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February 2001 1
Information & Communication Technology in Social Protection:
Facts, Trends, and Implicationsfor the World Bank
* * *Knut Leipold
World Bank (HDNSP)February 2001
February 2001 2
Intro
• International Conference on Information Technology in Social Protection: Design and Implementation
– May 31 - June 2, 2000, in Warsaw, Poland– 110 participants from 30 countries– Co-sponsored by SP sector of EAP, ECA, MENA– Case study panels:
• Social Insurance Administration Project of Bulgaria• Employment and Training Project of Turkey• Employment Promotion and Services Project of Poland• Presentation of ISSA• Speech of Chinese Vice Minister of MoLSS
– Panel on alternative approaches to IT procurement– Keynote presentations of Australia and Canada– Field trips to automated local Labor and SW offices– http://www1.worldbank.org/education/itconf/
• Two papers:• Costs and Benefits of Information Technology in Social Protection
• Primer on the Inclusion of Information Technology in Social Protection
February 2001 3
Objectives
• Raise awareness of the increasingly important role of Information & Communication Technology (ICT) for Social Protection systems,
• Implications for the management and delivery of Social Protection programs,
• Implications for the World Bank in general and the Social Protection community in particular,
• Share information, experience, and knowledge.
February 2001 4
Content
• Facts and Figures
• Impact and Trends
• Costs and Benefits
• Design and Implementation
• Conclusions
February 2001 5
Facts and Figures:The World
Total ICT Spending 1999 in US$ billion
* Growth between 1997 and 1999
Source: International Data Corporation, 200030.1 (41.5%*)
47.8 (26.3%*)
107.8 (25.7%*)
184.6 (17.7%*)
351.4 (10.9%*)
586.9 (13.2%*)
796.3 (15.4%*)
Eastern Europe
Middle East/Africa
Latin America
Asia/Pacific
Japan
Western Europe
North America
February 2001 6
Facts and Figures:The World Bank
Finance
58 (5.3%)
Private Sector
Development
42 (3.9%)
Mining
9 (0.8%)
Industry
6 (0.6%)
Environment
47 (4.3%)
Education
104 (9.6%)
Oil & Gas
17 (1.6%)
Telecommunications
194 (17.9%)Multisector
19 (1.8%)
Transportation
108 (10.0%)
Water, Supply & San.
47 (4.3%)
Others
2 (0.2%)
Public Sector
Management
103 (9.5%)
Social Protection
27 (2.5%)
Economic Policy
20 (1.8%)
Health, Nutrition &
Population
78 (7.2%)
Electric Power &
Energy
64 (5.9%)
Urban Development
47 (4.3%)
Agriculture
93 (8.6%)
Projects withICTcomponentsby sectors
Source:ESSD Core DatabaseWorld Bank, 2000
February 2001 7
Facts and Figures:Social Protection
Social Protection
27 (46%)
Public Sector
Management
6 (10%)
Private Sector
Development
5 (9%)
Education
5 (9%)
Economic Policy
2 (4%)
Agriculture
2 (4%)
Transportation
3 (5%)
Urban Development
1 (2%)
Water, Supply &
Sanitation
1 (2%)
Environment
1 (2%)
Finance
3 (5%)Multisector
1 (2%)Projects with SPand ICTcomponents
Source:ESSD Core DatabaseWorld Bank, 2000
February 2001 8
Facts and Figures:Lessons
• World Bank supports the use of ICT
• Basic statistics about projects with SP and ICT components– 57 projects with major SP and ICT components, thereof 27 projects listed under
Sector Group Social Protection– 30 projects with SP and ICT components at the same time: ICT in SP or other
component?– What does “informatics” mean in terms of size and volume?
– Spending in dollars only available in terms of total project loan amounts, not for ICT portion
• Use willingness of countries to invest in ICT
• Collect information on ICT spending in $$ by project, by sector, and by region through ESSD Core Database
February 2001 9
Content
• Facts and Figures
• Impact and Trends
• Costs and Benefits
• Design and Implementation
• Conclusions
February 2001 10
Impact and Trends:Automation vs. Transformation
• Automation (supportive)– Existing administrative and operational processes of SP
agencies– Based on organizational structure– ALSO project Poland
• Transformation (driving)– Redesign of SP programs (PROST)– Process re-engineering and organizational re-structuring– Remote UI claim system in the State of Wisconsin
February 2001 11
Impact and Trends:ICT for social service delivery
REPUBLIC OF POLANDMINISTRY OF
LABOUR AND SOCIAL POLICY
THE WORLD BANK
• Integrated delivery of social services,• Meet expectations of the customers,
• Self-service information and transactions,• Single point of contact (One-Stop-Shop),
• Improved image of Social Protection institutions.
