Open data and big data for Government: what it is and why it matters

There is a lot of talk about ‘big data’ at the moment – the idea that it is now possible to capture large numbers of observations, and to manipulate the data and capture insights, in a way that could previously not be done.

In public policy circles, too, there is a lot of talk about ‘open data’ – that is, the idea that government holds a lot of datasets and by making these available online to all who want to access them, new ways will be found to capture value from the data. (In other words, by government embracing ‘open data’, lots of people will find a way to take a ‘big data’ approach to it.)

All of this sounds fine in theory, but it can be rather abstract – and quite hard to visualise the practical benefits which might follow from government embracing big data and open data.

So I was interested to go along to a breakfast at Parliament House recently where prominent Australian economist Nicholas Gruen spoke about this issue. Gruen’s firm Lateral Economics has recently prepared a report entitled Open for Business: How Open Data can help achieve the G20 growth target (available here.) The report was backed by the Omidyar Network, a philanthropic investment firm created by eBay founder Pierre Omidyar, and a London-based executive of that firm, Mr Martin Tisné, also spoke.

The report aims to illustrate – and quantify – the potential of open data for Australia’s economy and for all of the G20 economies combined. In the report Lateral Economics argue that an open data approach could increase Australia’s GDP by $16 billion a year, and increase output across all of the G20 economies by around USD 13 trillion over the next five years. This equates to a 1.1% per year increase in GDP – over half of the growth target of 2% which the G20 has set itself.

Here are a few case studies of an open data approach delivering public benefits, drawn from the long list in the report.

- A Canadian economic researcher obtained data on charities from the Canadian tax office – and discovered a significant number of illegally operating charities, with total fraudulent donations of over one billion Canadian dollars a year. Had the tax office published these data sets online each year, the fraud would likely have been discovered much earlier.

- There is substantial economic literature on the benefits that come from people doing jobs best matched to their strengths, and separately on the benefits which come from improved teacher quality. Combining these two approaches, if we could improve the ‘match’ between a teacher and his or her school (by publishing data about potential employers which teachers could draw on in deciding where to work), we could improve teacher quality and hence educational outcomes. Lateral Economics estimates gains in Australia averaging over $2 billion a year from this approach. 

- By using smart sensors in the road network, WA Roads was able to optimise traffic flow over the existing network, and save hundreds of millions of dollars in roadworks expenses.

- In Britain, roadworks.org publishes data on roadworks nationally, drawn from over 140 relevant authorities. This information is used by motorists to plan their trips and avoid delays.   

Lateral Economics say that there are three fundamental ways in which open data delivers a benefit to citizens:

- Providing existing services (both government and private sector) at a reduced cost;

- Enabling new services and improved quality of services; and

- Improving accountability and citizen involvement – which in turn creates greater trust in government, as well as driving improvements in government services (and how they are managed.) 

 Open data is a significant priority for the Abbott Government, and was part of the Coalition’s Policy for E-Government and the Digital Economy at the 2013 election. We made a specific commitment to “accelerate Government 2.0 efforts to engage online, make agencies transparent and provide expanded access to useful public sector data”.

The Lateral Economics report gives some very useful illustrations of why this matters – and why there is a big prize for governments and for citizens by taking an open data approach.