2. Contextual factors and institutional models for digital government in Luxembourg

In the wake of the COVID-19 pandemic, being digital became a necessity to enable the continuity of activities in the public sector, economy and society. At the same time, the imperative of having a digital government surfaced as a top priority on political and policy agendas worldwide. The role of digital governments in driving a digital transformation that is people-driven, human-centred, inclusive, equitable and sustainable became a question that the public asked, and leaders had to answer and fulfil.

In this context, public governance is at the core in the efforts to attain this outcome: the legal and administrative structures, the institutional arrangements and mechanisms, and the policy instruments and tools to enable the change and shape the impact of what “being digital” involves. It is clear that a mature digital government is not one that is driven by adopting digital technology and data, but is one that uses them strategically as means to serve citizens and businesses better. Maturity also entails the ability of digital governments to respond to the rapidly changing context and adapt processes and services to deliver transparently, proactively and based on user needs.

Establishing a sound governance framework that suits the context and institutional setting of the country is, therefore, the first fundamental step towards securing the effective implementation of digital government policies. Building on the cumulative knowledge, experience and practices of OECD member and non-member countries in this area, the E-Leaders1 Handbook on the Governance of Digital Government was produced to establish a robust framework of analysis and a self-assessment toolkit with policy questions and recommendations to support governments in their digital transformation journey.

Designed in line with the OECD Recommendation of the Council on Digital Government Strategies (2014[1]) and the OECD Digital Government Policy Framework (2020[2]), the OECD Framework on the Governance of Digital Government presents three critical governance facets (OECD, 2021[3]) (see Figure 2.1):

  • Facet 1: Contextual Factors, which covers country-specific characteristics to help define the most suitable governance principles, arrangements and mechanisms according to the political, administrative, socio-economic, technological, policy and geographical context;

  • Facet 2: Institutional Models, which covers the formal and informal arrangements and mechanisms of different parameters (e.g. structure, set-up, approach, leadership, responsibilities, co-ordination, collaboration) to guide the design and implementation of digital government policies and achieve a sustainable digital transformation of the public sector;

  • Facet 3: Policy Levers, which covers policy instruments (i.e. strategy, project and financial management, regulations, standards) to support the coherent implementation of digital government strategies and use of digital technologies and data across policy areas and levels of government.

This chapter will be analysing the governance of Luxembourg’s digital government transformation in four main sections based on the first two facets – Facet 1: Contextual Factors (Figure 2.2) and Facet 2: Institutional Models (Figure 2.3). Facet 3: Policy Levers will be addressed in Chapter 3 along with digital talent and skills in the public sector.

The first section of the analysis will focus on the overall political and administrative culture and structure in Luxembourg (including sub-dimensions on the country’s power structure; the political continuity, stability and support for the digital transformation agenda; the degree of legalism; and the concentration/dispersion of administrative functions), and how these characteristics impact the governance of digital government in Luxembourg. The second section will study the socio-economic factors and technological context of Luxembourg (including the maturity of the private sector and digital industry; the level of digital talent and skills in the public sector and population; the level of public trust; diversity and mobility) and their role in shaping digital government maturity in the country.

The rationale for understanding and assessing the country context for the governance of digital government is that the experiences of various countries have shown that countries may benefit from having a governance model that takes into consideration the contextual factors that are unique to them. These factors shape the way governments design and implement policies for digital government, such as digital talent and skills, data-driven public sector and public service design and delivery. The following analysis will address conditions at a macro-level, which is helpful to gain a comprehensive understanding of what could be challenges or drivers for the digital transformation of the public sector.

The third section of the analysis will evaluate the macro-structure and leadership for the digital government agenda in Luxembourg (including the institutional set-up of the “organisation-in-charge”; institutional approach to digital government; roles and responsibilities of the “organisation-in-charge”; and the leadership on digitalisation across public sector organisations). The last section will review the existing co-ordination and co-operation arrangements and mechanisms in Luxembourg’s public sector that have a part in improving the coherence and sustainability of the digital transformation (including high-level co-ordination; and organisational and technical co-operation).

The rationale for understanding and assessing the institutional models for Luxembourg’s digital government is to see how the government Luxembourg lines up with the principles in Pillar 1 and 2 of the OECD Recommendation of the Council on Digital Government Strategies “Openness and Engagement” and “Governance and Co-ordination”. These principles encourage governments to be open, transparent and inclusive in their processes and operations, and to engage with stakeholders from the public sector, private sector and civil society. They also call for secure and stable leadership, commitment and organisational frameworks for inter-ministerial and inter-agency co-ordination and co-operation. All with the aim of ensuring that the implementation of any digitalisation strategy and plan for the public sector can result in tangible and lasting results across the different levels and sectors of government. Additional considerations with regards to the governance arrangements for data are covered in Chapter 4 and on public service design and delivery in Chapter 5.

Each country has its distinctive political and administrative characteristics, which implicate various opportunities and challenges for policy design and implementation. From the level of centralisation vs. decentralisation of the political system, and the degree of concentration vs. dispersion of administrative functions to the geopolitical situation and the political continuity and stability—all these contextual factors determine how governments can best approach their policies and programmes.

The Grand Duchy of Luxembourg is a parliamentary democracy in the form of a constitutional monarchy. The Grand Duke, as the head of state, embodies the independence and continuity of the state (The Government of the Grand Duchy of Luxembourg, 2021[4]). In accordance with the Constitution and the laws of the country, the Grand Duke exercises sovereign power, holds the executive power and assures the execution of the laws. In practice, the executive power is exercised by the government, which is led by the Prime Minister and consists of several members of the cabinet with the title of minister or minister delegate (European Union, n.d.[5]; The Government of the Grand Duchy of Luxembourg, 2020[6]).

