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Australia is being left behind as a digital economy and government departments and the public servants who work there could be key culprits, according to a new report. Accounting giants Ernst and Young say the Commonwealth government is failing in its key duty to drive digital innovation and put it into use in the everyday lives of Australians. The EY research, Digital Australia: The State of the Nation published on Monday, finds Australia stuck in the slow lane with action now urgent to catch up with the United Kingdom, Singapore, Belgium and even New Zealand in government-led technical innovation. The report's authors say the public sector must be a driving force in a nation's development but the survey accompanying the research shows that even digital "opinion leaders" in government department are not happy with the pace of progress. Respondents in the 1500-strong survey sample, which also included private sector players as well as consumers, complained of mediocre standards, poor delivery of e-commerce and a lack of innovation. Australia's notoriously slow and expensive internet is now hurting "all aspects of business, government and the community" and the accounting firm says the completion of the National Broadband Network is vital to the nation's future as a modern economy. There are some bright spots identified in the report, like the growth of myGov, the recently established Digital Transformation Office, and the use of data by the Immigration Department and the Australian Electoral Commission to improve their systems. But myGov is just scratching the surface of what has been achieved by official portals around the world and the DTO's stated aim of achieving its ambitious goals by 2017 are "ambitious", according to EY. "More powerful and innovative solutions are required," the report states. "For example, the myGov portal could become the broker for digital government service identities, with the potential to link to state and local agencies – if government at all levels can find the organisational 'will' to support this." But public servants might be part of the problem, instead of the solution, the research indicates. "Countries that have excelled at digital innovation have uncovered the real reasons for resistance," the EY researchers wrote. "A significant barrier appears to stem from internal resistance to collaboration. "This was demonstrated at Belgium's Cross Roads Bank for Social Security and at Service Canada, which both used citizen opt-in, consent-based models. "Both found bureaucrats were responsible for resisting cross-agency data collaboration." The researchers want privacy legislation boosted to include mandatory reporting for data breaches, a Privacy Commissioner with teeth and real consequences for government agencies and private companies who abuse citizens' privacy. Building trust in "opt-in" systems would allow government to think big, the authors argue, with decades of data now making it possible to view a citizen across their entire life, allowing an agency to anticipate a person's descent into long-term unemployment and intervene before it happens. EY Customer Leader Jenny Young said the report was a call to action, before Australia falls even further behind in the commercial and social benefits that technology now offers. "There's a lot of urgency to realise the opportunities and improve digital delivery," Ms Young said. "The longer we wait to improve product design and service delivery, we will continue to delay being able to realise some of the productivity benefits as well as some of the social benefits that Australians expect."

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