The destruction of useful public data due to confidentiality and privacy laws is “akin to burning books” and potentially damaging for innovation, according to Productivity Commission chairman Peter Harris.
Speaking to a Committee for Economic Development of Australia event in Brisbane last week to mark the end of the Productivity Commission’s 12-month inquiry into data availability and use, Mr Harris said consumers need to be given more control over their own data in order to foster innovation.
The Productivity Commission’s draft report was released in November last year and received more than 300 submissions up until December. The final report, along with a set of recommendations, will be delivered to the Federal government this week.
Mr Harris’ wide-ranging speech gave some insight into what these recommendations will be, the difficulties in working with the private sector and consumers, and the opportunities on offer if public data is effectively opened up.
Mr Harris said the rise of data is “possibly the biggest structural shift in the economy in a generation”, but there has been little movement in public policy to address this new phenomena.
“While there’s lots of opportunity, there’s not really much action. And what action there is remains seriously uncoordinated,” he said.
Building trust with consumers to encourage them to offer up and exchange their own data is the “base of innovative change” in Australia.
“As innovators, we in the public sector have been poorly served by our current regulation and practice impeding data analytics.
“Allowing innovators to create new products from previously unreleased data will probably see as many failures as it will successes, but it will be irresistible,” Mr Harris said.
While companies and consumers tend to believe large amounts of data should be “private and untouchable,” many essential government services would cease to function without access to that data, Mr Harris said.
“Data is the thing that ties our future national welfare together. Today, if deprived of consumer data, certainly very significant social mechanisms would collapse. To ensure continued trust, it is worth considering how we give something back, as we take ever greater and wiser advantage of what we can now find out.
“Data holds all these things together. And we are not using it to its potential,” he said.
With enormous amounts of data produced in Australia each day, the current set of laws governing confidentiality and privacy in data are “akin to burning books”, and consumer access to the data they create is “incredibly poor”.
“This despite the near-universal acceptance today that data is an asset, not a liability. And that, somewhat ironically, these same consumers supply pretty much all of it,” he said.
“I hadn’t really considered that imbalance of incentives – consumers give and give, but share so little in opportunities – until this inquiry.
“This is one area where, although no country claims to be on top of the data game, we were and remain clearly behind better practice amongst our peers.”
Mr Harris pointed to health care, where a combination of IP laws, risk aversion and aged legislation serves to lock up potentially useful data and restrict innovation.
The inquiry focused on addressing the “consumer paradox” where individuals are handing over huge amounts of data to services like Facebook and Google, but current regulation intended to protect consumers is preventing their data being used to benefit them.
“We can’t access data for health or education purposes, due to regulation intended to protect us, the sources of that data. And yet survey after survey says that we expect that this data is being used to obtain medical or educational breakthroughs,” Mr Harris said.
“The paradox creates a risk – for public sector and private sector data holders alike. There must be a tipping point, where the balance of willingness tips away from data support towards data restriction.”
The Productivity Commission’s recommendations will include a “common commitment” made by government and the private sector to “share back with consumers that data that was sourced from them, beyond simple mere compliance with data safety”.
Rights also need to be put in place for consumers that extend far beyond just privacy, he said.
“There is a complete absence of rights outside the privacy space for individuals in relation to their data. Consumers have only privacy,” Mr Harris said.
“As a consumer, you do not own your data. Some firms tell you (that you) do, but if you ask to sell it and deprive them of it, you rapidly will discover that this is a novel form of ownership.”
Mr Harris said that the inquiry found that there is little precedent around the world for public policy in this area.
“It is both refreshing and a bit threatening to recognise that there is no template for good data policy. And even worse, from our look around the world, no country claim to be on top of the data revolution,” he said.
“From our efforts we can also say that no single mental model or theoretical approach has much to offer on data or information, or any of its other near equivalents. The common view is that it is pretty important stuff and don’t mess it up.”
The Productivity Commission will deliver its final report to government this week.