The legislative power of Luxembourg is exercised by the Chamber of Deputies, a unicameral parliament composed of 60 members or deputies who are elected for a five-year term. The Chamber of Deputies votes on bills presented by the government, or on bills submitted on a parliamentary initiative by one of more deputies (The Government of the Grand Duchy of Luxembourg, 2019[7]). The Council of State is appointed as an independent consultative body that advises the Chamber of Deputies and the government in the legislative procedure (The Government of the Grand Duchy of Luxembourg, 2020[8]). The Grand Duke enacts the laws (The Government of the Grand Duchy of Luxembourg, 2021[4]). In the most recent three decades, the government of Luxembourg has largely demonstrated political continuity and stability albeit some changes to the political leadership and coalitions (Table 2.1).

On the digital transformation agenda, the government led by Prime Minister Xavier Bettel has continued to demonstrate strong commitment in setting out objectives for digitalisation of the public sector for the two legislative periods under his leadership. The government declaration presented in 2013 by the prime minister to the parliament sets out the development and promotion of the ICT sector as a goal, building on the image of being the “European Trusted Information Centre” that Luxembourg has gained. Related to this is also the goal of protecting critical infrastructure and raising risk awareness – which includes developing a coherent and global strategy to augment the digital competencies available in the country, and advancing the digitalisation of public services for citizens to benefit for accessing them online (The Government of the Grand Duchy of Luxembourg, 2018[9]).

The coalition agreement of 2018-2023 similarly emphasises the importance of digitally transforming the economy and the public sector, in which the Ministry for Digitalisation (MDIGI) was created for the purpose of improving the daily lives of people and simplify administrative processes. It also highlights the government’s pledge to adapt the existing legal frameworks and modify co-ordination and management mechanisms to support the process of digitalisation in the country (The Government of the Grand Duchy of Luxembourg, 2018[10]).

With parliamentary elections soon taking place in 2023, it is possible that the political agenda and priorities may change given the continuing COVID-19 pandemic, economic challenges and the recent destabilising security situation in Europe. Several government stakeholders have also expressed their concern for a possible change in the political support of the digital government agenda during the OECD peer review mission and workshops. With the MDIGI being a relatively young ministry, it would be important for the government of Luxembourg to continue securing the long-term sustainability of digital government policies and programmes.

The political and administrative structure in Luxembourg is characterised by a relatively high level of centralisation with a municipal level of decentralisation (European Commission, 2018[11]). The public administration of Luxembourg is organised into three districts, 12 cantons and 102 communes, of which 12 have a city status with Luxembourg City being the largest (Figure 2.4). While these divisions are for territorial and administrative purposes, the 12 cantons do not have administrative competencies whereas the 102 communes are the smallest administrative entities managed by municipalities (The Government of the Grand Duchy of Luxembourg, 2019[12]). The municipalities have administrative responsibilities and considerable autonomy in managing municipal interests (i.e. registration, utilities, transport, health, social welfare, sports, regional economic development and tourism, housing, culture, education), and liaise directly with the central government on the administration of national policy (European Committee of the Regions, n.d.[13]).

This political and administrative structure in Luxembourg could present as an opportunity or pose a challenge to advancing the digital government agenda depending on how the government uses it to its advantage. Considering the small size of Luxembourg, the centralisation and concentration of functions at the national level can benefit high-level policy development and co-ordination and facilitate a coherent definition and adoption of common policy instruments to enable a sustainable digital transformation. The government of Luxembourg has rightly identified this opportunity and is focusing efforts in this area now.

The challenge comes with the municipal level of decentralisation, as achieving alignment and coherence from national to regional and local levels will require designing ways to improve co-operation between the central government and the municipalities. This will be covered in greater detail later in the section “Co-ordination and collaboration within the public sector and ecosystem”. The government of Luxembourg can also devise creative and agile processes to balance and reap the advantages of both centralisation and decentralisation like in the case of Estonia (Box 2.1) – which presents a similar political and administrative structure: a strongly centralised government.

As a founding member of the European Union (EU), Luxembourg has been a Member State since 1958, a member of the Schengen area since 1995 and a member of the euro area since 1999 (European Union, n.d.[5]). In this context, Luxembourg is in a significantly stable, open and rules-based geopolitical situation – and its legal and regulatory frameworks are influenced by the EU’s legislations and policies. These include the Electronic Identification and Trust Services Regulation (Regulation (EU) 910/2014), the General Data Protection Regulation (Regulation (EU) 2016/679), Cybersecurity Act (Regulation (EU) 2019/881), Open Data Directive (Directive (EU) 2019/1024), Proposal for a Data Governance Act (COM/2020/767), Proposal for an Artificial Intelligence (AI) Act (COM/2021/206) and the series of EU eGovernment Action Plans (2006-2010; 2011-2015; 2016-2020) to name a few.

On 8 December 2020, ministers of all EU Member States signed the Berlin Declaration on Digital Society and Value-Based Digital Government, which calls for governments to take a pioneering role in driving a value-based digital transformation for European societies (European Commission, 2020[16]). With the EU being a leading global standard-setter on digital policies that embeds fundamental human rights and human-centred values, Luxembourg stands to gain significantly in having a high level of digital rights maturity backed by legislations, regulations and guidelines.

