Blockchain is a promising technology for the public sector, promoting trust and transparency. Private organisations have been quicker to jump aboard the blockchain train, but the public sector is slowly starting to recognise the added value of blockchain for optimisation of administrative services for citizens.

Some European governments are already testing blockchain on a smaller scale for public services, and now the European Union is considering using blockchain for public administration on a pan-European level. EU member states created the European Blockchain Partnership and are planning to establish the European Blockchain Services Infrastructure (EBSI) to support the delivery of cross-border digital public services. The EBSI is intended to help EU member states optimise and automate public service processes which are long, expensive and labour-intensive, as well as enable exchange of data among EU members.

Automating administrative processes

The EBSI would mean automating public services and administrative tasks throughout the EU member states. To have this infrastructure function, the participating EU states will need to agree on European blockchain legislation and make all necessary legislative changes on a national level to enable the EBSI to run smoothly, connecting and exchanging data between the numerous public agencies and systems. In addition, all participating countries will need to undergo a massive automation and integration of IT infrastructures.

The outcome? Automated digital processes will replace waiting in government offices, and digital approvals will replace the stamped paper documents many countries are still using as the only valid official proof for many processes and administrative services.

The hopes and forecasts are that if everything gets implemented properly, the efficiency of public administration will increase by up to 40 per cent. Currently, the European Union has an overloaded administration that struggles to keep processes up to date. At the same time, the industry sector is also lacking human resources. So, in a way, the private and public sectors are competing for employees. The use of blockchain in the European Union can help automate administrative tasks and enable public sector employees to either upskill for more meaningful tasks or move into the private sector.

Why blockchain?

Why did the EU decide to go with blockchain, a relatively new technology? Blockchain is easy if you want to reference data and exchange it across borders. Public agencies can check citizen data digitally using the citizen electronic ID (eID) when they receive a request from a citizen for some service, such as land registry or a new business permit.

The blockchain will have a consensus between the governments of different member states, citizens and public agencies. Smart contracts will be enforced for the various public administrative processes, and there will be a record of all decisions related to public administration services.

So, citizens basically can do everything from home. They can digitally trigger a process for a public service. The public agencies can then check whether everything needed for that service is OK – have the citizens paid taxes, do they have all necessary documents, are there any criminal issues? If everything is okay, the citizens may move through an automated public administrative process to get the service they applied for. Otherwise, they will need to go to an agency and receive help from a public worker.

Things are simplified because citizens don’t need to transfer documents and data and repeat the paperwork between different ministries. We can create European blockchain runbooks, where agencies can express their opinion about individual processes and data related to citizens. With the blockchain solution, citizens will take their ID, trigger an application for a service, and open a blockchain runbook that will initiate a process to ask all involved governmental agencies whether everything is in order for the citizen to get a permit, for example.

Use cases

So, what processes could blockchain help automate and make more efficient? The EU has several suggestions, such as:

  • Registration of educational certificates in the European Union
  • Public tender documentation, using smart contracts for public tenders
  • Land registry
  • Car registration
  • Applications for agricultural financial support
  • Storing passport information
  • Land building approvals
  • Vaccination records
  • Tax registration for EU exchange purposes
  • Health card and health data registration

Some countries, including Norway, Switzerland and the Netherlands, are already testing blockchain for various services and have seen some benefits. Sweden is using blockchain for land registry processes; Estonia and Norway are using it for digitalised health records.

Switzerland has implemented a blockchain voting mechanism, since it has referendums for nearly all public processes. In Zurich, citizens can vote over their smartphones using their eID. There is no need to create voting commissions, book spaces, print the ballots and count the votes. Everything is done digitally, saving money and resources.

The public administration of our dreams?

The European Union has high hopes that blockchain will enable the provision of more efficient services by improving processes in public and private organisations. Cost and time savings for both the citizens and public administration are just some of the direct benefits. Administrative processing time can be reduced from days or weeks to minutes. And by automating routine administrative tasks, public sector employees can be upskilled and trained to deal with more complicated matters.

The biggest benefit of all is enabling citizens to save time when applying for bureaucratic procedures. The citizens will no longer need to serve as “postmen” running around to various agencies, collecting different official papers.

In other words, we might get the public sector we are all hoping for: digitalised and efficient, serving citizens promptly. That is the very definition of a good public sector: one that provides digitised public services so quickly and efficiently you don’t even notice you are using it.