The Whitehall Innovation Hub: Innovation, Capabilities and Connectivity
ABSTRACTGovernment interventions are often expected to deliver innovation policies within unrealistic timeframes and their short shelf life is determined as much by elections as evidence. This is the story of one such intervention in the UK. Encouragingly, New Labour recognized public service innovation for the first time in 2008 and invested in a number of initiatives to support it, one of which was the Whitehall Innovation Hub (WIH).The WIH's task was to persuade policy-makers of their role in public service innovation. Its strategy was to work with innovation champions andto stimulate innovation demand by persuading Whitehall leaders that innovation was a matter of responsiveness and collaboration rather than diktat. This approach was closely aligned to the Cabinet Secretary's desire for civil service transformation and was endorsed by the Department of Innovation and Skill's Permanent Secretary and Minister in 2008.The account that follows demonstrates the significance of narratives about innovation and beliefs about how change can be implemented by administrations, which remain elitist and dominated by departmental fiefdoms. It also highlights the problems encountered by small(marginal) units within highly politicized environments. The Hub was neither inside nor outside of government, and its strategy was contested, although later accepted as pertinent once adopted by the Treasury and Cabinet Office.In May 2010, the Coalition Government was elected and public innovation policy changed dramatically. Austerity and ideology led to policies that focused on public sector savings and business growth with marketization as the driver of service innovation. The government has lost interest in the role capabilities and human connectivity in service innovation and the 'science to business' model of knowledge innovation reinstated.Key Words: Leadership, Public Innovation Policy, Practice and System AlignmentOriginIn 2007 the British government created the Department of Innovation, Universities and Skills (DIUS) to stimulate innovation and a more integrated policy approach to skills, higher education and innovation. Innovation Nation, the DIUS White Paper on innovation, was published in 2008 and for the first time the British government innovation policy made reference to public sector innovation.Innovation in public services will be essential to the UK's ability to meet the economic and social challenges in the 21st century. Education, health and transport provide the underpinning for all innovative activity. Demand is growing amongst public service users for more efficient service that are personalized to their needs (DIUS, 2008).Innovation Nation recognized the challenges of climate change, public health, ageing, etc. and demanded that those in policy-making become much more explorative and innovative in their problem-solving and initiate dialogue across government, the public sector and business sectors. The government accepted that it needed to stimulate innovation in all sectors and a demand for public service innovation within government. Innovation Nation recommended investment in intermediaries such as the Design Council and NESTA1and the Whitehall Innovation Hub. The WIH's role was to develop Whitehall's internal innovation capabilities and the demand for innovation side, while the role of the Design Council and NESTA would be to stimulate social innovation supply. Although the supply side of social innovation was strong, it lacked funding, government recognition and an infrastructure to sustain it. There was growing recognition that government policy-makers needed to be more concerned with innovation demand (Edler & Georghiou, 2007; Georghiou, 2007).The WIH was situated within the Sunningdale Institute led by Professor Sue Richards as part of the National School of Government [NSG], formerly known as the Civil Service College. Su Maddock was seconded from Manchester Business School to be the WIH Director on the basis of her experience in public leadership, public service innovation and knowledge exchange. …
Public Service Agreements
One of the most intriguing and indeed progressive features of the Labour government is its willingness to have itself judged against a wide range of targets, as set out in the Public Service Agreements (PSAs) which accompanied the Comprehensive Spending Review (CSR) in 1998. 
 
 
 
The second Comprehensive Spending Review due in summer 2000 will be accompanied by a revised set of PSAs negotiated between the Treasury and individual departments. This second round of PSAs will rightly concentrate on the key policy outcomes which departments are aiming to deliver. The several hundred targets which assess the managerial effectiveness of the government machine will be covered by a separate series of Service Delivery Agreements. However, ironically the remarks by the Prime Minister on health service funding appear to undermine the whole CSR process, and threaten to turn the debate back to a focus on how much money gets spent on the public services, rather than the welcome focus on outcomes implied by the PSAs. 
 
 
 
The PSAs in effect set out in detail the government’s strategy, which immediately raises the question of whether they should signal more clearly the government’s priorities across the many different policy outcomes. Several of the articles in this issue of New Economy focus on the key areas of policy which should be central to the agenda of a centre-left government: restoring full employment, eliminating child poverty and putting sustainable development at the heart of government strategy rather than at its margins. 
 
 
 
Matthew Taylor leads off by discussing the tensions which lie at the heart of the PSA process. Performance targets can have perverse outcomes if they are not designed carefully. The PSA process is highly centralising and may sti?e local initiative. It is not clear that modern government is best delivered by the Treasury telling everyone what to do. 
 