Yet, with a civil law system, the government of Luxembourg would need to ensure that it can overcome the possible legal challenges in innovating and securing the policy agility needed to promote the digitalisation of the public sector. Principle 12 of the OECD Recommendation of the Council on Digital Government Strategies calls for governments to “ensure that general and sector-specific legal and regulatory frameworks allow digital opportunities to be seized by reviewing them as appropriate, and including assessment of the implications of new legislations on governments’ digital needs as part of the regulatory impact process (OECD, 2014[1]).” It is crucial for legislations and regulations to be in place to enable and promote the transformation. This will be covered in greater detail in Chapter 3.

In sum, the political and administrative contextual factors in Luxembourg are inclined to favour digital government development positively. With relatively strong political support for the digital agenda, a small country and a centralised structure, the government has the potential and capacity to transform cohesively, effectively, with agility and speed. A fairly stable, open and rules-based geopolitical situation also provides a good legal basis for advancing the digital agenda in line with the EU’s vision “A Europe fit for the digital age”. Yet, political continuity for the public sector digital transformation agenda should not be taken as the status quo and efforts will be required to promote the administrative change needed in order to respond to new needs in the digital age.

Economic, societal and technological contextual factors are also important for understanding how the governance of digital government can benefit from and further economic and social development. For instance, indicators such as the overall economic climate, demographics, the level of maturity of the private sector and digital industry, the level of digitalisation and the use of digital technologies in society, are key in shaping expectations and in informing how public sector organisations can better meet the specific needs of citizens and businesses in the context of improving their standards and ways of living and working.

The economy of Luxembourg has historically demonstrated solid growth, low inflation and low unemployment. Over the COVID-19 crisis, the economy grew 6.5% in 2021 and is projected to expand by 3.7% in 2022 and 3.1% in 2023 with the support of stronger consumption and investment (OECD, 2021[17]). As a service-oriented economy focused on high-value technology, Luxembourg’s service sector represents more than 80% of its gross domestic product (GDP). General government expenditure constituted 42.3% of Luxembourg’s GDP in 2019, which is comparable to the 40% OECD average and 46.6% OECD-EU average (OECD, 2021[18]).

Luxembourg’s GDP per capita is 56% higher than the 50th percentile of OECD member countries (OECD, 2021[19]) and is the highest among EU Member States and the Schengen countries (European Union, n.d.[20]; eurostat, 2021[21]). However, income inequality is higher than in most advanced economies (OECD, 2021[22]). Luxembourg’s performance on the United National Human Development Index (HDI) also demonstrates very high and improving human development over the past two decades but significant loss due to inequality (UNDP, 2020[23]; UNDP, 2020[24]). Luxembourg’s human development-impacted inequality mainly derives from inequality in education and income, when compared to the OECD average or other very high HDI countries (Table 2.2).

These data insights are also in line with the main findings identified in the OECD Economic Survey of Luxembourg that revealed a huge need for the labour market to rebound and be revitalised, and that the government can do more to ensure inclusive and sustainable growth and development in the country Box 2.2 presents a deeper analysis of Luxembourg’s economic context and selected recommendations that are also relevant to consider in the context of the OECD Digital Government Review of Luxembourg, to support the development of a digital government ecosystem that is bolstered by a vibrant and mature digital economy and society.

Luxembourg’s economic context demonstrates the indispensable role that the government plays in shaping and driving the digitalisation agenda for the country, and that first becoming a mature digital government is essential to achieve that intended effect. When digital transformation is guided and managed properly by the government, all stakeholders in the country (i.e. public sector, private sector, civil society) should be able to reap tangible benefits in economic and social development, and see positive performance in productivity, inclusiveness, equality, labour market participation and well-being.

The employment in the government of Luxembourg as a percentage of total employment stands a little over 12%, and among the lowest with OECD member countries, signalling that the country has a relatively small public sector in terms of workforce. This is albeit its comparatively high annual average growth rate for government employment, at over 3% (OECD, 2021[29]). This, all the more, calls for a digital government that is lean, agile, efficient and effective.

As regards demographics, Luxembourg is one of the least populous countries in the EU with a population of 634 730 people (European Union, n.d.[20]). A landlocked country with Belgium, Germany and France as its neighbours, the society, culture and languages of Luxembourg are highly heterogeneous and diverse. While Luxembourgish is the national language, Luxembourgish, French and German are the administrative and judicial languages of Luxembourg (The Government of the Grand Duchy of Luxembourg, 2019[30]). Furthermore, foreigners make up 47.2% of the population and more than 170 different nationalities are a resident (The Government of the Grand Duchy of Luxembourg, 2022[31]).

In the process of digitally transforming the public sector, the government of Luxembourg is paying careful attention to the diverse needs, preferences and cultural norms of these population groups, and efforts should continue in the same direction during the implementation of the national digital government strategy. This may include tailoring the communication and engagement strategy when designing and delivering new public services that are digital and data-driven.

For instance, with 197 200 commuters coming into Luxembourg to work (STATEC, 2021[32]), and a wide diversity of nationalities as residents, Luxembourg sees high mobility across its borders. This increases the necessity in establishing robust, interoperable and inclusive digital identity solutions and public services that can be accessed and used easily within and across EU borders – and the government of Luxembourg has stepped up to meet this demand by being the second highest performing EU country providing cross-border services in the eGovernment Benchmark 2022 (European Commission, 2022[33]). This will be discussed in greater detail in Chapter 5.

