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Social Value Creation Report "Safer Cities & Public Services"

Realized by digital governments
Achieving a society where innovations are co-created from the perspective of the user

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August 30, 2019

Due to the spread of smartphones and IoT (Internet of Things) devices, environments in which individuals can access the information and services they desire at any time and any place have permeated rapidly throughout the world. In response, the central and local governments of various countries are strengthening their initiatives for government digitalization. The digitalization of governments improves overall social efficiency and reduces costs, while also enabling fair provision of optimized services to each and every citizen and promoting data coordination beyond public and private sector borders. Developed countries aim to reduce costs of administrative services and co-create innovations through public and private sector collaboration. In emerging countries, initiatives for managing national IDs utilize biometrics with the objective of realizing rapid digitalization on a national level. This report will introduce global and Japanese trends of government digitalization, as well as presenting NEC concepts and initiatives aimed toward providing user-centric public services that are secure, safe, efficient, and equal, and realizing a society that enables unified co-creation of innovation in the public and private sectors.

A shift to digital governments leads to a global trend

The wave of digitalization becomes the tail wind of each country's initiatives

Due to the rapid spread of the Internet and mobile devices, environments in which individuals can always access the information and services they desire have permeated throughout the world. A variety of things have become connected to the Internet via IoT, accelerating the visualization of people, things, and society. The governments of various countries are promoting initiatives for administrative reform through digitalization against this backdrop.

In the 2018 edition of the E-Government Survey run by the United Nations (UN) every two years, it was found for the first time that development of online services could be seen in all income groups*1, showing that administrations in even emerging countries are becoming more digitalized. All 193 member states of the UN have national portals and back-end systems automating core administrative tasks, and 140 countries now provide at least one online transactional service.

The digitalization of governments improves overall social efficiency and reduces costs, while also enabling fair provision of optimized services to each and every citizen. Furthermore, by promoting data coordination beyond public and private sector borders, and creating new social infrastructure and industry, promotion of economic vitalization is also expected. In Denmark, which was named the topranking digital government in a UN survey, digitalizing the issuing of tax invoices has reduced annual expenses by 1.5 million EUR, and fair high-quality services are provided, such as equipping every citizen with a digital PO box.

Digitalization of the government becomes a common issue of both developed and emerging countries

A variety of international organizations are working on measures to promote the government digitalization. OECD*2 is supporting the government digitalization strategies of OECD member countries by providing the OECD Digital Government TOOLKIT. The EC*3, an organization focused on standardization and interoperability, issued Digital Economy and Society Index Report 2018 to evaluate the conditions of each country's initiatives with the objective of raising the standards of entire regions. The report evaluates the conditions of each country so that they can benchmark their performance in each of the five dimensions: connectivity, human capital, use of Internet services, integration of digital technology, and digital administrative services.

Today, government digitalization is a common trend across the globe. Developed countries are continuing to reduce costs of administrative services, while also promoting data circulation through the unification of the public and private sectors and co-creating innovations from the user perspective by combining services. This allows them to maintain and strengthen their national power alongside the happiness of each and every citizen. In a single bound, digitalization has enabled emerging countries to achieve public services that were previously not available to them, allowing them to improve their national power. In order to accelerate the reform of social and industrial structures via digitalization, governments are facing the common issue of strategical digitalization.

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*1 "Income groups" refers to the four stages of income into which every country was divided by the UN in the report.

*2 OECD: Organization for Economic Co-operation and Development

*3 EC: European Commission

Trailblazing initiatives of each country based on national ID

Government digitalization in developed countries

Denmark, which ranked first in the UN's 2018 World E-Government Rankings, uses national identification numbers called CPR*4 numbers, which enables unified management of a variety of information on each and every citizen from birth to death, including their grades in school, medical treatment records, social security, taxes, and more. Digitalization is also advancing in a variety of fields, including the government, energy, the environment, and transportation systems. Research and development for new business creation is progressing with the use of big data collected through this digitalization, as well as with the collaboration of universities and corporations around the world and experts in Denmark.

Estonia, known for its advanced digital government initiatives, promotes ICT utilization as a national policy, providing a variety of highly efficient and transparent digital services to its citizens under the title of "e-Estonia." The backbone of e-Estonia is formed from the Estonian national ID (Personal Identification Code) and the information exchange platform known as X-Road, which enables the exchange of information relating to administrative services on the Internet. The digital ID card given to every citizen 15 years or older is linked with X-Road to enable the use of secure paperless administrative services, including those relating to tax payment, police, education, healthcare, and elections.

