it's incredible. As I said, in Services Australia we spend over $1 billion a year on ICT.
Tax spends that, goodness knows what defence is spending and that sort of stuff we've seen. And you know there's the visa systems. There's huge shop spending. In the NDIS, we are paying out each year to people with disability $35 billion in payments. Where's the research budgets for any of those? So and you could multiply that across the system. Now I know many of you are doing work. And you may feel that this presentation in part is a little precocious. And what am I driving at? I just say there's a conversation to be had and not this morning. You've got a lot of good stuff to go through. What is the 1% you can change about the way you make your case for support? It's the 1% you need to change, because I think Australians are up for a lot of the discussions and the benefits you talk about. But somewhere between the massive brainpower in this room and the papers representing, our universities and our research institutes and our private sector investments, and the great work that government research is doing. The sum of the parts of the Australian science and research effort, is less than the individual bits. Now, it's very good to talk to you this morning, and I'm certainly turning my mind to all of these matters. And I think this INVEST best model might be a good sort of proposition to consider.
Thank you very much.