Prime Minister Malcolm Turnbull personally asked the Digital Transformation Agency to investigate the potential to provide government services on the blockchain, with welfare payments the first to be tested.
This month’s federal budget reallocated $700,000 of DTA funding to go towards researching the benefits of using the blockchain for government services.
At a senate estimates hearing on Monday night, it was revealed that this was the result of a request from the Prime Minister for the DTA look into the matter.
“This came about from a number of conversations with ministers and officers that a number of agencies had commenced looking at blockchain, including ASIC and home affairs, as well as lots of vendors,” DTA chief operating officer Peter Alexander said at the hearing.
“The Prime Minister in fact wrote to our minister and asked us to have a look at blockchain, which evolved into this piece of work,” he said.
The funding figure provided to the DTA has raised some questions, with Labor senator Jenny McAllister pointing out that it is a “very round number”.
Mr Alexander said the amount would go entirely towards the staff members working on the project.
“We actually costed that with the application of the team staff, and we’re absorbing that funding. We were doing some work on it, we have a team that will do that and we costed the staff effort,” he said.
The DTA will research the current maturity of blockchain technology, the readiness for government to adopt the technology, and the problems it may solve.
“The task is pulling together the experience across government in blockchain to say fundamentally what it is and if there is a value to this technology and approach,” Mr Alexander.
“At a time when blockchain is new and not standardised, and clearly has some values outside of cryptocurrency, we will look at it and determine what the value is and how we can use it,” he said.
The DTA was also asked to develop a possible solution for providing welfare payments on the blockchain, Mr Alexander confirmed at the hearing.
Then acting DTA chief executive Randall Brugeaud revealed late last week at a conference in Sydney that the agency would investigate the “potential of blockchain to securely record” Centrelink transactions.
“Our plan is to look for use cases across the government, with an initial focus on the welfare payments system. Then, working with our digital services standard, we’ll conduct user research with a view to having a prototype by the end of next financial year,” Mr Brugeaud said.
At senate estimates, Mr Alexander said that other areas where blockchain could be applied are for the settlement of trades, cargo management and ensuring the accuracy of open data sets.
“Some of these things are using technology and approaches from the 70s,” he said.
Shadow minister for the digital economy Ed Husic welcomed the funding for the blockchain project, but said he was concerned that it was not enough money to properly investigate the issues.
“A few months ago I spoke about the need for the DTA to be the central point of thinking around blockchain in government, and it’s great to see this budget has picked up this suggestion,” Mr Husic told InnovationAus.com last week.
“But I noticed some concern by people in the sector questioning whether the $700,000 allocation is enough. We’ll keep talking with people, but it’s a start.”