The citizens of Luxembourg enjoy a high quality of life and high levels of trust in government (OECD, 2019[34]; OECD, 2020[35]), given efficient public systems such as healthcare and transport and one of the lowest levels of perceived corruption in the world. However, while trust in government ranks at the top-performing tier among OECD member countries, trust in others (i.e. people in general) ranks at the bottom-performing tier (OECD, 2020[35]). This presents an important role for the government of Luxembourg to strengthen trust among stakeholders.

Building on the high trust in government, the government is openly engaging the public in policy making and implementation processes, especially in areas such as digitalisation of services that involve a participatory and collaborative approach. In February 2022, the MDIGI launched the “Zesumme Vereinfachen” platform, an initiative that allows all citizens to be involved in administrative simplification. On ZESUMME-VEREINFACHEN.LU (zesumme-vereinfachen.lu), citizens are able to follow projects, submit ideas or proposals, vote for proposals, take part in surveys and participate in workshops. Users can access this platform across all devices and in the three languages of Luxembourg and English (The Government of the Grand Duchy of Luxembourg, 2022[36]). This ensures a transparent and inclusive participation, and forges an effective civic space where people are inclined to work together and with the government.

Finally, technological contextual factors specifically look at the country’s past, current and prospective technological development and the use of technology in the public and private sectors – from infrastructure and innovation to e-government heritage and legacies. These factors give a sense of why the current governance approaches to digital government are in place, and what kind of challenges and opportunities these present such that governments can advance their transformation.

In line with Luxembourg’s high level of economic and social development, the ICT infrastructures are also fairly developed. Presently, it ranks 11th among EU Member States in “Connectivity” of the 2022 Digital Economy and Society Index (European Commission, 2022[27]). The government is also in the course of implementing targeted policies on fibre, broadband, 5G and the Internet of Things (IoT) to enhance connectivity and productivity in the country (European Commission, 2022[27]). This includes the recent ultra-high-speed Broadband Strategy 2021-25.

Based on the data from the OECD Going Digital Toolkit (2022[37])2 and the 2022 Digital Economy and Society Index (European Commission, 2022[27]), Luxembourg performs very well in coverage and access: 96% of households are covered by a fixed very high capacity network (VHCN); 98% of the population is covered by at least a 4G mobile network; 97.4% of households have broadband connection; 87.9% of businesses have broadband at 30 Mbps or more (the indicator with the largest percentage growth from 2018 to 2021); and there is even a lack of disparity in broadband uptake between urban and rural households. However, there is room for advancement in the connectivity of devices: only 11.7 per 100 inhabitants possessing machine-to-machine (M2M) SIM cards below the OECD average of 26.9, and this number had decreased by 45.8% from 2018 to 2020. This measure of connectivity is important as a foundation for the IoT and its sensors to function.

Concurrently, the government of Luxembourg is actively promoting the uptake and integration of strategic digital technologies (e.g. AI, IoT, Blockchain, virtual reality [VR], high-performance computing [HPC] etc.) into its public governance and business processes (The Government of the Grand Duchy of Luxembourg, 2019[30]; The Government of the Grand Duchy of Luxembourg, 2021[38]; European Commission, 2022[27]). However, in spite of these recent policies to stimulate digital transformation in the public sector and economy, the uptake of digital government services in Luxembourg has been fluctuating over the past decade based on data from the OECD Going Digital Toolkit (2022[37]) (Figure 2.5) vis-à-vis the OECD average that has been increasing steadily. In addition, this indicator has not been moving in tandem with the gradual increase in ICT/digital coverage and Internet access across Luxembourg that has been discussed earlier.

Likewise, the eGovernment Benchmark 2022 found that Luxembourg experiences a medium level of penetration (79%) in the context of a high level of digitalisation (87%) – which indicates that there is still space to expand the number of online users in Luxembourg accessing public services despite recent efforts and progress to expand coverage and use of internet within the country (European Commission, 2022[33]; European Commission, 2021[39]). One notable factor identified in the OECD Going Digital Toolkit that may help to explain this challenge is the considerable increase in payment privacy and security concerns by Internet users which prevented them from engaging in online transactions from 2017 to 2019 (OECD, 2022[37]) – the same time period that saw a sharp drop in the uptake of online public services.

Luxembourg is no doubt leading among European and OECD member countries in laying the vital foundations for digital government maturity. Among countries in Europe, Luxembourg ranks 3rd in the eGovernment Benchmark 2022 and scores highly on user-centricity and cross-border services (Table 2.3). Across the world, Luxembourg ranks 33rd in the United Nations E-Government Survey 2020 and is considered a very high performer on the Online Services Index (OSI) and the E-Government Development Index (EGDI) (Table 2.4).

These are significant improvements compared to the OECD Digital Government Index 2019 where Luxembourg ranked 6th among EU27+ countries and 13th among OECD member countries – and was below the OECD average for being data-driven and acting as a platform (see Table 2.5).

While the socio-economic and technological context in Luxembourg is shown to be conducive and supportive for digital transformation in the public sector, it has revealed that the government of Luxembourg can enhance these advantages and benefits even further by taking action in the following areas: improving stakeholder participation (especially with users, citizens and businesses), being user-driven and proactive besides being user-centric, operating as a platform and being data-driven – which will be discussed in the chapters to come.

With the context around Luxembourg’s digital transformation having been assessed, it is apropos to look at the institutional models that make up its governance to steer the digital government agenda. A clear, effective and agile institutional model for digital government is essential for a sustainable digital transformation of the public sector in the long run. It sets out the macro-structure for how the public administration sets-up and approaches this comprehensive and cross-cutting process of modernisation and reform. It also provides a solid foundation for institutionalising and clarifying organisational and personal leadership for it to be effective, and the arrangements and mechanisms for co-ordination and co-operation in the public sector.

