United Nations Public Service Awards Case Studies

Introduction
The Tax Agent Portal (TAP or ‘portal’), demonstrates how an organisation adapts and responds to improve service delivery. Based on a desire to be transparent and open, the Australian Taxation Office (ATO) opened appropriate client records and ATO systems to the tax agent community.
In Australia, registered tax agents are pivotal to the integrity of the tax system. Registered tax agents are persons registered to act on behalf of a taxpayer, and who charge a fee for this service. The majority of Australians, either as individuals or as a business operator, use tax agents to manage their tax affairs. Tax agents therefore have direct influence on the compliance behaviour of taxpayers.
A high percentage of people use a tax agent, with latest figures at August 2007 indicating around 21,000 active registered tax agents lodge 73% of the 11.5 million income tax returns for individuals and over 95% of returns for business.
A dedicated electronic portal for tax agents provided a range of services, including online products, services, tools and information relating to the tax system. Today, over 62 per cent of surveyed tax agents indicate the portal is their most frequently used and preferred means of interacting with the ATO. Their ability to see client records developed a basis for renewed trust and shared accountability.

Business Problem
In July 2000 the Australia Government commenced the largest reform to Australia’s taxation system since Federation, introducing a value added tax of 10% on a broad base of goods and services. This generational change of the Australian taxation system also encompassed changes to personal income tax rates and thresholds, and a restructure of the business taxation regime including the introduction of a Business Activity Statement (BAS) which integrated all of the various business taxes into one return. It also changed how the Federal Government provided funding to the next tier of government known as a State or Territory.
All taxpayers were impacted by this massive change, however for the tax agent community this manifested in a more dramatic way due to additional lodgment and reporting requirements. The New Tax System (NTS) meant more individuals and businesses were seeking the assistance of tax agents to manage their tax affairs.
While the ATO had taken steps to meet the increased demand through more call centre staff and streamlining calls based on their complexity, this was insufficient. Tax agents needed to make many more calls to satisfy even the simplest check of client details and from an administration perspective the ATO knew that putting on more call centre staff was not efficient, effective or sustainable. The relationship between tax agents and the ATO became increasingly strained and reached a public breaking point in August 2002 when one of the accounting associations, through an ‘open letter’ to several newspapers, presented the ATO with a 10-week deadline to improve services and support or risk facing an ‘electronic go slow’ where members would be encouraged to revert to paper for lodgments and requests for information.

What is the initiative about? (the solution)
Benefits The achievements from the TAP initiative need to be assessed from both the tax agent and ATO perspective. While in 2002 the introduction of online self-help, particularly to others in the tax ‘industry’ would have been viewed as revolutionary, the iterative nature of the implementation provided more far reaching benefits for the ATO in terms of how the ATO works and how it meets its business outcomes. Generally, tax agents now have 24 hours per day, 7 days per week availability and access to information to meet their clients’ needs. Coupled with a secure messaging facility for electronic correspondence, this provides greater choice in when to access information and when to interact with the ATO. Recent research shows 95% of tax agents indicated the portal was amongst their three most frequently used communication channels, and 81% say they access the portal on a daily basis. The introduction of real-time processing has provided tax agents with certainty of outcome and improved data quality. Tax agents can identify incorrect data and correct it online. In addition, reduced manual handling results in less human error, particularly with front-end data validation checks. As tax agent and ATO staff can view the same information, this also greatly increases communication and understanding. To engender a greater level of confidence and trust in the tax system, the ATO has continually exposed more information about the ATO approaches to clients (e.g. Compliance Plan). The TAP is consistent with this approach and promotes self-governance in relation to compliance activities. By directly viewing client information, tax agents can quickly ascertain if lodgments or payments are outstanding. The TAP also makes it easier for tax agents to manage their clients’ tax affairs through uploading pre-filled reports. Cost savings are also being realised for the ATO. The reduction in calls to the ATO Call Centres means that resources can be used to deal with more complex queries, or redirected to compliance activities. From a technology perspective the TAP provided the platform for the Business Portal launched in March 2004 and for the Bookkeepers’ Portal implemented in October 2007. Reuse of common modules such as displaying client account details or transaction processing shortens the development timeframes and ensures consistency of experience/outcome. How the Impact is measured To date the ATO has used a range of information, both qualitative and quantitative, to measure user satisfaction levels, value for money and improvements in public service capability. These include surveys; usage reports; and tracking the impact against other channels. Longitudinal studies have also been conducted by the ATO since 2003. Improvements to service delivery are reported through the annual release of Making it easier to comply booklet which is the ATO ‘contract’ with the community. It outlines to the Australian community how changes may impact, progress to date, and what will be delivered in the coming year. In line with the strengthening of the ATO’s relationship with tax agents, the ATO also established consultative committees to ensure that feedback is continually provided from the user perspective.

