Wales : State of Innovation? Or doing the wrong things better?

In the last few weeks, a report entitled State of Innovation (pdf) - authored by Nesta's Matthew Gatehouse and Adam Price - was published as part of the Welsh Public Services 2025 programme.

It sets out a vision of a more innovative Welsh public sector which, considering it's proportionally large impact on the Welsh economy, could well become necessary if we want to see public services delivered more efficiently, and more imaginatively, in the backdrop of public spending cuts.

Why the public sector needs innovation

The report highlights a "triple vice":

• Public spending cuts and austerity – The impact is likely to last for at least five years, probably more, affecting the general Welsh economy (due to more public sector employees). There's also the issue of "Offa's Gap" – a gap in economic productivity between Wales and the rest of the UK. So public services can't be based off the back of continuous economic growth filling coffers anymore.
• An ageing and ill population – Rates of child poverty and chronic illness remain above UK averages. Wales also has a proportionately older population too, with the number of over-75s expected to increase by up to 80% by the 2030s.
• Environmental and social pressures – We increasingly expect to do activities "on demand" and "on the fly" since the advent of things like social media - expecting the same flexibility from our public services. We're still using more than our fair share of natural resources despite commitments to "sustainability". This impacts the public sector, as much as the private sector and individual households.

What does public sector innovation actually mean?

The report says, "new ideas that work at creating public value". In English, I think that means improving how things are run, instead of simply throwing money at problems and hoping that'll work –  the usual way of doing things. "Working smarter", then.

The report describes three different types of innovation :

• Incremental – Smaller changes to existing services over a longer period of time.
• Radical – Significant changes to existing services, without altering the underlying purpose of those services.
• Transformational – "Ripping the whole lot up and starting again", with completely new services or methods of service delivery.

I think it's safe to say that the Welsh Government and civil service often opt for "incremental" change, or even not bothering with change at all, and rarely make the step up to "radical" innovation. Those "transformational" changes require new technologies, mind-sets and skills; so they might sound seductive, but might not always be the best option on the table.

Present Welsh public service innovation

Foundation Phase is given as an example of where the
Welsh public sector has been "innovative". Similar examples
are fleeting, however.
(Pic : npted.org)

Devolution is said to have been delivered off the back of "Made in Wales" solutions to long-standing problems in areas like the economy and health. However, there's lament at the lack of innovation. Instead – and I think we all know this, except the people at the top – we ended up with Westminster policies simply being "tuned" to Welsh needs. The civil service got used to doing things a certain way, without being as "stand alone" as Scotland and Northern Ireland.

Innovation in Wales extends to freebies and subsidised schemes. Low-hanging fruit, sometimes cheap to deliver, and politically successful for Welsh Labour. In other cases, there've been more dramatic changes, like the introduction of Foundation Phase, and the proposed organ donation opt-out law.

One key factor in all this was the Welsh Government's adoption of "partnership and persuasion", instead of aping the more hostile relationship between Westminster and those delivering public services on the ground in England.

There are said to be two "defining strengths" with regard innovation in the Welsh public sector :

1. Political cohesion – Welsh public services are "closely knit", with the potential for a highly co-ordinated system for innovation, helped by pan-Wales bodies.
2. Social sciences – Welsh universities produce "world-leading" social science research – for example, Cardiff's School of Planning. This has been added to via the creation of things like the Public Policy Institute, as well as independent bodies like the Bevan Foundation and Institute of Welsh Affairs.

However, there has been frustration in Cathays Park at the lack of progress made in delivering at a local level by councils and various public bodies. There are an awful lot of other roadblocks too, namely :

• Organisational thinness – We haven't got the numbers to develop the "big" institutions needed to develop the right skills.
• Lock-out – Small-c conservatism and insularity in the Welsh public sector, where everything is done "on the inside" since the "Bonfire of the Quangos".
• Lack of citizen engagement – Service users are best placed to point out how things could work better, but aren't being asked, or aren't bothered enough to care.
• Fragmentation – There's no single system to highlight successful innovations and share them between different parts of the public sector.