Promoting digitalization of governments using biometrics

Emerging countries that did not have the means to provide residency registers in the past are now able to create them through digitalization and spread public services to their citizens. India is introducing the Aadhaar Program, which issues a unique ID to each and every citizen, so that even the most vulnerable citizens can enjoy social security and financial services. The 12-digit specific numbers have already been issued to around 1.2 billion people, and they are associated with each individual's name, date of birth, sex, and address, as well as biometric factors; namely, facial images, all ten fingerprints, and irises. The utilization of biometrics prevents duplicate registrations and identity theft, as well as ensuring the identities of people receiving social security, opening bank accounts, and utilizing other services, and making these processes go smoothly.

As public and private sector coordination expands the provision of various services, the importance of how citizen data is managed and stored increases. Estonia's X-Road is increasing in credibility by distributed storage of data. We expect to continue discussions about how the public and private sectors, as well as residents, can securely and safely operate data into the future.

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*4 CPR: Det Centrale Personregister (English: Civil Registration System)

Japan's initiatives toward a digital government

Realizing user-centric public services through digitalization

The Digital Government Promotion Policy determined at the Strategic Conference for the Advancement of Public and Private Sector Data Utilization held by the Japanese government in May 2017 defined a digital government as "the state in which services, platforms, governance, and all layers relating to digital administration have been reformed to be compatible with a digital society." In order to further define this policy, the Digital Government Implementation Plan was determined at the Digital Government Ministerial Meeting in January 2018, and it portrays two images for society to aim for.

The first is "a society in which the necessary services can be enjoyed in an ideal form regardless of time and place." User-centric public services will form the base for realizing this society. The implementation plan is made up of three principles for achieving 100% digitalization of administrative services: "digital first", which concludes processes and services digitally, "once only", which does not require secondary submission following the first one, and "connected one-stop", which collects procedures and services into a single location. For example, one-stop services of procedures relating to moving, nursing care, death, inheritance, incorporation, and more become possible. In order to realize the digitalization of administrative procedures for individuals and private corporations, data from local governments and other administrative fields must be standardized and made freely available, and an open API*5 must be formed.

A cross-sector data collaboration platform to support innovation co-creation

The second image pursued by the implementation plan is to realize "a society where innovations are co-created by organically linking data and services in both the public and private sectors." CSTI*6, the advisory body of the Cabinet Office, and the IT Strategy Office act as a control tower, mutually linking data collaboration platforms by sector, including agriculture and energy, to construct a crosssector data collaboration platform. With cost reduction and speed being demanded to help solve a variety of social issues, initiatives for resolving issues that exceed boundaries are urgently needed, including reforms to both public and private sector procedures, and sharing information and knowledge across sectors. In this platform, data from the central government, local governments, and private corporations will be linked across sectors to achieve promotion of data circulation through the public and private sectors, as well as co-creating innovation by fusing services.

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*5 Open API (Application Programming Interface): Connection specifications for systems. Open API is an API with specifications made publicly available to external users.

*6 CSTI: Council for Science, Technology and Innovation. An organization with the objective of proposing plans and general coordination of comprehensive and basic science, technology and innovation policies.

NEC initiatives to promote the usage of My Number cards

Supporting the expansion of application situations of My Number cards

The My Number system, a social security and tax number system started in January 2016, is an important social platform which supports the digital governments of Japan. In 2013, NEC established the ID Business Promotion Division in the company to support the systems of the central and local governments, as well as proposing government policies concerning the effective use of the My Number system in the future, which includes private fields. In addition to supporting how the private sector works with the My Number system, we utilize our unique expertise and know-how regarding the system to contribute to the expansion of usages of the My Number card.

For example, NEC provides solutions for using My Number cards as identification for public employees of the central government and employees of local governments. Using the blank space in the IC chip of the My Number card to incorporate an employee identification function helps reduce the burden of identification operations management and improve identity verification. The My Number card may also be used for issuing copies of resident records and other documents at multi-function copy machines installed in convenience stores and borrowing books at public libraries, helping make services for residents more convenient.

Starting cross-industrial workshop on open APIs

In November 2018, NEC worked with advanced corporations in fields such as finance and communications to start the API Economy Initiative, a workshop for cross-industrial innovations that utilize open API to realize secure data collaboration between corporations. One of the themes established in this workshop is the One Stop Service Working Group, which does research on creating one-stop public and private services using the API of Mynaportal, an online service for individuals that is managed by the Cabinet Office.

The workshop will go beyond the borders of categories and industries to perform co-creative activities for solving social issues and realizing a super-smart society. It will also be used to consider business services originated by users and design data collaboration methods that utilize open API, perform research and development on cross-industrial innovations, and propose government policies based on the results of said research. NEC will continue to work with central governments, local governments, and corporations to promote the realization of a digital government by expanding solutions that effectively utilize infrastructures through the My Number system.

