It really takes a village to open a coffee shop

Why business licensing is the most broken part of digital government 

Nobody built the foundation

Before a pub serves its first drink, before a care home takes its first resident, before a taxi picks up its first fare, before a shop opens its doors, before a child can go to nursery: they all need permissions. They all have to exist, be issued, be verified and be maintained.

We joke internally that the world runs on licensing. The truth is, it does. Licences, permits, registrations: these are the permissions that allow any regulated activity to happen legally, and they sit underneath almost everything.

And this is one of the most fragmented, outdated and overlooked parts of how government actually functions.

Take a couple with their own savings on the line, pursuing their dream of opening a coffee shop. They find a unit on a high street desperate for new businesses, in an economy just as desperate for SME growth. They wrestle through Companies House, legal fees and solicitors, and they have an opening date. But first they need permissions to operate. Surely the hard part’s done.

They want to serve food and drink: that is a licence. They want music in the background: that is another. Two tables outside on the pavement: another. Open late on weekends: more requirements, more conditions, more scrutiny. And then someone suggests putting an espresso martini on the menu. Great idea. But one which means a separate alcohol licensing regime, its own formal application, a public consultation and the possibility of a hearing before a single cocktail gets served.

Five entirely reasonable decisions. Multiple portals, multiple renewal dates. Duplication of filling in the same form with their name, their address, their trading hours, their responsible person each time, into systems with no knowledge that the others exist.

There is no map. Owners piece it together through searches, solicitors, consultants, maybe a dose of ChatGPT.

All this before they serve that first coffee.

Now multiply it

Over 600 licence types exist across the UK. The ones relevant to any given business stay largely invisible until something goes wrong. The system was never built to tell them otherwise.

None of it was built for the digital age. Each authority built what it needed, when it needed it, with no expectation the result would ever need to talk to the system next door. The result is dozens of issuing bodies with inconsistent processes and, in many cases, technology unchanged since the nineties. Systems that cannot share data because they were never designed to.

The effect runs through everyone. Businesses spend time and money navigating a system that was never built with them in mind. Regulators work from incomplete records with no live picture of who is operating legally within their remit. Case workers spend the majority of their time on administration rather than the work they were hired to do. Enforcement officers work from desks rather than the streets and premises they should be covering.

Businesses globally spend hundreds of billions every year on compliance administration. Every pound of that is money spent proving permission to operate before a single product ships or a single service gets delivered. That is the cost of broken infrastructure. It is not the same thing as the cost of regulation.

We have been fixing the wrong thing

For the better part of a decade, digital government reform has focused on the front end: portals, apps, single login accounts, cleaner interfaces sitting on top of the same fragmented systems underneath.

You can redesign every service, every portal, every citizen journey. If the permissions layer underneath stays broken, you are just building faster on top of the same mess.

The conversation is beginning to shift. Scotland’s national digital strategy explicitly identifies licensing and permitting as a leading candidate for common, shared digital services. The UK government’s own analysis of digital reform has flagged that the count of highest-risk legacy systems is growing year on year, and that fragmentation across public bodies is one of the root causes of stalled progress.

The diagnosis is no longer the hard part. The hard part is deciding who is going to do something about it.

The people inside these systems already know

Talk to a licensing officer who has processed the same form manually for eleven years. Talk to an enforcement officer doing compliance checks from a printed spreadsheet. Talk to the owner of a bar who spent three weeks navigating six different portals before serving a single drink.

They all know. They have known for years.

The case workers know, the licensing teams know, and so does every business that has been through it. The knowledge of what good looks like has existed for a long time.

Portals and apps get announced at conferences and in the press. Licensing infrastructure does not. The incentive to fix the visible layer and leave the invisible one alone is not an accident. It is a structural feature of how reform gets funded and celebrated. And it is exactly why nothing changes.

The missing piece has never been invention or new technology, although it helps. It is the decision to treat licensing infrastructure as a shared public asset rather than a problem every authority solves alone, at great cost, again and again.

That decision has a cost either way. We can keep paying it invisibly, in friction and duplication and a compliance burden running into hundreds of billions globally every year. Or we can pay it once, deliberately, by building the foundation properly.

The front door of digital government has been renovated, redesigned and relaunched more times than anyone can count. It is still standing on rubble.

The narrative is shifting

AI and automation are making the broken foundations harder to ignore. You cannot automate a process that was never properly designed. You cannot add intelligence on top of data held across dozens of disconnected systems in formats that predate the internet.

The conversation about AI in government is, whether people realise it or not, is a conversation about the infrastructure underneath it. That is what makes this moment different from the last decade of digital reform attempts.

I have spent over a decade building software for the public sector. The problem has been visible the entire time. What is changing now is the appetite to address it properly, and that is worth paying attention to.

The next piece looks at what that actually means in practice. We have a front row seat building that very infrastructure here in the UK.

Written by James Buchan, CEO, ePass

ePass is building the shared infrastructure for licensing, registration and permitting across the UK. If you work in local or central government, regulation or interested in public sector digital reform, I’d love would like to talk – Connect on LinkedIn