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How skyrocketing demand for government services accelerated digital transformation

Australians wanting government support during the pandemic quickly discovered ready access to digital records could help speed up each transaction.

While plenty of digital transformation programs were underway across the public sector before COVID-19, Australians’ interest in digital-first interactions with government was massively amplified.

Accountants used to only hearing from clients at tax time were swamped with requests to get financial records up-to-date and digitised. Both major accountancy industry associations noted rapid adoption of digital technologies in 2020 was their industry’s ‘finest hour’ (CAANZ) and ‘major enablers for businesses to survive and thrive’ (CPA). 

At the ATO, there were the added pressures of further streamlining customer service while managing risk to support the commonwealth’s economic response measures

“We want to make it as seamless as possible for people, though it’s not all about putting up a webpage or creating an app,” says Ramez Katf, second commissioner and chief information officer at the ATO. “Those are two important customer-facing elements, then there’s a third element, which is the integration with software and data

“We want to make tax an embedded part of the commerce of business, and the challenge for us and others is wherever we can have it integrated with natural systems, to make that compliance capability even stronger.”

How STP helped smooth the way for JobKeeper

Katf notes the ATO’s support for the JobKeeper program was guided by the department’s digital transformation agenda developed nearly a decade ago. Accountants urged their clients to adopt more digital technologies well before COVID-19, and the rollout of Single Touch Payroll (STP) in 2018-2019 made basic digital adoption a necessity.

Katf acknowledges third-party software developers were “fundamental” in making STP work by providing input in the design and implementation, then helping drive uptake. “We have a very strong collaboration process with software developers,” he says. “It’s become a very important element of our business model because if we want to integrate into natural systems, they are a key enabler in that.” 

When working with third parties on a project, the ATO looks for organisations to “add value to the journey we’re on”, explains Katf. “We make it very clear to our vendors and suppliers that value for money is the first thing we look at – we’re always conscious about that. We’re also looking for organisations that are going to bring practices or experiences from other places that we can adopt. And we need them to understand our business. We don’t want just one of those things to be met; we need them to meet all three attributes.

“Obviously, in the case of STP, it drove their business but they’re also helping collect and verify information for the ATO.”

Other contributors to making STP successful included tax agents, who Katf describes as the “first line in verification of information”.

When the ATO began work on the JobKeeper program, it was determined to take advantage of existing systems – STP data, myGovID and the ATO’s online services. “I think one of the successes was using things people were already comfortable with, and another was the collaboration among our policy group, business groups and technology groups to turn policy into operation,” says Katf.

One of the early collaborative tasks was ensuring features were designed to be intuitive from the outset. Usability testing continued past the build to help the technical and design teams make improvements throughout the rollout.

“From policy to execute, we were talking about 12 weeks,” Katf says. “So an intuitive front end and using the various streams of data we already had made it easy for people to find out if they qualify then enabled us to verify that quickly and not be a blocker in getting the payments out. If you look at the metrics on it, I feel pretty confident we were able to qualify people in an effective way.”

Katf reports the ATO processed JobKeeper claims for nearly four million individuals each month, with around 98% of claims paid in less than five days. More than $89 billion was paid to more than one million businesses during the scheme’s life.

(You can read more about how STP paved the way for JobKeeper here.)

Public and private sector partnerships to deliver myGovID

Collaboration among government agencies on improving ways to manage Australians’ records increased during the pandemic, Katf says. But from the ATO’s perspective, the biggest cross-agency project has been myGovID – a digital version of the 100-point identify verification method.

“About five years ago, government departments began looking at new ways to help people stay secure in a digital world when they interact with government or any other organisations,” he says. “There was a growing recognition that passwords were less secure, so organisations began using multi-factor authentication. We wanted to get ahead of the curve by future-proofing the whole authentication mechanism.”

MyGovID includes several ways to replicate the verifications performed by front-line staff, including an option to scan the user’s face for ‘standard’ and ‘strong’ identity proofing levels. Public testing of facial recognition for myGovID was announced in mid-2020 and the ATO began piloting the method in September 2021. This was five months after it launched a new online business portal and its relationship authorisation manager (RAM) services, accessible via myGovID. 

“The adoption and use of myGovID and RAM have exceeded forecasts,” says Katf. “More than 7.4 million myGovID accounts have been created, with IP2 (‘standard’) the most common identity strength (3.54 million users).”

Katf also reports 1.78 million successful face verifications have resulted in more than 1.72 million ‘strong’ (IP3) myGovID enrolments; 63,000 tax file numbers have been issued; 1.36 million businesses are linked; and more than two million business authorisations have been established in RAM.

“MyGovID and RAM continue to provide a more streamlined experience across government as 31 agencies have transitioned over 76 services, with more services continuing to be on-boarded,” he says. “We created a capability that was able to be reused by government departments at both state and federal level. The TDIF (trusted digital identity framework) was established to set out the ground rules and the parameters that agencies would need to work together. 

“We didn’t do it in isolation. It’s a classic example of collaboration – we created the credential, Services Australia is creating the exchange and Home Affairs is providing the back-end verification step.”

Katf says collaborations on large government projects work best when there are open communication channels and rapid escalation of issues across each organisation from the project and working groups to the most senior levels. 

“I think the collaboration we’ve had with Services Australia over the last while has been positively impacted by having that open communication,” he says. “It’s about making sure you get everybody to agree to the approach and design principles and connected in a uniform way. One of our challenges was getting alignment on some of the design intent because interfacing with other agencies and integrating things is not a one-way street.”

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