Who proposed the solution, who implemented it and who were the stakeholders?
Stakeholder Engagement The notion of a TAP did not occur in isolation but as part of the broader strategic direction of the ATO to consult with key stakeholders. As part of the ‘Listening to the Community’ program established in 2002, feedback from tax agents showed they wanted direct access to tax data for their clients. Further, a 2002 breakdown of the relationship and public backlash reinforced tax agents’ need for direct access to client information and became an imperative to demonstrate improved service. In the TAP context, key stakeholders included tax agents and accounting industry professional associations. In turn, the businesses and individuals who used tax agents were also interested parties and indirect stakeholders. The ATO needed to facilitate improved service delivery, as well as leverage more efficient and effective administration of the Tax System through tax agents. While the portal itself was the technology change that occurred in the TAP initiative, there were changes in other areas operating in tandem to improve ATO business and people capability. This included changes to telephony support to handle a different range of phone calls, given the simple ‘check of client details’ was now being undertaken by the tax agents themselves, as well as the development and deployment of strategic relationship management strategies. How the ATO worked to involve key stakeholders in both the design and implementation is a feature of the TAP initiative. From the beginning, a user-centred design or co-design process between tax agents (including accounting industry professional associations) and the ATO was used to deliver improved products and services. The ATO made a commitment to deliver these improvements and articulated these as improved client experiences under its Easier, Cheaper and More Personalised (ECMP) program i.e. making it easier for clients to comply with their obligations; making it cheaper by reducing the workload, time and effort to meet obligations; and making it more personalised by offering products that make sense to clients. To assist tax agents administer Australia’s revenue laws, an early priority was to develop a secure online environment. The TAP initiative was developed through utilising tax agents’ feedback and seeking to address their major irritants with the taxation system, through development of a tailored and interactive online environment. To achieve this, delivery of the TAP initiative has been through implementing gradual changes to the portal, ensuring that the functions added benefit both to the users (tax agents) and the ATO. The ultimate vision of the TAP is to become a fully integrated, electronic hub which tax agents can use to transact information and business with the Tax Office. Already we are well progressed in delivering this vision and are on track to deliver future improvements seen as important by tax agents. This includes integration of the TAP with the electronic systems tax agents use in the management of their own practices. This use of more ‘natural systems’ will require the ATO to facilitate major changes to integrate core processing systems and web technology.

Describe how and when the initiative was implemented by answering these questions
a. What were the strategies used to implement the initiative? In no more than 500 words, provide a summary of the main objectives and strategies of the initiative, how they were established and by whom.
Strategies A number of strategies have been applied during the development of the TAP. It was key that executive sponsorship was secured and this ensured that the project direction of the TAP remained consistent with the ATO’s overall organisational strategic direction and that there is a focus point for critical decisions, issues and risks. Executive support also ensures that other aspects of the TAP strategy, such as rebuilding the relationship with the tax agents, are being undertaken in tandem. As part of the ATO’s overall ‘Listening to the Community’ program launched by the Commissioner of Taxation in March 2002, the ATO worked with individuals, small business, industry and tax agents to develop ideas to make it easier and cheaper for people to comply with their tax obligations. The ATO listened to the experiences, conducted discussion groups and sat with people as they went about their daily work to get an idea of what the tax system was like for them. In addition to involving the community in the initial stages of determining requirements for improvement, the ATO also committed to the concept of user-centred design or co-design to conceive, develop and test products and services developed. This approach is applied at all stages of development from priority setting, designing the solution, testing and retesting the solution with users and finally testing the solution in their business environment before going live. The co-design process is ongoing with learnings about needs in one release feeding into the next. This strongly supports incremental improvements and a notion of evolution for the TAP product. The ‘Listening to the Community’ work also allowed for the identification of major irritants and where most value could be added in the provision of online products and services through the TAP. The basic principle of initially delivering what is most needed and then expanding functionality over time has ensured that the TAP has been widely adopted as a channel of service choice by tax agents. It also removed the angst in the relationship so work could move forward in a cooperative way. Coupled with dealing with the major irritants first is the underlying principle to deliver an initial product as quickly as possible, and then undertake incremental improvements. This eliminates the situation where delivery is delayed while waiting to develop a full or ‘perfect’ product/system. Early implementation also provides users with a sense that progress is occurring and gives them the opportunity to provide feedback on functionality in use and development of future requirements. By publishing the improvements to service delivery, and regularly reporting on progress, the ATO established a ‘contract’ with the community about how the TAP initiative would be progressed, when improvements would occur, and what results were achieved. This approach communicates clearly to the community the ATO’s intention to deliver and also assists in engendering organisational understanding of, and commitment to, the program.

