The digital provision of public utilities & services is a shared task

In recent years, the federal states and municipalities have launched various funding programmes to promote the digitalisation of government, administration and the public sector at all federal levels. These programmes are intended to provide incentives and, by granting financial subsidies, help reduce possible uncertainties on the part of the recipients. They are also intended to pilot various measures. Municipalities and their public utilities and service providers are important target groups in this regard.

The funding programmes mainly have short- to medium-term impacts. However, due to their time-limited nature, they usually do not allow digital solutions to be scaled up on a broader basis or the funding to be stabilised in fiscal terms. This ultimately affects all municipalities, regardless of whether they receive funding or not. This raises the question of responsibility and who can actually ensure – and in what way – that successful digital solutions are transferred and adopted on a wide scale. This also provides the context for the growing professional debate on the “digital provision of public utilities and services”. In addition to the question of what constitutes the digital provision of public utilities and services, in particular it is also a question of the extent to which the state has an obligation to guarantee the digital provision of basic utilities, what services are associated with this, and what legal and financial certainties are necessary.

The provision of public utilities and services addresses the basic needs and concerns of the population. As supply needs change over time and in line with living standards, public utilities services are also subject to change. In addition, the technological capabilities behind these services are also changing. This is particularly evident in the case of digitalisation, which now plays a central role in determining living standards. It has an enormous impact on different areas of people’s lives and is also a key driver of social development.

The digital provision of public utilities and services covers two different areas: on the one hand, digitalisation in the sense of optimising and increasing the efficiency of “traditional” core tasks and, on the other, those new tasks for providing public utilities and services that arise solely from digitalisation. With regard to existing services for providing public utilities, a wide range of activities can already be observed in the municipalities today. For example, the control and monitoring of networks and technical infrastructure systems are increasingly being carried out digitally. Sensor technology can be used to detect critical supply situations in real time, making systems more resilient. Platform offerings are also becoming increasingly important, such as for the provision of demand-led mobility. New additions are the infrastructures for collecting, transmitting, storing and processing data that have been created in the last few years or are currently being developed. These include sensors, data transmission networks, data centres and data platforms. The data generated and collected represents an enormous asset that not only forms the basis for all municipal services, but is also of considerable importance to citizens in the context of data provision. Smart city apps or digital twins create information offerings to interactively display static or dynamic city data, and data portals provide access to existing data sets, including their visualised presentation. All this is an expression of the right to digital participation

However, a number of issues need to be clarified before the digital provision of public utilities and services can be fully implemented:

Municipalities should define for themselves what they consider to be the digital provision of public utilities and services. They should know what this means for existing service areas and where new structures may be needed. In future, municipal data platforms will provide the basic infrastructure for the digital city.

This involves integrating data from different sources (specialised procedures, GIS, sensor technology, etc.) or connecting to already existing data platforms. It also includes the integration of data from different municipalities as part of inter-municipal data exchange. From now on, data infrastructures will form another pillar in the municipal provision of public utilities and services, comparable to the water and energy supply networks and systems. From an organisational point of view, these infrastructures can be operated analogous to other areas through the municipal administration, municipal enterprises, collaborations with private partners or inter-municipal cooperation.

For municipal enterprises, the digital provision of public utilities and services represents a necessary evolution of their business models. In future, digital technologies, the use of data and algorithms as well as AI-supported automation will play an even greater role in offering and delivering services – and thus in generating revenue – than they do today. The focus will be on data-driven and platform-based business models. It will be important that the mix of digital offerings is economically viable.

The federal states should therefore examine which digital tasks can be transferred to the municipalities as mandatory tasks in order to create legal and financial security. As most public utilities and services will be provided digitally by municipal enterprises, the federal states should examine the municipal business law in the municipal codes to see whether it offers sufficient scope for municipal economic activity and innovation in the dynamic market for digital services. Municipal enterprises need a clear framework. A third area concerns the provision of digital solutions by the federal states themselves. Although digital agencies provide a wide range of information and advice to support municipalities in developing the digital provision of public utilities and services, implementation issues arise when municipalities negotiate with providers of digital solutions but would prefer a standardised, nationwide solution rather than having to rely on third-party operating software.

In addition, it should be examined at the federal government level as to whether the digital provision of public utilities and services can be enshrined in the Basic Law as a joint task, so that the federal government and the federal states can share the costs of bindingly defined subtasks for digitalisation on a permanent basis. Such a joint task could be directed equally at the municipalities and their municipally owned corporations in order to help initialise a strategy with measures for using and networking digital infrastructures and processes within the “municipal corporate group”. The joint task could take into account the general consensus in society that digitalisation should be promoted as widely and strategically as possible by municipalities as part of their provision of public utilities and services. The hurdles for a necessary amendment of the Basic Law are high, but the digital provision of public utilities and services is too important for its funding to always be subsidised selectively and unsystematically.

Clarification of these issues and action at all levels are urgently needed. Germany is lagging behind internationally when it comes to ensuring comprehensive digital services and participation. There is a huge need for investment, which is all the more important given the growing shortage of skilled workers. Only through comprehensive digitalisation, including the use of AI, will it be possible to provide public utilities services on a comparable scale in future

Vorabveröffentlichung aus dem Difu-Magazin Berichte 4/2024