Innovation in the public sector

Public sector innovation seems to be flavour of the month. I have just attended NESTA’s ‘Public Service Innovation Summit’, where Gordon Brown and two Cabinet Ministers turned up to issue an ‘invitation to innovation’.

In the past fortnight, Forum held two events on public sector innovation: Climate Finance – the launch of a project which will look at innovative low carbon financing in the public sector; and the i-team – which showed how local authorities can innovate to tackle climate change. And the Design Council is soon to launch a new programme called ‘Public Services by Design’.

So why the renewed interest in this topic? Public sector leaders have been talking about innovation for a number of years. But the agenda has been given added impetus by the likely impacts of the recession on public spending. Anyone who reads the papers will know that the public debt we are accumulating because of the economic downturn will lead to very deep cuts further down the line. After a decade in which lots of money was pumped into public services, the tap will be turned off.

But even though there’ll be less money, people are ever more demanding in what they expect from public services. And government targets – particularly on climate change - are getting ever tougher. So, the public sector faces higher public expectations, stronger targets, and less money.

The only way out of this crunch is to innovate in how we deliver public services.

Gordon Brown argued for exactly this and for a “leap forward to a low-carbon economy”. (He also, tantalisingly, trailed “big announcements to come on renewables, carbon capture and storage and efficiency in buildings”).

The danger, of course, is that innovation actually gets cut back because of spending pressures. Public sector bodies may focus on their core activities and stop funding the riskier stuff at the edges. To help counter this, NESTA has issued a call for 1% of all public spending to be earmarked for innovation. This is a target we should support.