b. What were the key development and implementation steps and the chronology? No more than 500 words
Chronology The development of the TAP is signposted by incremental releases to implement new or refined functions and services. While the initial TAP was available for use by all tax agents, it was still a relatively experimental product. The chronology outlined below provides touch-points to highlight the tax agent benefits previously outlined such as real time processing and Practice Management. For the ATO the benefits of reuse and pre-filling for compliance behaviour are featured, as well as implementations to address security and secure messaging challenges. Each release also provided enhancements to products and services. Release 1 – October 2002 - Initial launch of TAP with access enabled via User ID/Password. View/download a limited range of static client reports and secure messaging to the ATO for electronic lodgment (ELS) enquiries only. Releases 2 & 3 – March/April 2003 - Release 2 was a short pilot of the functionality rolled-out to all users of the TAP in Release 3. Real time viewing of client registration and account balance information. Release 4 – June 2003 – Because of the reusability of TAP function and services, the ATO piloted the Business Portal for businesses to interact directly with the ATO – the official launch was in March 2004. Two-way secure messaging (secure email like functionality) was introduced for both the TAP and Business Portal. Release 5 – September 2003 - Ability to ‘drill down’ to see details of individual postings and calculations on client accounts e.g. how the General Interest Charge (GIC) was calculated. Online Access Manager facility was introduced to enable tax agents to create separate user accounts for their employees. Release 6 – January 2004 - ‘Real time’ updates to client registration information and ‘real time’ response to requests for refunds of credit. Ability to prepare and lodge a business return while online (however processed offline). Introduction of Practice Management tools such as ‘real time’ client directory – to list, view and update of clients managed by the Practice. To provide a higher level of security digital certificates (PKI) were introduced for tax agents. Release 7 – August 2004 - ‘Real time’ lodgment of business returns. Add/update bank account and email details. Release 8 – December 2004 – Additional information for different tax types e.g. Superannuation, and Excise. Release 9 – October 2005 - Additional online forms provided with the ability to include attachments. Release 10 – July 2006 – Large scale change to other ATO systems meant that the ATO implemented a new midrange system for case and work management. Release 10 integrated the TAP with the new system to provide a more versatile correspondence channel. Tax agents have access to the same pre-filling information as Individuals using their electronic lodgment system (eTax) – limited to social welfare information in this Release. Release 11 – October 2007 – Bookkeepers Portal introduced with the reuse of TAP functions and services. Availability of pre-filled information greatly enhanced with information available from more third parties such as financial institutions for bank interest, share dividends etc.

