Estonia uses a national identity card system to collect and share citizens' information. Essentially, citizens have a personal profile stored in government servers that is shared throughout all of the government e-services. It's like websites that use your Facebook login to access services on that website. It provides convenience and saves time and money by eliminating applicative data-gathering methods.
Of course, the first concern is security and with the recent NSA revelations, there may be a flaw in the Estonian ID card's security model. The relevance of the Estonian example is that in creating new agency structures where information flows freely, there has to be control over where the information flows and to whom.