The government of Luxembourg comprises 24 ministries, led by typically one or more minister and minister delegate. In Luxembourg, MDIGI is responsible for leading and co-ordinating digital government policies in collaboration with other public sector organisations at the central level of government. Established under the Grand-Ducal decree of 5 December 2018 (Box 2.3), MDIGI is a young ministry but has a strong political mandate under the current government led by Prime Minister Xavier Bettel. It is currently headed by the prime minister and the minister of state who also serves as the minister for digitalisation, and a minister delegate for digitalisation.

As a line ministry, the MDIGI’s mission and remit cover the promotion and implementation of ICT and digital strategies in the public sector and at the national level – in collaboration and in consultation with other ministries and government agencies. For example, the MDIGI shares a number of competences with the Ministry of the Economy and the Department of Media, Connectivity and Digital Policy (SMC) of the Ministry of State (ME) on the Digital Luxembourg initiative, the monitoring and promotion of the ICT sector, the development of digital infrastructure and the strategies for emerging technologies like AI and 5G.

Apart from these shared competences, MDIGI solely oversees strategic tasks relating to the digital development of the public sector (i.e. administrative procedures, digital inclusion, information exchange, high-level co-ordination, the Government IT Centre [CTIE]) – which will be further elaborated below.

The experience reflected in the E-Leaders Handbook on the Governance of Digital Government show that governments largely either opt for the “organisation-in-charge” to be at the centre of government (i.e. under the presidency or the prime minister’s office) (e.g. Chile, France, the United Kingdom), under a co-ordinating ministry (e.g. Italy, Slovenia), a line ministry (e.g. Colombia, Estonia, Greece) or government agency (e.g. Australia, Portugal, Sweden).3 Among these diverse possibilities, governments need to most crucially ensure that the “organisation-in-charge” of digital government is able to steer the agenda and effect change vertically and horizontally based on organisational stability, legitimacy, accountability mechanisms and strong relations with other public sector organisations (OECD, 2021[3]).

Findings from the OECD Digital Government Survey of Luxembourg, administered in the context of this review, reveal that the leadership and co-ordinating role of the MDIGI on digital government is recognised by the majority of ministries and administrations surveyed – 87 % responded yes to the question “Is there a public sector organisation (e.g. division, unit, agency) responsible for leading and co-ordinating decisions on digital government at the central level of government?”. Out of these, 59% responded that MDIGI is the one responsible for this role while 10% mentioned that it is both MDIGI and CTIE, and 5% said that it is the CTIE.

However, 13% of ministries and administrations gave varying responses to what they thought were “organisation(s)-in-charge” of digital government in Luxembourg, which included popular answers such as the Department of Media, Connectivity and Digital Policy (SMC) as part of the Ministry of State (ME), the Ministry of Culture (MC) and the Digital Luxembourg initiative that is overseen by SMC.

During the OECD peer review mission, there was also a general recognition among public sector organisations that the newly-established MDIGI leads the strategy and implementation of the public sector digitalisation agenda – but some stakeholders were more familiar than others on its purpose, scope and responsibilities, depending on how closely they work with the MDIGI. In fact, public sector organisations tended to express greater familiarity with CTIE as the long-standing administrative body that develops and supports the use of the IT products and services for Luxembourg’s public sector organisations.

While this shows that there is an agreement among government stakeholders that MDIGI plays a key leading and co-ordinating role on digital government, at present, public sector organisations were inclined to view CTIE as the direct go-to partner should they want to digitalise certain processes or services. During the OECD peer review mission and capacity-building workshops, a broad consensus was gathered on the importance of further clarifying and communicating with public sector organisations about what MDIGI is doing, aims to achieve, and importantly, how it can support and work with other government stakeholders in their digitalisation journey.

CTIE can trace its roots back to when its affiliate institute was created in 1974 (The Government of the Grand Duchy of Luxembourg, 2008[45]). As the technological arm of MDIGI, CTIE is responsible for G2G4 IT solutions for Luxembourg’s ministries and administrations – such as network and communication infrastructure, hosting, private cloud (infrastructure as a service [IaaS]), platform (platform as a service [PaaS]), generic and customised software solutions (software as a service [SaaS]), secure document generation, individualised mass printing, office automation, telephony and infrastructure security. CTIE also plays central role in the management of G2C5 and G2B6 portals and platforms: GUICHET.LU (guichet.lu) and MYGUICHET.LU (myguichet.lu). Its remit is set out in the law of 24 November 2015 amending the amended law of 20 April 2009 establishing the CTIE (The Government of the Grand Duchy of Luxembourg, 2015[46]) (see Box 2.4).

While it is understandable that public sector organisations are in the habit of consulting CTIE as the first point of contact for implementing IT solutions, reinforcing the strategic role of MDIGI in promoting and implementing a transformation that is not just from analogue to electronic, but one that involves a system-wide change in mindset, culture and ways of working will be highly beneficial. As mentioned in the beginning of this chapter, digital transformation should not be technology-driven but value -, result- and people-driven, holistic, horizontal and coherent throughout the public sector.

