Government Economic Model (GEM)

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Due to the dynamic and ever-changing socioeconomic environment, Governments around the world are facing unprecedented challenges. To solve these challenges effectively, decisions need to be well-informed – incorporating the latest data with an ability to predict all potential outcomes (thus avoiding any unintended consequences).

The Government Economic Model (GEM) tool has been used by the government of Guernsey to model demographic, economic and government revenues using real-time data from its new e-census data collection tool. Guernsey is a first-mover in adopting this cutting-edge modelling technology to help government develop smart policy and optimise their decision-making.

Case study

The States of Guernsey (SoG) engaged with Dorey Financial Modelling to create a smart government modelling tool. In response to their brief, Dorey Financial Modelling created a bespoke model – GEM (the Government Economic Model).

GEM is a ‘Smart Government’ solution that provides insight into the data collected by government, allowing them to test scenarios which may affect a jurisdiction or country. Powered by proprietary algorithms, the tool was designed to reduce fear and uncertainty around government policy, by giving government ‘Smart tools’ to test various demographic and/or economic scenarios.

As a dashboard in car shows the speed and different levels of oil and petrol, our ‘SmartGov’ tool offers a similar dashboard to show how an economy is performing at a particular point in time. This gives decision-makers real-time information to better understand the need for public services, where expenditure should be concentrated and how to optimise government expenditure relative to revenues.

The GEM model has been used in the following ways to benefit the citizens of Guernsey:

• Modelling the number of future school cohorts to inform teaching requirements and the number of school seats required across pre-primary, primary and senior schools. The GEM tool has been used to project different scenarios about the number of children entering the school system over a number of years, based on dynamic variables such as the birth rate.
• The model has tested a variety of scenarios and mapped this over to a range of possible outcomes. This information has been used to assist with decision-making on the optimum number of schools required on the island.
• The crematorium needed support and advice on the predicted local death rate and, using current local mortality rates, predict the capacity needed in future years. This has provided the basis for understanding the infrastructure requirements – both now and in the future – to ensure there is enough supply to meet future demand.
• Understanding the volume of care home spaces needed – both now and in the future. GEM can model the likely number of people requiring care home support over a series of different time horizons, so residential care homes can plan for the future, and extra bed spaces can be added where required. This ensures there will be sufficient capacity for people most in need of care support, at the time they need it.
• The information from GEM has been used in a number of different reports created by the States of Guernsey. Some of the figures generated from the GEM tool have been used by consultants KPMG for their model for future healthcare on the island. The ability to model the age of individuals, understand population changes – and the effects it may have on service provision – is critical. This might be in order to identify additional future service requirements from the growing elderly population, or to review a certain demographic which has a particular propensity for a certain type of care – and how this might evolve over time.

What our clients say

“We were looking for a company that could be a world leader in this area. This tool enables us to make better decisions to benefit islanders, the economy and government.“

Colin Vaudin
Chief Information Officer, States of Guernsey