 
 
In an act of modest self-indulgence the editor contributes an article to this issue which argues that a commitment to the attainment of full employment alongside a commitment to eliminating child poverty would represent a really powerful and radical agenda for the Government. Less weight should be given to closing the productivity gap, which is less of a problem than usually thought. 
 
 
 
Lisa Harker takes up the issues raised by the government’s anti-poverty strategy noting the absence of any debate about which of the poverty indicators the government intends to track should be given priority. She also notes that adopting a clear measure of income poverty brings challenges for government, raising the question of how far it should explicitly address poverty through higher bene?ts to provide ‘security for those who cannot work’. 
 
 
 
The urgency of tackling child poverty is given weight by the chilling conclusion set out by John Micklewright and Kitty Stewart that on three key measures of child well-being – child poverty, children in workless households and the teenage birth rate – the UK’s performance is the worst in the EU. It is this ‘child poverty gap’ with our European partners which should make us ashamed not the productivity gap. 
 
 
 
Fran Bennett and Chris Roche argue for genuinely participatory approaches to the development of indicators of poverty and social exclusion which focus not just on what is measured, but also on who decides which indicators are important. This approach features heavily in debates in the developing world, but the OECD countries could learn from this experience. 
 
 
 
Chris Hewett and Matthew Rayment note discouragingly that seven major government departments made no reference to sustainable development in their aims and objectives as set out in the PSAs in 1998. By and large, the key environmental issues are still seen as only a priority for the DETR and no one else. It is not clear that any relationship between the PSAs and the government’s sustainable development strategy is evidence of joined up government or merely coincidental overlapping government. 
 
 
 
The original PSAs made little or no reference to the goal of securing greater racial equality and Sarah Spencer takes up this omission by looking at a range of areas of public policy where a focus on outcome based measures relating to racial equality are needed. The achievement of race equality objectives necessitates a contribution from each of the key Whitehall departments responsible for domestic policy, and from all departments in relation to their own employment practices. 
 
 
 
Damian Tambini discusses the ‘Ulysees Effect’ by which the announcing of targets amid great fanfare forces the government to nail its colours to the mast. In the area of electronic service delivery, targets have so far been quite successful in jolting government agencies into taking action. If potential problems relating to data protection and social exclusion do not emerge, targets in this area will be seen as a useful tool of radical modernisation. However, if the negative effects of electronic service delivery do become more severe, then the government will have to face some difficult choices: abandon the targets, fudge the ?gures, or push them through despite the negative consequences. 
 
 
 
Andrea Westall discusses four recently published IPPR reports relating to business or industrial policy. A common theme is that government has a role as a market maker and catalyst by bringing players together to encourage the formation of innovative solutions rather than intervening in a broad and possibly blunt way. This role requires an element of risk and ‘letting go’ rather than devising programmes with clearly de?ned outcomes and targets – somewhat anathema to the Treasury with its emphasis on performance targets as set out in the PSAs. 
 
 
 
Rebecca Harding looks at the establishment of regional venture capital funds, arguing that in the north of England the main problem may be the lack of demand for venture capital, so that it may not be the correct tool for supporting innovative small businesses in all regions. 
 
 
 
Robert Atkinson explodes some of the myths held about the emerging ‘new economy’. This includes the notion that technological change is destroying employment (preposterous when viewed against the tremendous jobs growth in the US economy) or that economic change calls into question the continued viability of large corporations or the role of the state. 
 
 
 
Finally David Osmon offers a different model from the government’s proposed public private partnership for achieving a more efficient London Underground. The combined infrastructure and operations of some underground lines could be leased to the private sector which could then compete with the publicly operated lines. If the private companies achieved efficiency savings they could then bid for further franchises and in the meantime those lines still in public ownership would be subject to competitive pressures to increase their efficiency. With all the uncertainty surrounding the current PPP this idea is worthy of consideration.
The Internet and the Changing Beijing-Taipei Relations: Toward Unification or Fragmentation?
Information and its technologies facilitate the exercise of what has been called “soft power,” a concept that differentiates information from the conventional dimensions of “hard power,” which is mainly associated with military force and economic influence. Soft power, according to Nye, a former Assistant Secretary of Defense of the United States, means that “A country may obtain the outcomes it wants in world politics because other countries want to follow it, admiring its values, emulating its example, aspiring to its level of prosperity and openness. In this sense it is just as important to set the agenda in world politics and attract others as it is to force them to change through the threat or use of military or economic weapons.”1