David Clark wants to bring New Zealand into the digital age
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David Clark, now in the newly created post of Minister of Digital Economy, sits down with Newsroom to discuss sector where the average job can be worth $ 440,000
David Clark did not give up on the transformation.
As health minister for most of the government’s last term, he called for a fundamental overhaul of the health and disability system and hoped to oversee its implementation. Instead, he stepped down from the role after his infamous Lockdown Beach visit and comments widely regarded as throwing Ashley Bloomfield under the bus amid a border testing debacle.
Clark still sticks to his transformational ambitions, however, this time in the digital space. After the election, he was given a number of new portfolios, including a technical sounding duo that opens the door to major changes. This is the portfolio of trade and consumption and a new job, that of minister of digital economy and communication.
Involve the government
Between the two portfolios, Clark is already planning how life could change in the digital age, with banks being forced to seamlessly share consumer data with their competitors to get New Zealanders the best deal at a large new setting on how we can verify our identities online.
“We are where we are at because of the way the government has organized itself historically. But things are moving fast,” he told Newsroom in a recent interview.
“The interesting thing for me, coming into the digital economy and communications portfolio, is that it’s new. It’s an attempt to bring together disparate pieces of government. It looks like a wallet with a lot of opportunities. “
This separation between the different parts of the portfolio is evidenced by the fact that Clark has received five Briefings to the Incoming Minister (BIM) – letters prepared by ministries and departments highlighting the work they do in a given portfolio. Usually a minister gets only one or two, but obviously there are five different departments working enough in the digital policy space to think it was worth writing a BIM.
“All of these briefings were actually really good briefings, but they basically don’t talk to each other,” Clark said.
This is part of the motivation to create the unique portfolio, to help coordinate action across government. Clark also convened a group of digital ministers to advise on the creation of a guiding framework for policy in the digital space. He and Jacinda Ardern started to call it a digital strategy for Aotearoa.
Describing the strategy, Clark warns that it has yet to go to Cabinet. But he expects it to be broad and not overly prescriptive, oriented around three principles: Mahi tika or trust, mahi tahi or inclusion, and mahi ake or growth.
“What we’re trying to define here is the big picture,” he says.
While the strategy will give the tech industry a better idea of where the trip is going, it will fail to address some long-standing concerns about the government’s slowness to act on the technology, the secretive nature of some of its digital works and his (slowly improving) competence in space.
These criticisms are something Clark rejects.
“I have certainly had conversations with people in the tech industry who have at times been frustrated with the way government moves. But also, those who got involved in government activities have also pointed out to me that they hadn’t appreciated the magnitude you’re dealing with, ”he said.
“If you’re a small start-up, the consequences of making a mistake are that you move on and do something else. If you are dealing with government, the consequences of making a mistake are much, much greater. “
Clark calls this “creative tension” and admits government needs to be more responsive. However, he says he thinks this is happening.
“While working on some of the things about how information was used with the Covid app, there were some very important ethical conversations that took place behind the scenes,” he said.
“It forces a lot of these kinds of conversations and they are actually very important conversations.”
So what are some of the concrete steps Clark wants the government to put in place?
His big project this year is a framework of trust for digital identity. In February, Cabinet approved Clark’s first major policy proposal in the digital wallet, allowing him to introduce a bill to Parliament later this year to create a framework for the development of a “digital identity ecosystem. “.
What does this mean in real life? It means more painstaking effort to prove who you are online.
This goes beyond a redesign of the struggling RealMe system in favor of a decentralized approach to digital identity, where public and private providers can access your digital identity (with your consent) to determine who you are. you claim to be. The framework sets minimum standards and ensures interoperability – so your bank and GP can access the same information without you needing to sign a new set of forms. Participants should also be accredited by the government to ensure that only those with the best intentions and good data privacy and security standards will have access to your digital identity.
Clark acknowledges that it’s difficult to talk about it in a way that everyone understands, but believes it will have major impacts on the way we live our lives. An Australian study found that the benefits of a good digital identity in a mature economy would amount to between 0.5 and 3% of GDP, or up to $ 9 billion for New Zealand.
It can also be integrated into other works. With his consumer hat on, Clark recently announced that the government would advance a consumer data right through separate legislation. This would require certain sectors (probably banks first, then the electricity market) to share consumer data (with that consumer’s consent) with their competitors, to make sure they get the best deal.
In the Cabinet document Seeking to Establish the Law, Clark gives two examples of how it could be used. In one, “an electricity retailer can take a consumer’s electricity consumption from another electricity retailer and use it to offer the consumer a cheaper plan.” In the other, the law would allow “a mobile phone application that allows a consumer to share their banking transactions to monitor their carbon footprint.”
Consistent digital identity standards could make it easier for people to use this data.
“The [digital identity framework] will support the development of trust services that will allow users to securely share their identity online, which is likely to make it easier and more secure for them to access their data under consumer data law, ”the document states. of the Cabinet.
In doing so, Clark hopes to foster an environment where other digital services in New Zealand can thrive.
New Zealand’s digital economy
There are a number of estimates of the contribution of the digital economy to New Zealand, but due to the abstract and amorphous nature of the sector – and how easily it can spread to other industries – we have few definitive figures.
The Ministry of Business, Innovation and Employment, for example, estimates that IT services exports between April 2019 and May 2020 were worth more than $ 4 billion, while Stats NZ says the figure is closer. of $ 1.5 billion per year.
Instead, Clark turns to trivia, pointing to a game company where the average job is worth $ 440,000 in earnings, including $ 400,000 in exports.
“This is quite extraordinary compared to many other industries in the country. But it is also true for our cyberspecialties and many other niche technologies that support other industries,” he said.
In Silicon Valley, the goal of a tech startup these days is usually to get bought out by one of the big companies. This approach is also visible in New Zealand, where three companies sold last year for a combined total of over $ 2 billion. This includes the Ninja Kiwi games company, which was sold to a Swedish company for $ 455 million.
Clark is not concerned, however, that this could hamper New Zealand’s ability to develop its own digital sector.
“These things are a little strained. But there are industry players I’ve spoken to who are actively investing in a lot of other tech companies locally. The ones who’ve made it, who’ve made their $ 100 million or whatever. , are very keen to support those people who have worked in their businesses which are now spin-offs to generate the next $ 100 million business, ”he said.
“There is more capital today than there was even five years ago. Much more. Those who are in the business as entrepreneurs will tell you that there is a virtuous cycle. When they sell, then they have the capital to invest locally. “
However, he concedes, “we also want some of these companies to really succeed and stay here and have their roots here.” The two are not mutually exclusive, he says. Clark points to RocketLab, which does a lot of work overseas, but has fostered the development of an entire ecosystem of local tech companies clustered around him.
It’s the other half of the portfolio that fascinates Clark – the best way to support and better develop New Zealand’s burgeoning digital economy.
“I have five portfolios. It’s a portfolio that I have to say takes up a lot of my head space because there are a lot of changes happening and there has to be a lot of changes. “he said.
“New Zealand has historically been challenged to be a small trading nation, far from the markets. We have long wanted to have products with high added value, sustainable jobs, with a low carbon footprint. These jobs are undoubtedly high value, on average, and have a low carbon footprint. This is another opportunity to sell our products to the world.