I'm a (non-US) federal public servant who worked for a small, and now defunct, agency with the mandate to embed 'user-centric' design principles in the creation of public services. At the time we were wound up, I concluded we had failed. Now I'm less sure. I still occasionally see instances where our work has influenced other public servants, so perhaps we've had some measure of longer-term success. You should carefully think about and define your metrics for 'success', both in the short and long term.
All that aside, the key reason for poor design in government is this: lack of incentive. And no, the ballot box is not an effective incentive; very few voters will punish a government because their tax return form was poorly designed. Private companies possess this incentive: if your product is hard to use, people won't buy it and you'll go out of business. Government doesn't have this incentive: if people find your products hard to use, they'll use them or they'll (eventually) go to jail, won't get their welfare payment, won't receive a driver's licence etc.
Outsourcing or privatising these kinds of services is not the answer: you're just substituting a public monopoly for a private one, which arguably leads to worse outcomes for citizens (and great ones for the private monopolist). This kind of action only makes sense if a competitive market will form after government gets out of the way. It's helpful to think of government services in this fashion: a service market that is dominated by a monopolist.
So that's the problem you are attempting to solve: how do you get a monopolist with no profit incentive to design better products and services?
Could a setup help with this unfortunate incentive situation, wherein independent frontend providers would get a small, fixed fee from the state for each case handled through their systems? They would invariably compete for users on the usability front. And if those fees (oh no, fixed! Where is that sacred free market?) turn out too big it would not be as catastrophic as one may think, because they would not just get filthy rich/reinvest in shady lobbying (like traditional government contractors, e.g. military technology), but would put much of the excess money into advertisement, keeping the bullshit-job flywheel spinning that our postindustrial societies are relying on to keep an acceptable number of people employed.
I see a few potential pitfalls, but it should be doable and cheap. The meta-system would have to be balanced between two failure modes. One would be to allow frontend providers to optimize their revenue by case-inflation, like making their users run to that virtual tax office more often than strictly necessary, e.g. by shoddy implementation of corner cases. The other would be discount providers specializing only on the easy cases, making it unnecessarily hard for more complete providers to make their living.
I've often wondered about similar things, but admittedly haven't done any formal analysis.
I suspect it's situation specific: there are probably situations where a model like this would work very well, and others where it would be a terrible idea. I'm also a little wary of government created 'pseudo-markets', as these often become bureaucratic nightmares that cost more to administer than if the government had just done the thing itself. 'Pseudo-markets' are kinda like machine-learning algorithms: they'll optimise towards your success metric, but sometimes in unexpected and undesirable ways (i.e. game the system).
Also, for certain services, you'd need to ensure equity of access (i.e. cover all use cases). Tax returns are a good example. There's some pretty esoteric stuff in tax returns that are only relevant to a handful of people (e.g. reporting franked dividends distributed from closely-held unit trusts via an interposed corporate entity, or whatever). It might never be profitable for a private market to cover this case, meaning the government would have to further 'pseudo-regulate' its 'pseudo-market', offer further subsidies, or cover this use-case itself.
Interestingly, on your second 'failure mode', you could flip it around and view it as a desirable outcome. Sticking with income tax reporting, most reporters have pretty simple tax affairs. They just report their annual income (which the government already knows), maybe claim a deduction or two, and that's it. But because the government must cover every possible use case, people are forced to wade through a 40 page form instead of a 1 page form. There might be more gain to society from doing this:
1) Government offers the fixed subsidy, but makes clear it is only guaranteed for, say, 2 years.
2) After 2 years, offers a lower (or no) fixed subsidy for the 'cherry-pickers' (who will still be profit positive)
3) Reallocate the savings as higher fixed subsidies for the remainder of the market
By iterating this process a few times, the market would naturally segment according to complexity, allowing the government to accurately 'price discriminate' on the basis of complexity. I dunno, I'm just spit-balling here, no clue if this is actually a good or bad idea. What are your thoughts?