What are the barriers to public sector innovation?

These are all things anyone who follows Welsh politics closely will agree with. It makes for depressing reading, but most of you will be nodding along I'd expect.

• Hierarchies and "silo mentalities" – Seeing radical ideas from "outside" as a threat, and operating in a way that creates barriers to sharing ideas between different parts of the public sector. There's very little mixing of academic research with practice.
• Risk aversion – Public services staff seeing innovation as a threat to their job, or a challenge to the comfy status quo. The need to be accountable and a need for "certainty" means there's a disincentive to make major changes that could have a big pay off, but might not work.
• No rewards – "If it ain't broke...." mentality, meaning if a service is trundling along fine, it won't be tampered with by managers. Also, radical changes are often flagged up by the media and then opposed by service users, trade unions and politicians.
• Short-termism – Public service staff work to fix immediate pressures and on administration, instead of "taking a step back and seeing if you can do things differently".
• Politics – Contributes to short-termism by "demanding instant results" rather than more effective longer-terms solutions. The Foundation Phase is cited as an example, where the results won't be known for perhaps another decade.

Although these are general barriers that can happen everywhere, there are more Wales-specific problems too :

• Higher proportion of people working in the public sector, who don't get rewarded for innovation and might fear their job is at risk by adopting riskier, untested methods of service delivery. Because of lower private sector employment, they might worry they won't find another job.
• A lack of creative leadership in public management, who end up perpetuating the above.
• Innovation is seen as a "distraction" from service delivery in Wales compared to England.
• Auditing compares public services with existing "good practice" rather than taking into account radical and untested/unproven schemes. Staff said they end up trying to meeting audit checklists rather than coming up with new ways to deliver services. This might result in services improving, but only because of "doing the wrong things better."

What can be done?

That's actually the wrong question. One of the key tenets of the report isn't, "What could be done?" But more, "Wales is doing a lot already, it just isn't being exploited as it could be." It contained plenty of examples, but I decided not to go into them for the sake of brevity (LOL!).

In terms of specific proposals, there's a national action plan outlined as :

1. Bringing "social science research and public service practice" closer together, with greater collaboration, generating the evidence base needed to put forward the case for more radical public service reforms.
2. Making innovation skills a key part of public management training, in order to "create a cadre of leaders in Wales who create a new vision for public services." This would help turn innovation into workable projects.
3. Engaging more independent bodies in public service innovation, to create a more "entrepreneurial culture" to drive up productivity, and develop enterprises to provide services within local communities.
4. Incentivise partners in the private sector – especially technology – to turn Wales into a "global test bed" for innovations in public services. Examples include digital education and developing new technology in reaction to an ageing population.

There are also other proposals and unanswered questions, like :  funding innovation as a proportion of public sector spending (in the same way private companies invest in R&D), prizes for innovation and changes to how performances are measured to make "taking risks" more attractive.

Can Wales become a State of Innovation?

Ultimately, you'll have to ask Carwyn and the civil service. He's made small steps in that direction through the establishment of the Public Policy Institute, as covered by A Change of Personnel. I still remain sceptical about the remit of the "think tank that can't think", but I don't question the First Minister's sincerity. Maybe this report will be picked up there, who knows?

It's another report that, as Prof. Dylan Jones-Evans bemoans on Click on Wales, largely went under the radar. In all honesty though, it's incredibly hard to make reports like these interesting for the media or relevant to the public - even if said reports are excellent or important.

If posts like this get picked up by other people who have a bigger audience, or make people understand things better - great, I've done my job. That rarely happens as I'm preaching to the choir. I have the luxury of being able to do that, though – the mainstream media don't. But isn't that the problem in the first place?

And, "Doing the wrong things better" is the best summing up of Wales since devolution I've ever come across.