In this sense, the government of Luxembourg has taken a step in right direction by establishing MDIGI in 2018. With the COVID-19 crisis putting back into focus the value and importance of governing digital well, MDIGI is presented with a golden opportunity to take on the full leadership and responsibility for advancing the digital government agenda de facto and de jure – with the support of CTIE on IT project implementation. However, given that a significant number of public sector organisations are in the habit of “relying” on CTIE for their digital transformation, it would be advantageous in this context to change the paradigm of how public sector organisations work with MDIGI and CTIE.

For instance, the mindset that CTIE is the administrative body that helps with IT solutions and that it should assist public sector organisations entirely with their implementation can be changed to one that sees MDIGI as the first point of contact and consultation for formulating their institutional digitalisation strategy in line with the Electronic Governance Strategy 2021-2025, the CTIE’s service offerings, and the organisation’s capacity. This exercise would be most effective when undertaken on the basis of shared leadership and responsibility with the public sector organisation, meaning that MDIGI should purposefully encourage and empower all ministries and administrations to be accountable for their own digital transformation and to partner with, rather than be fully reliant on, the CTIE for resources and supporting the change. This point is further substantiated with the fact that the Electronic Governance Strategy 2021-2025 was proposed and approved by all the ministries in Luxembourg that are members of the Inter-Ministerial Committee for Digitalisation and by the Government Council in 2021. As such, this mechanism for strategic co-operation promotes shared leadership and responsibility for the digital government agenda.

Despite all ministries having a representative in the Inter-Ministerial Committee for Digitalisation, four of the 39 ministries and administrations surveyed in the OECD Digital Government Survey of Luxembourg indicated that they do not know if Luxembourg has a national digital government strategy. Out of 35 that do know, 46% of them see the national strategy as strongly relevant for them at the organisational-level, 37% view the relevance as moderate and 17% indicate the relevance as weak (OECD, 2021[44]) (Figure 2.7).

This highlights a key opportunity for MDIGI and the ministry representatives in the Inter-Ministerial Committee for Digitalisation to direct efforts into better communicating, sharing information and engaging with their respective administrations on the vision, objectives and real relevance of the Electronic Governance Strategy 2021-2025 for them. With this knowledge, public sector organisations and their civil servants can be better positioned and empowered to formulating and implementing their institutional digitalisation strategy that is, at the same time, coherent and aligned with the national one. Table 2.6 shows that 39% of ministries and administrations do not yet have a formal institutional digital strategy and 33% will stand to benefit from consulting with MDIGI and CTIE about their institutional digital strategy.

Looking ahead as the government of Luxembourg advances in its digital maturity, it is paramount for MDIGI to lead and co-ordinate well with other ministries and administrations to mobilise a whole-of-government digital transformation that is coherent, integrated and effective – especially leveraging the Inter-Ministerial Committee for Digitalisation that MDIGI and CTIE presides over. Strengthening the mandate and role of MDIGI as the organisation-in-charge of this purpose on the one hand, while clearly informing, consulting and engaging with government stakeholders on how digital government could be understood as a shared imperative on the other hand will, therefore, be beneficial to that effect.

Clear and stable leadership is also instrumental in reinforcing the governance of digital government. Good leadership sets out a vision, creates an environment that supports digital transformation and actively champions the extensive change involved (OECD, 2021[48]). In Luxembourg, the government CIO is the director of CTIE and together with the government counsellors of MDIGI, all of them sit in the cabinet of the MDIGI. The leadership of CTIE, MDIGI and other ministries work together closely and frequently, for example in the Inter-Ministerial Committee for Digitalisation (more on high-level co-ordination will be discussed in the next section).

Experience drawn from the E-Leaders indicate that the perception of the government CIO is to focus on strategic and system-wide decision-making. The government CIO can be purely an administrative role (e.g. the United States), shared with a ministerial role (e.g. Colombia) or one that reports to a minister (e.g. New Zealand) (OECD, 2021[3]) (Box 2.5).

In the case of Luxembourg, the government CIO is very active in strategic decision-making and policy implementation linked with digital government. Besides being the director of CTIE and a member of the MDIGI cabinet, the current government CIO in Luxembourg is also the president of the Inter-Ministerial Committee for Digitalisation (shared presidency with the MDIGI), and the president of the Government’s Sectoral Committees for Interoperability (CSI) under the National Committee for Interoperability (CNI). At the same time, the government counsellors of MDIGI collaborate with the government CIO in defining, developing and implementing the digital government agenda.

However, findings from the OECD peer review mission indicate that there is untapped potential for MDIGI to also incorporate an administrative leadership role of empowering and creating opportunities for greater alignment and sharing among CIOs across the public sector of Luxembourg. To address this gap, MDIGI and CTIE are currently developing an Advisory Service for Digitalisation to support ministries and administrations in setting up their own digitalisation strategy in line with the goals of the Electronic Governance Strategy 2021-2025. The process includes a Digital Maturity Assessment.

To fully secure a robust and stable leadership, it is important for the leadership of the “organisation-in-charge” to be able to operate in an environment that is conducive to its consistency and sustainability. This includes strong institutional co-ordination and collaboration mechanisms as mentioned above, and the hierarchical importance and legal basis (e.g. legislation, decree) of these positions would need to sufficiently empower the function to lead the digital government agenda beyond political cycles. As MDIGI matures with time, continuing to cement a strong relationship and alignment in governance and leadership between MDIGI and CTIE will be consequential for promoting long-lasting and tangible digital transformation of the public sector.

