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The policy agenda for data

Posted By Andrew Sissons

18 January 2013

This is the fifth and final piece in a series of blogs that provide an introduction to data, and consider its uses and its impact on the economy. You can read yesterday’s piece here.

It is clear from the previous four pieces that data offers huge opportunities to businesses and to the economy, but that there are some significant barriers to taking advantage of it. If we are to maximise the benefits from all of this data, and use it to create jobs and prosperity, we need a set of rules and policies that make best use of it.

There are three particular issues that stand out for policy makers concerned with data:

  • Digital infrastructure – making full use of data depends on building effective and reliable digital networks. Part of this challenge is about securing investment in broadband cables, in wireless networks (such as 4G), in storage capacity. Part of it is about making sure that different parts of the infrastructure network are compatible; that includes coordinating the electromagnetic spectrum, ensuring hardware and software are compatible, and making networks safe and secure;
  • Skills – data techniques may mean some tasks can be done by fewer people, but those people need the right skills to use data meaningfully. Unless organisations can access these skills on a large enough scale, it will limit their ability to use big data. Equally, a failure to adapt to these skill requirements could raise structural unemployment in the UK. This presents a significant challenge to schools, universities and employers;
  • The legal and regulatory framework for data – big data is wracked by a tension between the privacy and rights of individuals and the value of data to companies. The rules around data are currently unclear and uncertain, making it hard for companies to know what they can and can’t do with data and whether these rules will change. This uncertainty makes it harder to value and trade data as an asset, and may prevent companies investing in the UK. Providing a clear, consensual framework for using and protecting data will be critical to secure the benefits of big data to the UK.

The first two of these points, about infrastructure and skills, are already reasonably well understood. Yet it is the latter point,  relating to the rules and frameworks that govern data, which receives the least attention, and it may well be the hardest to solve.

One issue that government has taken to heart is the concept of open data, in which public datasets (such as live data on train and bus locations) are released to allow entrepreneurs to develop apps and other products using them, as well as to promote transparency and accountability. Open data is a valuable concept, but it must not be confused with the wider issues around data. If government pursues an open data agenda to the exclusion of the wider policy framework around data, this could have a constraining effect on the growth potential of data.

Part of the challenge for policy makers working on data is that it is a very complex field to understand. Data comes in many forms, can be put to many uses, and often creates serious concerns about privacy and civil liberties. Separating legitimate uses of data from dangerous or immoral ones is a real and present challenge for governments.

As a result of this confusion, the partners of the Big Innovation Centre sometimes talk about a “data crunch”, in which the data they have gets locked up internally, and cannot be used for any useful purpose, let alone shared with any other organisation. Sometimes these issues are created by a morass of legal restrictions; at other times they are a result of a lack of skills or infrastructure to handle the data safely.

Unfortunately, the tension between different levels of government – particularly the EU and the UK government – complicate this policy picture, particularly in relation to the legal and regulatory framework for data. In some cases, the UK may not yield sufficient influence within the EU to secure the right data policies. In these cases, other action such as changing enforcement regimes, or providing advice to businesses on how complex rules work, may help mitigate such effects.

So what, if anything, can policy makers do to get around these problems? The key is about clarity, on what can and cannot be done with data. When there are so many laws and regulations covering the use of data, it can be impossible for firms, especially smaller ones, to know what they are allowed to do with data. The end result, more often than not, is that the data remains unused and locked away, prevented from creating jobs and economic benefits.

Rather than write and re-write confusing laws, it would be far more sensible for government to work with businesses to clarify the rules, and help provide a streamlined framework for businesses to follow. If governments can work with businesses on particular issues, and then share the solutions to them more widely, it should be possible to make data more usable without compromising on privacy.

In other cases, it may make sense for governments to create exceptions to the rules, or safe places where companies can experiment with data without letting it out into the wider world. A big part of the challenge is that companies don’t know what they can do with the data until they’ve played around with it, and let other partners join in. If government can enable experimentation in closed environments, it may help speed up the pace of data-related innovation.

None of this is straightforward for government, and there are unlikely to be neat solutions. But policy makers must be prepared to take this issue seriously, to put weight on the economic value of data, and to work with businesses in good faith to try and make data more usable. Government is expanding its capabilities to deal with data internally, which is extremely welcome, but it must not only look internally when thinking about data. Working with businesses to make it easier to use data could be one of the most effective – and cheapest – growth policies available to the government.

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