With governments seeking to boost efficiency, improve public services, and address complex societal challenges, public sector organisations have high expectations for AI.

According to a new report from Capgemini Research Institute, titled Data foundations for government – From AI ambition to execution,’ 39% of public sector organisations aim to evaluate the feasibility of agentic AI within the next two to three years. Beyond this, 45% intend to explore pilot programmes, and 6% plan to scale their existing agentic AI initiatives.

The report found that attitudes towards agentic AI adoption are mostly consistent across segments, levels of government, and organisational sizes – two-thirds (64%) of organisations have progressed to pilots and scaled deployments, or are exploring genAI, with this number rising to 82% in defense agencies, 75% in healthcare, and 70% in security.

Organisations struggle with AI adoption due to data and trust issues

Despite ambitions to embrace and scale AI use, public sector executives cite data security issues (79%) and limited trust in AI-generated outputs (74%) as primary barriers to widespread adoption. In the EU, organisations report a significant gap in confidence when it comes to complying with the EU AI Act, with less than four in ten (36%) prepared to meet these requirements.

To progress their genAI adoption, public sector organisations require better data mastery, with the public sector showing limited progress in key areas of data management and utilisation since 2020.

The report finds that only 12% of organisations consider themselves very mature in activating data, while 7% report being very mature in nurturing data and AI-related skills. Only a fifth (21%) of public sector organisations surveyed have the required data to train and fine-tune AI models, including genAI models.

Data sharing concerns and the rise of the Chief Data Officer

Data sharing is vital for AI adoption as it boosts the volume and diversity of data to enhance AI model performance and optimise decision making. But data sharing initiatives are further complicated by concerns about data, cloud, and AI sovereignty.

Despite all public sector organisations surveyed either having or planning to have data sharing initiatives, they are not yet mature; most organisations (65%) worldwide are still in the planning or pilot stages.

Governments are increasingly recognising the critical role of harnessing data in the public sector, and this is reflected in the growing prominence of chief data officers (CDO) and chief AI officers (CAIO).

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As many as 64% of public sector organisations already have a CDO, while 24% plan to appoint one, showing a willingness to invest in dedicated leadership for data-driven governance.

Furthermore, the increasing strategic value of AI has resulted in over a quarter (27%) of public sector organisations appointing a Chief AI Officer, over a quarter (27%) already having one and 41% planning to introduce this new C-level role.

“With rising citizen demands and stretched resources, public sector organisations recognise the ways in which AI can help them do more with less. However, the ability to deploy genAI and agentic AI depends on having rock-solid data foundations,” said Marc Reinhardt, Public Sector global industry leader at Capgemini.

“Looking ahead, governments can be more agile and effective as AI augments the work of government employees to source information, conduct policy analysis, make decisions, and answer citizen queries. However, to reach this future, governments need to focus on building the right data infrastructure and governance frameworks.”

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