Co-ordination, co-operation and collaboration are three key processes that favours coherence and supports the effective design and implementation of policies. Institutionalised arrangements and mechanisms that support these processes help to mitigate policy siloes, gaps and inaction, while encouraging exchanges of know-how, practices and skills. Achieving a public sector culture that supports sound co-ordination, co-operation and collaboration is, therefore, chief for good public governance and cultivating a dynamic digital government ecosystem.

Principles 5, 6 and 7 of the OECD Recommendation of the Council on Digital Government Strategies (2014[1]) spotlight the significance of promoting inter-ministerial co-ordination and collaboration, and engagement and co-ordination of relevant agencies across levels of government to pursue the digital government agenda. Drawing on the experiences and practices of OECD member and non-member countries (OECD, 2021[3]), governments typically rely on three forms of co-ordination:

  • High-level co-ordination that brings together ministers and secretaries of state to ensure that the leadership of public sector organisations are aligned in the implementation of the national digital government strategy and its policies vis-à-vis other policy strategies and areas of reform;

  • Organisational and technical co-operation that harmonises the tactical and operational aspects of implementation across public sector organisations, thereby building horizontal alignment and coherence within and across levels of government;

  • Civic collaboration that covers the open engagement and participation of relevant public, private and civil society stakeholders in the digital government to ensure an inclusive, equitable and sustainable digital transition.

First, a little over a year after the establishment of MDIGI in February 2020, the government of Luxembourg agreed on the implementation of digital governance for the public sector comprising an Inter-Ministerial Committee for Digitalisation and a High Committee for Digital Transformation.

The Inter-Ministerial Committee for Digitalisation was established to co-ordinate ministries in the development and implementation of strategy and initiatives for digital government and the digitalisation of public services until 2025. It also aims to strengthen the governance of digital government and improve the coherence and cohesion of digital transformation in the public sector, in line with the Electronic Governance Strategy 2021-2025. Under the leadership and co-presidency of MDIGI’s first government advisor and the government CIO, it brings together representatives of all ministries on a high-level platform for horizontal co-ordination on digital government strategies and action plans, sharing best practices and creating synergies among the ministries and administrations in Luxembourg.

The High Committee for Digital Transformation that is under the mandate of MDIGI is not yet operational due to delays related to the COVID-19 crisis. It is envisioned to bring together the minister for digitalisation, minister delegate for digitalisation, other ministers relevant for the development of digital government on one side, and the private sector, labour unions, non-governmental organisations and IT experts or public research representatives on the other side – to discuss national digital transformation, which includes digital government, economy, skills and society etc. The High Committee for Digital Transformation is planned to be launched by September 2022. Making this committee fully operational in the short term would be beneficial for the right and timely implementation of the Electronic Governance Strategy 2021-2025 as several initiatives require strong partnerships and involvement of external stakeholders.

Second, with digital inclusion being one of the four strategic axes for MDIGI, the Inter-Ministerial Working Group for Digital Inclusion was created in 2019 comprising representatives from 18 ministries to discuss the development of the National Digital Inclusion Plan 2021-2025 that was adopted in September 2021. Co-ordinated by MDIGI, the Inter-Ministerial Working Group for Digital Inclusion took stock of current government actions on digitalisation and digital inclusion, thereby producing a catalogue of projects that various public sector organisations are intending to implement to promote digital inclusion. The National Digital Inclusion Plan 2021-2025 will be evaluated annually by MDIGI and the Inter-Ministerial Working Group for Digital Inclusion (Chronicle.lu, 2021[51]).

These are two more prominent high-level co-ordination bodies amongst other inter-ministerial co-ordination committees, advisory committees and working groups that have been set up to work on priority areas like AI, technology and ethics. Yet, as relatively new initiatives, findings from the OECD peer review mission demonstrated that much still needs to be done to truly formalise and maximise the value of high-level political and administrative co-ordination and translate this into tangible institutional co-operation at the organisational and technical levels to reap the results.

The results of the OECD Digital Government Survey of Luxembourg (2021[44]) also denote that more can be done to institutionalise and make inclusive these co-ordination bodies as 36% of government stakeholders that responded are not aware of any formal public sector body for institutional co-ordination. Of the 64% that do know of at least one, 46% are part of these co-ordination bodies while the remaining 18% are not (Figure 2.8).

Moreover, out of 46% of the surveyed government stakeholders that know of a formal co-ordination body and participate in it, less than one-third of this group found it to be an effective mechanism in reflecting their institutional needs and priorities while more than two-thirds appraised it to be moderately effective (OECD, 2021[44]). Currently, the Inter-Ministerial Committee offers its members the possibility to present their new projects, exchange on their needs, developments or simply request more information on subjects of interest. This working process can be developed further into communities of practice or discussion sessions on how members can better co-ordinate on specific projects or solutions in the pipeline.

Another reason is that while the co-ordination body aims to identify institutional digitalisation needs and address them, government stakeholders find that the priorities for implementation defined by MDIGI and CTIE are not as clear as they would like them to be. One more salient reasoning pointed out that given the diverse group of stakeholders involved, the applicability to specific policy areas and the follow-up supervision was relatively limited.

Furthermore, among the government stakeholders that know of the national digital government strategy, 57% of surveyed public sector organisations did not participate in the formulation of the strategy, 26% said that they did while 17% were not sure (OECD, 2021[44]). These aforementioned points underline that the arrangements and mechanisms for high-level co-ordination in the government of Luxembourg can hugely benefit from becoming more open and clearer in the engagement of public sector organisations from the outset of designing any policy, and setting in place accountability mechanisms to ensuring follow-up action that is coherent and aligned yet tailored to individual policy areas.

