Australia’s digital future: Evolving the Consumer Data Right
Good afternoon. I’m so pleased to be able to join you today to talk about our digital future, and in particular the pivotal role the Consumer Data Right will come to occupy; both for individual consumers, and the businesses that serve them.
The Morrison Government has set a goal and is unrolling a plan for Australia to be a top 10 digital economy and society by 2030.
A top 10 digital economy and society means;
More choice for consumers, and competition to provide those choices. Very traditional Liberal principals - but driven by modern digitally enabled insights and analytics.
It means agile businesses that respond to consumers in a timely way and adapt to their needs.
In a top 10 digital economy and society Australian skills, innovation and creativity result in product offerings and job opportunities we haven’t even conceived of today.
And most importantly for the next generation, a genuine digital economy and society has at it heart safety, security, and reflects our national values.
My message to businesses is that the best time to digitise was two years ago. The second best time is right now.
And the prize for an economy that leans in to digital transformation is enormous, but it does not and will not happen by accident.
That’s why the Morrison Government’s Digital Economy Strategy, announced in May 2021, is a living strategy that will evolve over time, just as technology itself evolves.
The Morrison Government has already made significant investments in Australia’s digital future. Things like:
getting those foundational pillars in place; skills development through the $1 billion JobTrainer fund, the $4.5billion NBN upgrade, 5G & 6G readiness, our $1.67 billion cyber security strategy, the New Payments Platform that facilitates real time payments and, most importantly, the CDR
We’re driving the development and uptake of high value emerging technologies like AI, Quantum, IoT, Blockchain and data analytics
And we’re getting the settings right and cutting red tape to encourage private sector uptake.
We’re also pursuing initiatives like:
the Australian Data Strategy, which unlocks government held data for powerful new use cases
the Digital Government Strategy, which includes a commitment for every single Government service to be available online by 2025
Modernising Australia’s payment system to capitalise on new payment and blockchain technologies and examine the feasibility of a central bank digital currency
launching the National Artificial Intelligence Centre with CSIRO’s Data61 as part of our AI Action Plan which cements Australia’s position as a world leader in AI research and development; and
expanding the Consumer Data Right - Australia’s world leading data portability system - across the economy.
Within government, we’re practicing what we preach. Already 6 million Australians have taken up a Digital Identity, which will be the catalyst to so many more safe, secure and verified digital exchanges. Think of opening bank accounts, buying a home, renting a home, submitting a tax return, starting a business, applying for welfare, getting married, losing a loved one, applying for licences - everything from driving to fishing. Anything you need to be able to verify your identity for. It’s secure, it’s convenient and it will soon be ubiquitous.
Our prosperity depends on Australians being empowered to build the businesses of the future, and grow them here in Australia – it’s those businesses that will create highly paid jobs and allow our living standards to be maintained and improved.
All of this job creation, service improvement, improvement in living standards and innovation hinges on one factor though, above all others: data.
Data is to the digital revolution what oil was to the industrial: an essential, a commodity, a security issue and an opportunity.
Digital technology is clearly creating, and making it easier to use, large amounts of data.
Someone has to be accountable for that data. To set the standards. To protect it. To grasp the opportunity provided by it.
And that’s why I want to spend most of my time with you today discussing the Consumer Data Right - over time, something that is likely to drive changes as far reaching to the Australian economy as floating the dollar.
The Morrison Government believes that consumers should be at the very centre of the data paradigm.
That’s why we have established the Consumer Data Right - a world leading, whole of economy approach to data, standardising protections, promoting interoperability, and simplifying service provision. It is the infrastructure, or pipes for the safe and secure sharing of data as directed by the consumers it is created or collected from.
The CDR gives consumers and businesses the capacity to tap into and use their own data in a way that was either impossible, overly complex or fraught with privacy and security issues in the past.
Data can be difficult to access, hard to make sense of and complex to use. Anyone who has ever tried to compare their actual banking, insurance, superannuation or utilities data to other product offerings can attest, it has not been a simple, seamless or accessible process.
There have been some offerings to band-aid over this need. Many of us may have agreed to a practice known as screen-scraping, or have felt the need to share passwords - an obvious online safety risk- and the consumer has less control over what, how and when data is used. Significantly, audit and deletion rights do not realistically exist in this model.
Price comparison services have existed for a while. And don’t get me wrong, some of them are terrific. But they’re often not personalised, and as a result not comparing apples with apples.
And creative product bundling? Comparison systems in their current form simply can’t offer a level of personalisation or granularity that customers desire and deserve.
The CDR will change this. It will make a very tailored, personalised, specific comparison easy, and safe.
CDR, in its essence, shifts the balance of power from the businesses who accumulate and hold our data back to consumers whose actions generate it.
Your data. Your right. Your benefit.
That’s a big change and it will take time before we’ve fully exploited the power of that shift.
But it’s begun. We’ve started with banking. Open Banking is up and running – and I want to thank those banks and financial services who have worked tirelessly along side government to deliver these benefits to their customers.