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NEC initiatives for supporting government digitalization

Helping create new ways to provide services and run operations in local Japanese governments

NEC is also actively promoting the digitalization of local governments. We are working with local governments to utilize AI (artificial intelligence) in a variety of data analyses to enable the planning and operation of policies and measures that are based on data rather than relying on the intuition or experience of those in charge. We support the promotion of efficient administrative management by local governments through digitalization, including highly accurate financial forecasting to support budgeting operations, abnormality detection to support internal control and inspection operations, and automatic input suggestion to support office work efficiency.

We are also revising conventional office work, which has always mainly relied on paper applications, combining RPA*7 and NEC's unique technologies to digitalize counter services and reduce the burden on both employees and citizens through our Counter Service Revision Solutions. Citizens can input their application details in advance to their smartphones and change that data into a QR code with a security function. They then simply have to hold the code up to the dedicated reader at the government office counter to complete the procedures for making an application. The application data is then captured by RPA and automatically input to the central operations system. Citizens do not need to wait by the counter for service, and employees do not need to physically input data. NEC will continue co-creation with local governments in the future, contributing to the creation of even better public services.

Supporting worldwide government digitalization with advanced technology

NEC has been an active partner supporting the digitalization measures of various countries. In Taiwan, we established a national pension system that enables insured individuals to apply and search for pension via the Internet. NEC also provides biometrics authentification systems that enable identity verification, a necessity for digitalization of emerging countries. This includes the Aadhaar program, which issues unique IDs to each and every citizen in India, and the national ID system of South Africa.

NEC has incorporated advanced IT corporations from the UK and Denmark, world leaders of government digitalization, into the NEC Group in 2018 and 2019. We are combining the solutions and technologies of Northgate Public Services Limited (a company involved in the digitalization of the police, central governments, and local governments primarily in the UK), KMD A/S (KMD) (a company with a robust customer base for central and local governments primarily in Denmark), and Bio-IDiom (NEC's biometric technology) and NEC the WISE*8 (NEC's cutting-edge AI technologies), for further strength and expansion toward the global digitalization of governments.

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*7 RPA: Robotic Process Automation

*8 NEC the WISE is a group of NEC's cutting-edge AI technologies that maximizes human intellectually creative activities.
http://jpn.nec.com/ai/

NEC's vision of the future digital government

Achieving total digitalization of society from the perspective of the user

Rather than focusing solely on governments, NEC believes digitalization that reexamines the overall structure of society from the perspective of the user will help realize a society that is friendly to consumers, governments, corporations, and all of its citizens. For example, biometrics can be used to expand the utilization of national IDs, simplifying a variety of procedures required by central and local governments, corporations, and individuals, therefore helping improve productivity and accessibility. Furthermore, we are working toward shifting administrative procedures to the Internet so that they can be completed at any time and any place.

Open data and publicly accessible APIs will also play an important role in the digitalization of society starting with the government. To make this society a reality, the public and private sectors must work together to improve accessibility and strengthen security. NEC has developed a high-speed, secure, multi-party method of computation. This secure computing technology is used for processing encrypted data without the need for decryption and firmly preventing the leakage of classified information. The improved performance of this method enables its utilization in large authentication systems. This technology ensures the protection of biometric information, customer information, and classified information, supporting the secure and safe use and application of data that exceeds the boundaries of the industrial, public, academic, and private sectors.

NEC will continue to develop cutting-edge technology to advance government digitalization reform, support the realization of a society where innovations are co-created through the collaboration of data and services exceeding the boundaries of the public and private sectors, and contribute to making life better for everyone.

The path to realizing public services with equal accessibility for all

Governments are working actively to create a society which "leaves no one behind", the principle behind the 2030 Agenda for Sustainable Development adopted at the September 2015 UN Summit. NEC believes that the use of digital technologies is an essential part of realizing a society in which anyone can enjoy the benefits of public services equally.

For example, India's Aadhaar Program, which utilizes NEC biometrics, is being used in an effort to create a society in which the entire nation can enjoy equal access to public and financial services. By registering to Aadhaar, people who had no way of identifying themselves in the past are now able to open bank accounts. Citizens can therefore receive subsidies from the government directly to their bank accounts, which also helps relieve concerns about intermediate exploitation and other forms of fraud.

NEC is helping promote the development of national IDs in many countries worldwide. We are providing secure and safe identity verification via biometric technology, as well as accelerating initiatives to realize a society in which every citizen has equal access to a variety of public services at any time and any place.

NEC hopes to design new social value that leverages ICT together with customers and to work toward the realization of a "Brighter World", while placing importance on the pursuit of intrinsic value for society and for customers. We welcome your comments and questions concerning the content of this report and initiatives by NEC.

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