Government commits to smart data – but no timeline yet

There are two potentially far-reaching and visionary promises in the BEIS response on smart data, which, if reflected in the detail which results from the National Data Strategy, could put the UK on a footing to emerge as a true connected digital economy for services. These are:

• the promise of primary legislation whereby companies would be mandated to participate in smart data;
• the establishment of a cross-governmental/regulatory working group to coordinate and accelerate smart data initiatives.

However, there is a clear lacuna in the Response: any real consideration of the pivotal role digital identity must play in such an economy.

The promises

Primary legislation to ‘make it possible to mandate industry involvement in Smart Data initiatives’ will be introduced ‘when Parliamentary time allows’. The idea that such involvement would be mandatory is quite a striking one, acknowledging that, as was the case with open banking, such major shifts in businesses practices do not easily happen unless they are compulsory.

The huge strides in open banking, the resulting fintech boom and the plethora of new services for consumers and SMEs has been the direct result of the Competition and Market Authority order of 2017, which went further than the PSD 2 and has enabled a set of secure, trustworthy APIs to be developed via a cross-industry cooperative body, the Open Bnking Implementation Entity (OBIE).  The response acknowledges that a number of companies advocated voluntary participation, but the majority view was that a mandate was required.

Initially, the communications sector will be opened up, to help consumers navigate complex and confusing non-price information such as speed and customer services. Thereafter, crucially, the primary legislation will make it possible to extend smart data to other sectors such as retail and transport. This, we trust, signals an intention to look at the whole of the economy as, potentially, beneficiaries of smart data principles.

However, there is no timeline as yet, which may simply be because time has not yet been allocated in the Parliamentary timetable for next year. We urge government to give this issue priority as it heralds a real beginning for the joined up digital economy we will need to bring the real benefits of new technology to citizens and to help us out of the economic crisis following Covid-19.

The Smart Data Working Group

The response also promises that we won’t have to wait entirely for the primary legislation. In the meantime, a working group will examine the detail of how smart data can be achieved, given that there are highly specific requirements for different sectors. This group is to be made up of an encouraging list of bodies: BEIS, DCMS, HMT, DWP, Ofgem, the FCA, the CMA and the UK Regulators Network, with the ICO as observer.  It will focus initially on open finance, energy and open communications and it's key terms of reference are:

• to support the development of infrastructure and standards;
• encourage consistency, interoperability and cross-sectoral innovation
• and reduce duplication. This may indicate learning from the experiences of open payments and banking.

It’s task is to produce, by Spring 2021:

• Recommendations for smart data with tangible innovations
• Guidance for existing data portability initiatives – avoiding duplication
• Recommendations for where smart data can be standardized in different sectors – e.g. accreditation and authentication

The working group will engage with experts (e.g. BofE, Centre for data ethics, OBIE), industry and consumer bodies. techUK stands ready to work with this group and facilitate the establishment of open data as swiftly as feasible.

A further highly welcome element of the Response is the coordination of the smart data working group with the CMA’s Digital Market’s Taskforce, established further to the Furman review.

Missing Element

The one noticeable gap in the Response is the lack of linkage with digital Identity. The only mention is in paragraph 28, which notes some respondents’ view that the further sharing of public data such as DVLA or passport office data would be very useful in verifying identity for online services.  There is no discussion, however, of the role digital identity should play in smart data.

As techUK has pointed out in its White Paper, digital identity must be a key part of the digital economy. The two must go hand in hand, as digital identities are essential to ensure security and privacy for citizens who make use of smart data, while also enhancing the connectivity of that data across sectors.

Are you a techUK member interested in this topic? We will shortly be issuing a call for interest in a new Working Group on Smart Data, so do get in touch!