February 2001 12
Impact and Trends:Electronic Service Delivery
• Integration– Vertical (UI, Placement, Counselling) – Horizontal (SP, HD, E-Government)
• Customer focus– Services at any place and any time– Participation and decision-making
• Accessibility– Diversification of end-devices– Sharing of resources (Indian milk collection centers, World
Links for Development Program)
February 2001 13
Impact and Trends:Vertical Integration in Turkey
• One clerk as contact partner for all requests
• One application interface for all requests
• Combine commonfunctionalities
Single point of registration
• One database for allapplications
• Same structure for internal (eg. person in human resources) and external (person as appli-cant) applications
Common database
• Skills management for allemployees
• Training to improve the technical skills
• Give best practice experience
Organization
• Ministry ofFinance
• PensionInsurance
• HealthInsurance
• Others
• Human Resources• Job Placement• Further Training• Job Counselling• Payroll• Fixed Assets• Accounts Receivable• etc.
February 2001 14
Impact and Trends:Horizontal Integration in Australia
How can Centrelink help you?Are you:
Changing your marital or partner
status?Leaving home?
Needing help after someonehas died?
Sick or disabled?
Caring for someone
sick or disabled?Arriving to
settle inAustralia?
Responsibe for
children?Planning
your retirement?
Seeking or changing
education?
In a crisis situation?
Looking fora job?
February 2001 15
Impact and Trends:ICT for Social Risk Management
• Public interventions as one SRM arrangement– ICT for increased performance of SP agencies and improved quality of
program and service delivery
• Integrated approach to SRM matrix– SRM strategies - kiosk systems with applications for distance learning
and job matching (both risk reduction), information delivery about SI programs (risk mitigation), or social assistance claim filing (risk coping)
– SRM arrangements - Internet kiosks with financial bank services, training courses of private suppliers, or services of insurance companies (all market-based) and with community-based information and services
– ICT encourages the integrated delivery of an adequate mix of services across the SRM matrix.
February 2001 16
Impact and Trends:Lessons
• ICT is more than technology per se (costumer focus, process re-engineering, integration, organizational re-structuring, program re-design)
• Bank-financed SP projects have seen ICT mostly as supportive factor (automation), not as driving factor (transformation)
• Borrowing countries are willing to transform and implement electronic service delivery
• Potential of ICT to better manage social risk may be used in future Bank-financed projects
February 2001 17
Content
• Facts and Figures
• Impact and Trends
• Costs and Benefits
• Design and Implementation
• Conclusions
February 2001 18
Cost and Benefits:Analysis
• Identification– Initiation, design, acquisition, implementation, operation– Different nature
• Measurement– Measurable vs. non-measurable– Upfront based on assumptions (experience)
• Evaluation– Compare costs and benefits of existing and alternative ICT
system(s)– Basis for decision-making
February 2001 19
Cost and Benefits:Differentiation of Costs
Recurrent costs• Personnel• Supplies• Maintenance & Support• Operational
Investment costs• Technical assistance• Equipment• Software• Training• Facilities
Contingencies• Physical• Price
February 2001 20
Cost and Benefits:Differentiation of Benefits
Category Measurable Non-measurable
Policy Modification of income tax,contribution/benefit rates dueto increased revenues ofsocial insurance contributions
Strengthening ofdecision-makingprocess due toimproved dataprovision
Program Savings due to frauddetection and prevention,increase in revenues due toimproved compliance in socialcontributions payments
Improved publicconfidence in SPprograms
Agency Cost/time savings throughincreased operationalperformance
Improved quality ofinternal processes,customer-friendly
Public Cost/time savings throughpublic self-service kiosks withon-line service delivery
Improved servicequality, IT skills,customer satisfaction
February 2001 21
Cost and Benefits:Examples
Bulgaria: Social Insurance Administration Project (1996-2001)The 1996 present value of savings to the fund was BUL 14.5 billion (pessimistic scenario) orBUL 141.5 billion (optimistic scenario) by 2020. The increased revenues could be used toreduce the 1996 tax rate by 1.67 percentage points (pessimistic scenario) or by 3.5percentage points (optimistic scenario) in 2004.
Latvia: Welfare Reform Project (1997-2002)Benefit processing time will fall from up to 2 weeks, to less than 1 day, with a lower errorrate.
USA: Individual retirement accounts (1998)Providing account information over the internet costs 1 percent of the cost of providingthe information by an operator responding to an 800 number and 4 percent of the cost ofproviding it by an automated 800 number.
USA (California): Biometric technologies for fraud detection in Social Security (1994)California estimates that finger-imaging welfare clients in 7 counties saved the State over$86 million in the first 2 years of operation.