c. What were the main obstacles encountered? How were they overcome? No more than 500 words
Challenges In line with obstacles encountered when developing an e-initiative, the key issue for the TAP project was developing confidence with the tax agent community that the portal would provide a balance between usability and security, as well as maintain the privacy of client information. The Internet presents specific security challenges. Addressing such challenges adds complexity to the security solution and can often result in a product that is less usable from a client view. The ATO currently offer two levels of authentication for the TAP - User ID/Password and Public Key Infrastructure (PKI) digital certificate security. Because the ATO is conscious of the weakness of the User ID/Password model it is migrating tax agents to the stronger digital certificate security model, with an intention of removing the User ID/Password model by end 2008. Useability of the ATO’s digital certificate security process has improved greatly since 2002 and we are confident that there will be no impact on usage of the Portal. In September 2007, 73% of tax agents were already using digital certificates. Providing a secure way to track and record interactions for online correspondence via Secure Email was challenging because most contain ‘In-Confidence’ classified information. Functions were provided for authentication and non-repudiation of correspondence as well as accounting for what occurred in ‘back office’ ATO operations. Privacy is a major consideration because of the increased potential for breaches. There is a need to ensure that established privacy policies in relation to the data are accurate, up-to-date and responsive. Accessibility by those with special needs or disabilities whether working for a tax agent or in the ATO requires specific tools and processes. To address requirements for the TAP we work closely with the Human Rights and Equal Opportunity Commission (HREOC) in Australia and include accessibility in the ATO’s usability testing prior to implementation. To ensure accessibility for visually impaired users, the TAP is compatible with screen readers. Interruptions to availability (eg. down time for upgrades, unexpected outages) can have an adverse impact on the business of the tax agent. As the TAP becomes more integrated in how tax agents work, it is increasingly important that we plan releases around busy periods, and maintain strong communications about scheduled down-times for maintenance and other activities. This is becoming critical as practices of tax agents are increasingly becoming a seven day operation with extended working day bandwidths. The delivery of online products and services is a costly undertaking and must be based on value for money. Even though tax agents displayed a high level of enthusiasm for the development of the TAP, it is essential that change management strategies are used for effective take-up. The TAP includes a web-based training package enabling users to learn about the portal at their own pace. Administratively, the ATO is also able to offer incentives such as automatic acceptance of online lodgment deferral requests, or an extended lodgment period of two weeks for businesses that file and pay electronically, whether directly or through their tax agent.

d. What resources were used for the initiative and what were its key benefits? In no more than 500 words, specify what were the financial, technical and human resources’ costs associated with this initiative. Describe how resources were mobilized
Costs and mobilisation of ATO resources Since the initiation of the project in mid-2002 the ATO has spent approximately $A34m ($US27m) on the Portal capital asset and has annual operating cost in the vicinity of $A4m ($US3.2m). In the technology area, corporately we ensured that we could reuse strategies and technology to develop the TAP initiative in other electronic projects across the ATO. This included the development of an ATO Online Strategy as well as service oriented application architecture, enhanced security infrastructure and web and user interface standards. During the gradual implementation of the TAP system, release specific activities were brought together under a Release Sponsor (an ATO official) who signed off the deployment when all elements required for the release were completed. These elements included the usual system development (including user design and testing) activities as well as business process design, release planning and change management. As the TAP was a new electronic system for both the ATO and tax agents, the emphasis on change management ensured that there was equal attention on building and transitioning the solution from all perspectives - people, processes and technology. This type of change management includes deployment support and handover of the project; internal and external training; performance support; internal communication; community transition including communication; and ATO business and client readiness. From a human resource perspective, developing the capacity to deliver services electronically through the TAP has meant that the ATO has been able to redirect its focus and move resources into programs that support tax agents and their practices. The introduction of the TAP has enabled the ATO to enhance relationship management, and further improve products and services that support tax agents. In addition, we consult regularly with tax agents about issues affecting them in their day to day Practice, and have set up formal consultative committees to ensure that they do not develop systems in isolation, but rather with the tax agent ‘lens’ of experience. The ATO is also committed to providing ongoing professional development and training through seminars and video streaming to provide further information about changes that affect tax agents and their practices. Relationship management needs are ever changing and the ATO is continuing to develop new service initiatives that support the tax agent community. Further to the TAP initiative, we have deployed financial and human resources into developing training products for those who are new to the profession and piloting a specialist technical call centre with an emphasis on resolving enquiries based on who is calling rather than what they are calling about, to better understand the callers’ needs. Harnessing electronic service delivery through the TAP initiative has enabled the ATO to now focus its resources on creating a personalised approach to better support the needs of the tax agent community.