As regards organisational and technical co-operation, the government of Luxembourg has made noteworthy advances in the governance of interoperability at the national and sectoral levels in 2021. The CNI comprises representatives of relevant sectors and seven CSI: legislative power; central government; judiciary; municipalities; education sector; health sector; social security sector – all of which manage and organise themselves autonomously. MDIGI has additionally set up the Competence Centre for Interoperability (CCIOP), which provides support to the secretariats of the CNI and CSI, and co-ordinates activities and initiatives related to the National Interoperability Framework (The Government of the Grand Duchy of Luxembourg, 2022[52]).

MDIGI has also done well in co-operating with a large number of ministries and administrations –71% of surveyed government stakeholders indicated that the representative responsible for leading and co-ordinating digital government policies in their public sector organisation (e.g. CIO, digital ambassador, IT personnel) is doing so with MDIGI while 29% do not or are not sure (OECD, 2021[44]) (Figure 2.9).

Looking ahead in advancing governance maturity, the government of Luxembourg could consider formalising these institutional working relationships in order to expand the reach and impact of MDIGI. The current way of working in the public sector of Luxembourg relies largely on informal, ad-hoc and existing internal networks – a cultural fact given the relatively small size of the government and longstanding organisational structures and roles within the public sector. While this can be beneficial to rapidly advance on specific initiatives, it can limit strategic alignment and communication between MDIGI and other public sector organisations. In order to truly facilitate horizontal co-operation at the organisational and technical levels throughout the public sector, the government of Luxembourg could aim at making accountability, ownership, inclusiveness, transparency and stakeholder engagement at the heart of all co-operation mechanisms. These institutional mechanisms could focus on harmonising the thinking, culture and approaches behind the public sector digital transformation agenda.

One effective way is to embed these suggested institutional mechanisms for better alignment and communication in the Inter-Ministerial Committee for Digitalisation. This can ensure that information and the awareness of opportunities for co-operation is properly passed on from the ministerial representatives in the Inter-Ministerial Committee for Digitalisation to civil servants working in their own or other ministries and administrations that they can collaborate with. This in turns strengthen the knowledge and capacity to take concrete action on digitalisation at the institutional level. Another current example is a special working group that has been set-up to develop and implement the once-only principle with thematic groups. This can serve to raise awareness and foster co-operation on these technical issues.

Finally, building on Luxembourg’s relatively strong level of digital maturity, the government can consider creating more opportunities for open exchange and engagement with relevant stakeholders in the broader digital government ecosystem comprising citizens, civil society and the private sector – thereby creating space for accountability, ownership, innovation and agility across various entities and sectors, and enabling a system-wide digital transformation of the public sector, economy and society.

Efforts to inform, consult and engage with these stakeholders at the central and municipal levels can be ramped in tandem with the roll out of the National Digital Inclusion Plan 2021-2025. In regards to the private sector, the MDIGI can look towards increasing its engagement with stakeholders such as the Luxembourg Chamber of Commerce and Luxinnovation to boost the development of its GovTech ecosystem. The recent establishment of the GovTech Lab is a good initiative in this light. It is a common project managed between MDIGI and CTIE, which has the goal of promoting the culture of open innovation and a co-creative approach to the digitalisation of public services by finding creative and novel solutions from the market.

To manage all these efforts, the government of Luxembourg can benefit from setting up a formal body that strategises, organises and promotes collaboration with the digital government ecosystem to undertake initiatives such as the “Zesumme Vereinfachen” platform and the GovTech Lab’s events and activities (Box 2.6). The High Committee for Digital Transformation in Luxembourg has this mission to manage this collaboration with stakeholders in the digital government ecosystem. The undertaking of the above-mentioned initiatives will, therefore, be assured with the creation of this strategic co-ordination governance body by September 2022.

Such initiatives have also been undertaken in other OECD member countries, including Finland, Spain and the United Kingdom that demonstrates the government of Luxembourg’s strong awareness and capacity to engage with external stakeholders (Box 2.7). Namely, Spain’s City Observatory is similar to Luxembourg’s “Zesumme Vereinfachen” Platform, and the United Kingdom’s activities to support co-design with users are also similarly planned to be done by the GovTech Lab and the Zesummen Digital in Luxembourg.


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← 1. The E-Leaders refers to the OECD Working Party of Senior Digital Government Officials, which was established to foster knowledge sharing and peer-to-peer learning to support policy makers around the world in advancing digital government policies’ design and implementation for the benefit of economies and societies. It serves as a safe space for international co-operation, in collaboration with OECD member countries and invited non-member countries, based on their experiences of “what works and what does not work” to overcome policy challenges, seize policy opportunities and improve policy impact.

← 2. The OECD Going Digital Toolkit helps countries navigate digital transformation, which affects many aspects of the economy and society in complex and interrelated ways. This policy instrument is based on a framework of seven policy dimensions: 1) access to communications infrastructures, services and data; 2) effective use of digital technologies and data; 3) data-driven and digital innovation; 4) good jobs for all; 5) social prosperity and inclusion; 6) trust in the digital age; and 7) market openness in digital business environments. The Toolkit maps a core set of indicators to each of the seven policy dimensions and provides a benchmarking exercise for OECD member countries and key partners. For more information, see: https://goingdigital.oecd.org/.

← 3. See: https://www.oecd.org/fr/gov/a-to-z-public-governance.htm for the definitions of public governance terms.

← 4. G2G stands for government to government.

← 5. G2C stands for government to consumer.

← 6. G2B stands for government to business.

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