Importance of open data to infrastructure planning, procurement, and delivery
It is widely accepted in infrastructure circles that the industry is a digital laggard when compared to other sectors. Yet this is not to say progress is not being made. Digitalisation of infrastructure delivery is a trend that is gathering speed. InfraTech solutions such as digital twins are increasingly being implemented during planning, construction and operation as these technologies mature and workers are educated on how to use them, ultimately improving infrastructure delivery.
Open data is another aspect of digitalisation that is gaining traction. This blog explores the importance of open data to infrastructure delivery and offers some practical steps for decisionmakers in the public and private sector to implement and utilise open data.
What is open data and what does it mean for government procurement?
‘Open data’ means data that is available in a convenient and modifiable form that can be freely used, reused, and redistributed by anyone. Structured, standardised, and machine-readable open data is important because it enables interoperability. This is where different and diverse systems and organisations can easily work together.
Many governments have adopted open data approaches, methodologies, and tools so that it is more transparent and accountable. Globally, public procurement spending reaches USD13 trillion annually. The scale of that expenditure means that transparency in public procurement is vital and all relevant information across the entire procurement cycle should be disclosed. However, public contracts that are published openly account for only USD363 billion or 2.8% of the total market’s value. This lack of transparency makes it difficult to understand how public money is being spent, for whom and for what purpose.
Inefficiency linked to lack of data transparency
An estimated USD97 trillion in infrastructure investment is needed between now and 2040 to meet the United Nations Sustainable Development Goals, but investments are forecast to fall short by USD18 trillion. Furthermore, the International Monetary Fund states that, on average, 33% of a project’s budget merely covers inefficiencies in the delivery process. A separate report by the Inter-American Development Bank found that cost overruns account for 28% of the total infrastructure investment cost. A large part of these losses can be attributed to the lack of transparency and poor disclosure of data and information which in turn impedes efficiency and coordination.
A way forward
Public infrastructure projects are characterised by large sums of money, protracted timeframes, and complex supply chains; often with fragmented and siloed information scattered in multiple different systems, locations, and formats.
Source: Open Contracting Partnerships
All of this impedes investment, competition, coordination, management, and monitoring; which in turn increases the risk of losses from inefficiency, mismanagement, or corruption. Better data and more of it, published in a timely fashion across the entire infrastructure lifecycle, is needed to ensure infrastructure delivers for the economy, environment, and society. Data standards like the Open Contracting for Infrastructure Data Standard and the Open Contracting Data Standard can help us to make sense of infrastructure projects and contracts, transforming processes into open data that is standardised, machine-readable, and interoperable.
Examples of how open data has improved infrastructure delivery
Below are three examples on how using open data innovations and approaches helped to secure better infrastructure delivery.
- At a whole of government level (not just infrastructure), the Republic of Korea’s KONEPS e-procurement system provides an example of the time and cost efficiencies that open data can create. Implementation of KONEPS has rapidly reduced bid processing time from 30 hours to just two. It has also saved the government an estimated USD1.4 billion and businesses approximately USD6.6 billion in costs since it was introduced in 2002.
- Through their disclosure of infrastructure projects and contracts data on the Infrastructure Abierta platform, the Government of Nuevo Leon in Mexico identified significant competition and monitoring gains There has been a 25% increase in the number of bidders due to the aggregation of information for prospective tenderers. This led to improved tendering outcomes, including reducing the occurrences of corruption in procurement. Its success has seen the Federal Mexican Government seek to replicate the platform across the country.
Source: Open Contracting Partnerships
- The City of Buenos Aires in Argentina has developed a similar platform and realised similar results. Their BA Obras platform has improved inter-departmental communication, reducing the time taken to collect and share information by 93%. This has broken down silos between departments, enabling better decision-making, better reporting on infrastructure delivery, and improved stakeholder engagement, with project information now easily available to the public. Other cities across the Americas are looking to replicate the BA Obras platform to improve their infrastructure delivery.
Next steps towards open data
Investments in infrastructure remain critical for economic development and growth, as well as addressing key challenges of inclusion, resilience and responding to climate change. Yet to answer these challenges we need to make the most out of every project. As shown in the examples above, open data and goal-driven participatory procurement practices leads to better outcomes in infrastructure projects. It can also develop coordinated infrastructure project pipelines and enable more transparency and efficiency in communicating project information to the infrastructure ecosystem. Increasing transparency through the process of open data and participation will help create and deliver more sustainable infrastructure projects for business, government, and societies around the world.