February 2001 22
Cost and Benefits:Lessons
• Analysis of costs and benefits of major ICT investments in SP as basis of decision-making and corrective actions
• Major ICT investments in SP offer a huge potential of benefits– policy, program, agency, and public level– non-measurable benefits may be critical
• Initial higher costs may result in higher benefits
• Don’t underestimate recurrent costs
February 2001 23
Content
• Facts and Figures
• Impact and Trends
• Costs and Benefits
• Design and Implementation
• Conclusions
February 2001 24
Design and Implementation:Key Success Factors
• Design & Implementation– Management commitment– User involvement– Capacity building– Flexibility in change– Professional project management
• Design– Early consideration of ICT potential for transformation– Professional planning
• Implementation– Professional procurement– Sustainability
February 2001 25
Design and Implementation:ICT procurement
THE WORLD BANKREPUBLIC OF POLANDMINISTRY OF
LABOUR AND SOCIAL POLICY
• Many problems with IT procurement• Multiple versus turnkey contracting
• Flexible procurement rules
• Good planning and professional advice• Procurement capacity of agency
February 2001 26
Design and Implementation:ICT procurement
Buyer open to
evaluate differenttechnicalsolutions?
Type ofprocurement?
Use StandardRequest for
Proposals forConsulting
Services
Use SBD for Procure-ment of InformationTechnology Products(off-the-shelf supplyand maintenance)
Straightforwardconsulting services
Straightforward Supplyand Maintenanceof Technology
Complex IT Supply, complex softwareengineering, system development, orintegration services
Use Two-Stage SBDfor Procurement of
Information Systems
Use Single-Stage SBD forSupply and Installationof Information Systems
Start
YesNo
February 2001 27
Design and Implementation:ICT procurement
Name Document Title Comments
ITP SBD Standard Bidding Documents This SBD is for the majority of straightforward technologyfor Procurement of Information supply procurements. It emphasizes strong, professional Technology Products (off-the-shelf procurement of both off-the-shelf technology and of the supply and maintenance) maintenance and support services essential to make it work.Trial Edition, Issued in August 2000. The ITP SBD is also used to implement new process and
content innovations resulting from feedback from users and IT Industry, and therefore it will become a core part of future SBDs.
1Stg. IS SBD Single-Stage SBD for Supply and This SBD can be used for single stage, complex IT Supply and Installation of Information Systems Install cases where the services component of the procurementTrial Edition, 2/99, Rev. 8/00 goes beyond the routine installation and maintenance of
technology. This SBD will be used as a basic building block for the ”Information Systems Engineering” SBD which will target the whole range of complex ICT procurement cases and is targeted for issue by OCSPR in late FY2001.
2Stg. IS SBD Two-Stage SBD for Procurement of This is a transitional SBD for two-stage ICT procurement, Information Systems pending development of the ”Information SystemsTrial Edition, 9/96, Rev. 8/00 Engineering” SBD targeted for issue by in late FY2001.
February 2001 28
Design and Implementation:Multiple vs. Turnkey Contracting
Multiple Contracting Turnkey Contracting
Pros ? Choice for most economicalproposal for each ICT component
? Small manageable contractsminimizing the risk of failure
? Control in user hand without anymonopoly situation
? Specialist contractors
? Flexible timetable
? Single point of contact
? Single responsibility for wholesystem
? ”Bulk-Buy” price negotiatingpower
? International response to tender
Cons ? Requires management capacityand overhead
? Multiple bid preparation
? Responsibility in case of systemproblems
? Loss of information due to lack ofcommunication
? Dependent on single firmwithout control over contractorresources (number, quality,turnover of staff over time)
? Work quality of sub-contractorsand subcontracting costs
? Complex procurement exercisewhich can be inflexible
February 2001 29
Design and Implementation:Lessons
• Take potential of ICT into consideration at the very beginning
• Align processes, organizations, regulatory framework, and ICT systems towards the common goal
• Find committed people and involve them
• Invest in training to build professional capacity and keep it
• Select appropriate procurement approach
• Be prepared for the time after project completion
February 2001 30
Content
• Facts and Figures
• Impact and Trends
• Costs and Benefits
• Design and Implementation
• Conclusions
February 2001 31
Conclusions:Implications for our SP work
• Bridging the Digital Divide: knowledge building on ICT in Social Protection to support transformation and electronic service delivery rather than automation
• Review ongoing projects in terms of possibility of adding ICT opportunities
• Identify, design, and implement stand-alone ICT projects (SP, HD, E-Government)
• More learning events on sharing knowledge on ICT in SP
February 2001 32