This past week, the Employment Development Department (EDD)
announced the replacement of the Unemployment Insurance (UI) check system with
a system utilizing debit cards. The replacement is noteworthy in itself, in improved
service delivery for California workers
and employers. It is also noteworthy for what it reveals about technology’s
role in California government.
Currently, EDD provides unemployment checks to 1.2 million
unemployed Californians. The 1.2 million number represents around 57% of the
2.1 million Californians counted as unemployed-adding "discouraged workers" and
workers involuntarily working part-time the number climbs to 2.6 million.
For some years, EDD has paid unemployment , which ranges up
to $450 per week, through a series of checks. The check system is subject to
the vagaries of the postal system: checks are delayed or delivered to the wrong
address or stolen. The new debit system requires the claimant to go through the
same processes of eligibility and regular certification. It transfers UI
payments electronically, enables claimants to monitor the balances, and provides an option of direct deposit.
The debit system is being rolled out in the next week. Here is a video provided by
EDD (industrial strength but fun) of the mechanics of the roll out.
As EDD Deputy Director Loree Levy pointed out in the
announcement last week, the debit card is the latest in the migration from a
paper system for the UI system. It follows the introduction in recent years of
on-line filing and on-line certification (Web-cert).
Over the past three decades in state government, there have
been numerous attempts to "re-invent" California government, spear-headed by good
government groups and public policy schools.
Hundreds of conferences have been held, reports written, legislative
hearings sponsored. Few if any have had
results-running up against the incentive structure of state government and the
pluralism of Sacramento.
The main improvements in reducing cost and improving quality
of service delivery over thirty years have been through technology. They have
been the result not of public policy analysts identifying a "problem", but of
technology companies seeking to sell a product. At EDD, technology has remade
the tax system (filing and monitoring of tax filings on-line), and the
Disability Insurance system (on-line filing as well as a debit card), as well
Deputy Director Levy estimates that the debit card will save
$4 million in administrative costs the first full year of operation, and
savings may increase as the UI system moves toward a paperless claim form
system, due to be in place by spring 2012.