SMART technologies and municipal finances
The report entitled “The impact of SMART technologies in the municipal budget: increased revenue and reduced expenses for better public services” shows how cities can use SMART technologies to cope with budgetary restraints and find innovative sources of revenues to reinforce their investment capacities and offer better services to their citizens.
The report, publish by the Uraía Platform, tries to assess in a very practical way, the state of the art regarding how local governments around the world have been using SMART technologies to improve municipal management and services and how these initiatives could have a positive direct or indirect impact on the municipal finances either by increasing revenue or reducing expenses.
It analyzes trends and opportunities regarding existing technological solutions, available to cities today, and also risks, challenges and lessons learned. Each chapter comprises city case studies, as well as interviews with key actors, and concludes with recommendations about the elements that enable the success of SMART initiatives.
- Chapter 1 – Digital government. SMART solutions to: a) optimize municipal management such as management platforms and online services to citizens; b) encourage smarter payment systems such as e-procurement and Mobile money; and c) increase revenue through better tax collection and administration as well as local economic development promotion.
- Chapter 2 – Transparency and citizen participation. SMART solutions that may strengthen the trust of citizens in the local government, and on the long run, lead to an increase in tax revenues; as well as other tools that may help fight corruption and fraud and reduce financial losses due to the misuse of resources.
- Chapter 3 – Energy efficiency of municipal assets. SMART technologies applied to energy management in cities, and to reduce the municipal energy bill. It covers topics such as street lighting, building efficiency and SMART grid technologies.
- Chapter 4 – Efficiency of public services and infrastructure. SMART solutions to improve cost-efficiency in the management of three main municipal services: transportation, waste and water. Initiatives such as SMART parking, SMART cards, intelligent waste collection, and sensors network to detect water leakages are addressed and have proved to generate savings for local governments around the world.
The Uraía Platform uses the expression SMART technologies in capital letters because SMART doesn’t refer only to the ICT technologies but also to a specific approach regarding their use by local governments in public management to build sustainable, resilient and liveable cities. Traditionally, the S.M.A.R.T. goals are criteria used in public and private management. When applied to the innovation in municipal management, it means “Sustainable – Measurable – Actionable – Realistic – Transparent”.
The report provides general recommendations on how to ensure the success of a SMART project:
PREPARATION – Developing and maintaining SMART technology projects can be costly both financially and in terms of human resources. Thus, local governments must follow a few preparation steps to make sure they want to initiate SMART projects, including:
1. To choose the technology and projects according to the city’s vision.
2. To choose the technology according to the municipality’s capacities.
3. To strengthen institutional capacities and invest in skilled human resources.
4. To provide political leadership.
5. To start with pilot projects in small areas.
6. To define a clear and flexible legal and regulatory framework.
7. To ensure data privacy and cybersecurity.
8. To carry out the necessary studies.
9. To ensure systems interoperability and avoid isolated initiatives.
COLLABORATION – SMART projects are usually transversal and involve a variety of stakeholders, which means that cooperation is key to ensure their success. Local governments can:
10. To cooperate with national government and association of cities.
11. To ensure dialogue and coordination with multiple stakeholders.
12. To guarantee integration between city departments.
ENCOURAGING USE – SMART projects are only successful if they are used, but local governments often face difficulties to recruit participants. This may be due to difficult access to SMART technologies combined with cultural and literacy barriers, but also highly educated people may not be familiar with the latest technologies and may refuse to participate. Sometimes, part of the population may lack of time and interest to participate in such activities. Some of the actions that local governments can undertake to maximize citizen participation in SMART initiatives are:
13. To conduct strong on-going communication and sensitization campaigns.
14. To establish incentives.
15. To combine traditional and online solutions.
- Download the report “The impact of SMART technologies in the municipal budget: increased revenue and reduced expenses for better public services”