Next will be energy and telecommunications which will safely add to the richness of the data available to individuals about how they spend, consume and go about their daily lives.
Most recently I announced the move into ‘open finance’, leveraging the successes in Open Banking. Benefits for consumers have the potential to extend across industry verticals. It’s not just about in sector product comparison anymore, it’s about having the ability to optimise your life or your business based on your actual data and insights drawn from an increasing number of datasets.
Businesses, you in this room today, I’m pleased to say, are on the journey with us. The evolution of CDR has been a genuine partnership with business, peak bodies and consumer groups. Once again, let me thank you to all for your participation in the process. The CDR may be a Morrison Government initiative – indeed by its complex and comprehensive nature it must be government led. But it is the foresight and fortitude of the private sector that will make the consumer benefits a reality.
Over the next few years, we will grow the CDR in the sectors I’ve mentioned but also in other ways that will deliver value to consumers. By connecting datasets that extend to the broader finance sector – open finance and beyond.
For instance, eventually the dashboard on my phone will give me the right insight to switch power providers, show me how to finance installation if I opt for rooftop solar power, and how to insure it. All based on my usage, my preferences, my data.
It will be seamless, and cost efficient for consumers and business alike.
Key to further growing the CDR is reducing hassle and enabling flexibility. For example, allowing consumers to safely share their data with more third parties in ways that suit them. That means accountants, lawyers, financial advisers and other professionals can become part of the system, add their expertise to data analysis and decision-making and enhance the client-experience.
For smaller companies or start-ups, we are accrediting participants who can provide Prêt-à-Porter CDR style solutions to speed the process of aligning IT systems and meeting accreditation requirements.
Uptake matters. Flexibility and encouraging voluntary entry into the CDR market is the fuel to igniting innovation. To let a thousand flowers bloom, we need more seeds in the ground in the form of small business uptake.
And, as with all new paradigms, besides the immediate benefit to current businesses, the creation of the CDR has acted as an incubator for the creation of a whole range of reg-tech businesses - companies that are in-the-business of reducing the cost and burden for data holders to meet their obligations and leaving more time for data holders to seize the innovation opportunities it offers.
We are seeing the switch from compliance to innovation happening already with several, such as the CBA, NAB, Regional Australia Bank and the Police & Nurses Limited, becoming accredited. I’m so excited to see more businesses added to that list all the time.
We’re seeing the majors invest in start-up business to supplement their operations like CBA taking a 20 per cent stake in business payment facilitator Paypa Plane.
There is already a strong flow of CDR data in the banking sector where consumers can use their personal data to switch banks, take out a loan, apply for a new mortgage or add new financial management tools like budgeting apps to their armoury.
As the CDR expands from banking into related financial fields, including general insurance, superannuation and the broader lending sector, there will be a substantial change to the way consumers can use their existing data to make better choices about the financial services they engage.
But where to next?
The Inquiry into Future Directions for the Consumer Data Right made 100 recommendations to expand the functionality of the CDR beyond any comparable data portability framework in the world. We’re taking steps to implement 94 of those recommendations. Each one will enhance the utility or increase the security of the CDR in action.
Particularly noteworthy are the reforms that will expand CDR beyond a consumer data access regime to a regime that enables consumers to instruct trusted and accredited third parties to take actions on their behalf. An active, rather than passive scheme. As we all know, it’s one thing to use your data to find a better product or service, it’s another to take all the steps to sign-up to a new provider. Imagine how much less sticky say, banking products might be, if you could switch all of your direct debits when changing banks with the touch of a button.
There is no denying that, as with any new system, there was an intense upfront build phase to put the rules, guardrails and processes into place before the benefits of the new way of working are adopted by the marketplace and felt by consumers.
But now, as we move into 2022-23, consumers will begin to see real and tangible benefits in ease of comparing products and switching.
They may not be aware that, by using their banking data in a savings budgeting app, or by spreading their bill payments more evenly, they are using the Consumer Data Right, a key new piece of data infrastructure whose creation was initiated by the Morrison Government. For younger consumers it will simply be the way things are done.
As the build phase shifts to a user-driven phase, the consumer-centric design of the CDR and, indeed, the digital economy will be fully realised. It will put Australia among the best in the world in data management and standards.
As such, it’s a key part of the Morrison Government’s economic plan, contributing to Australian society becoming more financially capable and helping empower individuals, families and businesses to build and manage their own finances.
It’s a key part of the Morrison government’s ambition to enable a dynamic, innovative and adaptable economy – a true legacy for decades to come. A top 10 digital economy and society isn’t just about bragging rights. It’s about this generation and the generations to follow;
living in a stronger, more resilient and more diverse economy,
full of interesting, better and higher paying jobs,
with a better and easier life,
and the choices and chances we expect and deserve.
I couldn’t be prouder to be part of this transformation and I couldn’t be more excited for what lies ahead.