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2020 is a year that will go down in history as one of the most challenging yet. It was a year of uncertainty, complexity, and change. As we forge ahead into the new year, we take with us valuable lessons and renewed strength.

Based on the collective experience of our KPMG in Singapore professionals, we've identified key trends in the Government sector to offer indications and insights on how the world is changing and how the industry might prepare for our new reality ahead.

  1. Digital adoption will remain high on the immediate priority list. What COVID-19 has shown governments is the importance of not just digitising business processes, but also ensuring that business models can be transitioned into the digital world with speed and efficiency. This applies both to public services and industry at large. Most governments in the region will have to strengthen their digital infrastructure to enable businesses to carry out their day to day business at high speed. Singapore has been ahead of the curve in this regard with the investments in the National Broadband network over the last decade, and will have to continue these investments in the 5G era. Others will have to further invest in and strengthen their digital infrastructure to reduce the bottlenecks that have been faced in 2020. We also see the continued implementation of digital delivery models in a range of public services from health to education, which will require significant process redesign and technology deployment. The important shift will have to be to enable hybrid services where both digital and physical services can co-exist. Sectors like building and construction, facilities management and security which have been slow to change, will be forced to accelerate adoption of digital models, including robotics and automation, as restoration of the foreign workforce to pre-COVID-19 levels will be challenging. Orderly reopening of economies and restoring consumption across ASEAN will need to see unprecedented levels of cooperation in vaccine confidence building and the delivery and establishment of travel protocols. Digital tools and methods have a significant role to play in enabling these to happen seamlessly and at low cost.

  2. Innovation will be required to address continued pressure on government budgets. Scarcity has been the mother of invention. In 2020, unprecedented budgets were harnessed in order to save lives and livelihoods. The new waves of the virus and the emerging mutations suggest that the fight will continue well into 2021 and possibly beyond. The large sums of money which were spent on ensuring that the lowest sections of society were protected and the free market did not result in significant job losses, will gave way to more targeted interventions for the most vulnerable sectors. While a number of markets will see recovery of domestic consumption, those economies significantly driven by tourism will still have some way to go to restore business to pre-COVID-19 levels. We expect that government funding will shift to support greater product and service innovation, reskilling of the workforce to adapt to new digital models and potential consolidation in the industry. COVID-19 has only fast-tracked the industry pressures that were already evident in these sections of the economy. There will be a focus on doing more with less and non-value adding projects will most likely be canned. Investments in Internet of Things (IOT) and the consequential availability of improved data and analytics will provide deeper insights on the emerging changes in demand patterns in transport, utilities and facilities infrastructure. This will enable better informed decisions on the sizing and timing of future government spend in these sectors. Some economies are exploring active involvement of the private sector in the delivery of services and limited divestment of non-core assets through public-private partnership models, which could alleviate short-term budget pressures. All this will be against the backdrop of limited flexibility to raise taxes in 2021 as governments may not want to stifle a fledgling recovery yet.

  3. Citizen centricity in services. Digital adoption will need to be accompanied by a drive towards simplifying and putting the citizen at the heart of all public services. In this regard, we see the citizen in a broader light covering employees as well as small businesses as stakeholders of government. This will mean a lot more focus on user experience and `moments’ of impact with fewer but higher quality face-to-face interactions. Most government systems over time have been developed with a focus on efficiency in transaction processing and built around conventional workflows. With changes in citizen expectations and consequential movements required in service delivery, these islands will have to be stitched together or `connected’ in a seamless way to deliver an outstanding customer experience. Investments will be required in agile technologies and methods to enable these changes to happen at light speed. Governments will have to work in partnership with their service providers in successfully effecting these changes, in a world where high quality technology talent will continue to be in short supply. With increased simplicity of end-user experience and the ability to access services across a range of devices and platforms will come the need for greater security and privacy of user data and the necessary cybersecurity. Governments will need to harness feedback on social media to good effect by acting with speed and empathy and acknowledge failures in service delivery, while laying out a clear charter for service resolution and continuous improvement. 

Start the new year armed with key insights to tackle new opportunities. Talk to us to find out how our industry specialists can help you anticipate next steps and improve performance in the year ahead.