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Don’s Blog: Policy for the digital economy

As I referred to in my last blog, September/October is policy season in the Netherlands, a time when different policymakers present holistic policy agendas for the coming year to the public via His Majesty King Willem-Alexander’s annual speech to members of the government and legislature. Even though this years’ agenda is quite balanced and addresses many societal challenges, it lacks attention for the digital world that is of increasing importance to citizens and organizations. No mention of technology, no mention of the digital economy. Okay, to be fair, cybersecurity got a footnote…

Perhaps my expectations are too high, as I live and breathe technology day in day out, and am surrounded by people in similar circumstances. Alternatively, policymakers, somewhat sequestered from the practicalities of the field, may not yet see the change that has happened around them. It is, however, a source of concern for me personally if the government of one of the most digitally developed economies has no eye for the risks or potential that the digital economy has to offer.

The situation has made clear that there is a lot of work required to enhance the knowledge level at policymaking institutions. Because both innovation and digitization can bring enormous potential to any society, it usually also challenges the status quo of policies and regulations, and requires careful assessment by policymakers and regulators, together with the market. An absence of action will not cause risks to diminish, and will only serve to hamper positive potential. As this all may seem very abstract, let me give two examples: phishing and address verification.

Phishing is an upcoming art, practiced by criminals who want to obtain the login details of your bank account or other online service providers and platforms. This is something that puts an increasing strain on digital services in general and is a threat to security and trust in online services, including those offered by the government. Now, policymakers leave it mostly to the market to counter this threat, whilst solving this ecosystem issue actually requires a concerted effort of all online actors, including the government. This is especially relevant as information dissemination and education amongst citizens will have to play a large role in the solution.

If we look at address verification, a lack of government services is forcing citizens to validate their address by sending a copy of a bank statement – nowadays a print screen of online banking – to any provider that needs to have their address validated. This method is in any case prone to fraud and is really not a proper way of working given the other methods available. There should be one party, for instance, a municipal government with their central database, that guards correct address data and makes that available on behalf of the citizens, should they be required to validate or authenticate that kind of data with a third party. This kind of data services is becoming ever more commonplace, but the Dutch government is lagging behind, as are many other European states.

Both topics require proper data infrastructure and a clear policy to set the standard and improve cooperation between market participants. This is not about innovation for the sake of innovation, but it is required to keep consumers safe in this new environment, that has evermore impact on their life, wellbeing, and prosperity – not to mention making sure society actually benefits from the potential new technologies and solutions have to offer to tackle some of its current challenges. It doesn’t have to be hard: some counties are taking a really practical approach to these challenges and opportunities, like Estonia and Lithuania.

I hope this blog helps you get a better understanding of developments in technology and how stakeholders can re-shape their role to mitigate associated risks and reap benefits. Please provide feedback or let me know if you want to learn more about our insights and views.

Please let me know what you think!

All the best!

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