Of course, all of this is only possible if the government publishes a 'tax return' API that's easy to use (i.e. does not create high implementation costs for private providers). Even though publishing an API sounds (and, frankly, is) simple, you'd be astounded at how often the government screws this kind of this up (often by contracting out to IBM, Fujitsu and their ilk). Or not publish one at all, even though the potential benefits are blindingly obvious...
I see two differences hidden between much overlap: expert/layman and embrace constant retuning/embrace creeping detuning. Since we are only taking about allowing investors to tap into possible efficiency gains in the execution of bureaucratic processes (and not into actual resource allocation, as it happens for example in highly regulated but not fully state-run healthcare systems or in renewable energy programmes), there is a natural upper limit for disoptimization. So in a way this problem is much easier than other, very similar regulation/gaming the system scenarios and a loose reins approach should be less risky.
Indeed. Much of what I see from the UK GDS is bang on; there are clearly some very bright people there. Take a look at their guidance to other government agencies on exposing APIs: https://www.gov.uk/service-manual/making-software/apis.html
It's concise, in plain English and very cleverly avoids using the terms REST or RESTful even though they're basically describing RESTful architectural constraints. It's clever because they avoid getting dragged into religious wars about API technicalities and provide flexibility for situations where fully REST-compliant APIs are not practical.
I wish more public servants (and politicians) understood web APIs and the economic value that would be unleashed if governments exposed more (both data and transactional). But instead, most are obsessed with building 'portals' and 'mobile apps', because those are 'innovative'!
Agreed - and echoes a similar case I read about when the folks behind the Ordnance Survey (government agency and makers of truly exceptional maps for outdoor enthusiasts in the UK) proudly showed how they made their data online for a licensing fee that generated about £10m a year.
The people they were presenting to? A group of European governments that endorse massive, free access to this sort of data - as a means of spurring innovation and economic growth.
Now contrast that with London Mayor Boris Johnson's movie to open up the data for their city bike sharing scheme... released on a Friday, by Monday there were two apps that were slicker and better-developed than the city was planning, plus were now two small businesses.
Yeah the whole 'charging for government data' thing drives me crazy!
In almost all cases, the marginal cost of producing the 'good' (data) is approximately 0. Furthermore, because infinite copies of data can be made, there is no reason for price rationing. And there's no argument for granting monopoly through artificial scarcity (like there might be with patents and copyright) as the government would have produced the data anyway (often as a byproduct of some other activity e.g. income tax reporting).
Government data is a public good, in the strict economic sense (non-excludable, non-rivalrous).
Setting prices above marginal cost (i.e. 0) causes significant dead-weight loss; it is absolutely inexplicable and inexcusable public policy. This isn't complex economic theory. This is economics 101; you'll find this information in any first-year uni economics textbook (in the 'market failure' chapter). I can only conclude that public servants who do this kind of thing either aren't familiar with extremely basic public economic theory (which is a bad sign), or are actually trying to reduce public welfare (making the public service a rather odd career choice).
Conceptually, charging for government data is equivalent to levying a super-narrowly based and highly inefficient sales tax. The most baffling thing is that it's conservative governments that generally approve these kinds of policies, even though the net effect is to increase the size of government at extremely high efficiency costs.
All that aside, the key reason for poor design in government is this: lack of incentive. And no, the ballot box is not an effective incentive; very few voters will punish a government because their tax return form was poorly designed. Private companies possess this incentive: if your product is hard to use, people won't buy it and you'll go out of business. Government doesn't have this incentive: if people find your products hard to use, they'll use them or they'll (eventually) go to jail, won't get their welfare payment, won't receive a driver's licence etc.
Outsourcing or privatising these kinds of services is not the answer: you're just substituting a public monopoly for a private one, which arguably leads to worse outcomes for citizens (and great ones for the private monopolist). This kind of action only makes sense if a competitive market will form after government gets out of the way. It's helpful to think of government services in this fashion: a service market that is dominated by a monopolist.
So that's the problem you are attempting to solve: how do you get a monopolist with no profit incentive to design better products and services?