DTA to scrutinise blockchain’s potential for government payments

Budget documents reveal DTA to spend $700,000 on investigating blockchain

Budget documents reveal that the government’s Digital Transformation Agency will “investigate areas where blockchain technology could offer the most value for Government services”.

The government said that the $700,000 cost associated with the program would be met from within the DTA’s existing resources.

The CSIRO’s Data61 in 2017 released a research report on the potential of blockchain-style technologies, which argued it could potentially be used to improve government service delivery. Private blockchains “could be used to facilitate information sharing and process coordination across agencies within government.”

Globally, there were four key categories of blockchain application being examined by governments, the report said.

One was registries and identity, another was quota management, a third was taxation and a fourth was grants and social security.

Smart contracts “could automate the process coordination to apply for, decide on, and distribute payments for grants and social security,” states the Data61 report, Risks and Opportunities for Systems Using Blockchain and Smart Contracts.

“With a sufficiently-sophisticated payment environment, a smart contract could automatically limit payments to approved suppliers or categories of expenses,” the report adds.

A recent survey conducted by global analyst firm Gartner found that despite the hype around blockchain and distributed ledger technology (DLT) fewer than 1 per cent of chief information officers have invested in or deployed any kind of blockchain-based solution within their organisations.

The survey of 3138 CIOs found that DLT systems in production were almost non-existent, although Gartner report that 8 per cent of IT chiefs had indicated they were engaged in pilots.

Australia, however, is home to one of the more advanced efforts to build an enterprise-grade DLT-based system: ASX, which operates the Australian Securities Exchange, is preparing to role out a DLT system to replace its Clearing House Electronic Subregister System (or CHESS). The system delivers clearing, settlement and other post-trade services for the ASX.

The exchange operator revealed last month that it plans to have the CHESS replacement in production sometime between the final quarter of 2020 and the first quarter of calendar 2021.

It will begin releasing software testing tools from Q2 2019, which will be followed by migration testing in June 2020. ASX has said that in July 2018 it will publish an update on timing of the rollout.

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Tags governmentASXBlockchaindistributed ledger technologyDigital Transformation Agency (DTA)Budget 2018

More about AustraliaAustralian Securities ExchangeCSIRODLTGartnerSmart

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