Is the initiative sustainable and transferable?
Sustainability and Transferability In 2002, revenue design of tax administration systems and processes around specific taxes and functions was becoming considerably less relevant. Increasingly revenue bodies, including the ATO were taking steps to view issues from the perspective of specific social groups or market segments - sometimes known as a ‘client-centric’ approach. This development reflected a move away from the ‘type of tax’ and the ‘function-based’ approach to tax administration to a set of arrangements that aims to bring a ‘whole of client’ view. In essence, this put the needs of the client at the forefront of developing initiatives. The driver was the increasing recognition to better understand what influences taxpayers’ perceptions and behaviour to achieve overall improvements. In developing the TAP a ‘client-centric’, ‘whole of client’ approach was used. The TAP initiative was firmly rooted in the 2002 Listening to the Community program. The results were synthesised into a challenging Change Program to address major irritants, improve products and services, and provide a more flexible and sustainable taxation system to support the implementation of Government economic and social policies. Within the ATO, TAP introduced online self-service and was the forerunner to extending e-services to other social groups. Technically, the modular nature of the TAP solution lent itself to reuse. TAP is not a stand-alone solution - it is sustained through the integration with broader ATO strategies to achieve outcomes for government. The ‘client centric’, user designed approach has been institutionalised in the ATO and is integral in the values we promote and the way the ATO goes about its work. These are known as the 3Cs – consultation, collaboration and co-design. The TAP initiative does not purport to be ‘one size fits all’ and is specific to the needs of the tax agents and the Australian tax system. However the client-centric, user designed approaches are transferable throughout the public service, nationally and internationally. TAP provided an early case study in achieving broader Australian eGovernment objectives, i.e. ‘providing a citizen-driven focus’ and ‘working strategically to improve and reform underlying government processes’. It also demonstrated the underpinning principle to innovative technology i.e. ‘technology change will be incremental rather than revolutionary, yet the net effect of these increments will enable far-reaching changes for agencies’ (Responsive Government: A New Service Agenda, 2006 eGovernment Strategy, March 2006). TAP has also achieved the difficult incorporation of the different aspects of addressing social, multi-relational, regulatory, technical and organisational issues. The TAP initiative has incorporated key e-government principles relating to security, privacy and accessibility. Today TAP is integral to how tax agents access information about their clients and interact with the ATO. It has changed the way tax agents do business and it has changed the way the ATO does business – in a positive way. Information on the TAP now includes welfare and childcare government benefit information which means that tax agents can view information about their clients in one electronic view, rather than transacting with various government agencies.

What are the impact of your initiative and the lessons learned?
Lessons Learnt Lesson 1 - The main lesson learnt is the importance of taking a ‘client-centric’, whole of client approach and involving all stakeholders from the beginning. For the TAP initiative this meant developing a clear understanding about the tax agent community, what their needs and expectations were and to develop a response that addresses major irritants early. The quick delivery of the first few releases of the TAP were important to remove the angst in the relationship and to position it as one where ongoing support could be secured to enable more functionality and services to be delivered as the TAP initiative matured. It is important to publish intentions, measure usage and undertake surveys. However as the relationship matures there is also a need to provide other mechanisms to ensure effective consultation and collaboration. The ATO has achieved this through a strategic relationship management approach which included the establishment of a dedicated tax agent Relationship Management Group, as well as through various consultative committees. In recognition of the important role that tax agents play in the administration of the tax system the National Tax Liaison Group was also established with the Commissioner of Taxation as chair. All of the above elements are essential to achieve the full potential of an initiative and to institutionalise it so it is efficient and sustainable. Lesson 2 – Committed ongoing executive leadership and support has proven to be vital for moving the TAP initiative into full operation and to get the key stakeholders involved in its support and longevity. The Commissioner of Taxation ensured that the TAP initiative was driven top-down from inception with the launch in 2002 of the Listening to the Community initiative, through to spearheading the consultation and collaboration mechanisms required to maintain and improve the TAP initiative as well as the relationship. While driven top-down, the Executive also ensured that the TAP initiative was maintained bottom-up by allocating resources to continually improve the TAP, as well as to facilitate and grow the professional to professional relationship through all levels of the ATO. Lesson 3 – The last, but not least lesson learnt is the importance of focussing on client needs. This cannot be overstated. In addition to the benefits from a business perspective, from a relationship perspective, the TAP has been instrumental in strengthening the relationship with tax agents. Latest research at September 2007 has noted that the level of satisfaction with ATO services has doubled since 2003. The TAP initiative is a user oriented initiative and without constantly keeping the client in focus and co-designing all new functions and services, the initiative would probably have failed and ended as yet another good idea never brought to its full potential.


Institution Name:		Australian Taxation Office
Institution Type:		Government Agency
Contact Person:		Andrea Doungas
Title:		Communications Director
Telephone/ Fax:		+61447411710
Institution's / Project's Website:		+61392153685
E-mail:		andrea.doungas@ato.gov.au
Address:		14-16 Mason Street
Postal Code:		3175
City:		Dandenong
State/Province:		Victoria
Country:		Australia

The Problem

Solution and Key Benefits

Actors and Stakeholders

(a) Strategies

(b) Implementation

(c) Overcoming Obstacles

(d) Use of Resources

Sustainability and Transferability

Lessons Learned

Contact Information