In the wake of the global financial crisis, the U.K. government has set out plans to rapidly reduce public spending, leading to unprecedented budget cuts of up to 30 percent in some areas -- most notably in local government, justice and welfare.
How officials in the U.K. respond to these challenges will define our future.
Our current tools for saving money -- operational efficiencies, streamlining or stripping back aspects of a service -- cannot on their own deliver the level of savings necessary.
Rather than looking to tweak existing services, the crisis in public finances should prompt new ways of thinking about how services can be better at meeting people's needs for less money. Looking at it this way, the problem becomes an innovation challenge: How can we harness the full range of resources available to meet our social and public needs? Though it may seem counterintuitive, it makes sense to start by thinking about how services can be better, not how to save money.
Putting the focus on cuts limits our thinking in terms of innovation. Rethinking the outcomes services seek to achieve can help us to realize the dramatic improvements the fiscal context demands.
At the National Endowment for Science, Technology and the Arts (NESTA), we believe that innovation in public services will be critical to a brighter future. Our research and practical work -- such as our recent report, Radical Efficiency, with the Innovation Unit -- looks at a number of innovative public entities and social enterprises that are developing better and cheaper ways to address social issues.
Though wonderfully varied in their interventions, there are some principles that we see consistently driving innovation: Working with service users to really understand problems being addressed; finding new ways to tap into the resources within the community; and drawing on new media tools to deliver services in different ways.
Working closely with service users to understand their needs can prompt service transformation, as Sunderland City Council found when they reformed their unemployment services in the North East of England. In 2007, 26 percent of the working age population in Sunderland was economically inactive. The council was spending a significant amount on potential solutions like a local job center and benefit claims, with little progress.
Sunderland hired a team to spend time with service users to understand the challenge of worklessness, and quickly learned that the service was inadequate for the complex journey back into work. Based on these insights, the new suite of services included mentoring, peer support and connections throughout each stage of the journey back to work, helping more people to start and sustain employment. It helped the council avoid costs and save over 50 percent of their average expenses.
Tapping into existing resources within the community can often unlock a wider range in service delivery potential. For example, service recipient's have time, skills and existing relationships such as families and friends that often get overlooked. Other community assets, including physical space and information about local norms, can be leveraged to address social issues. One innovative tool is the use of "timebanks," a mutual volunteering exchange that enables people to swap skills and support.
The timebank approach began in the U.S. (take the successful Time Dollar Youth Count in Washington, D.C., for example), and is now used in some U.K. public services to access latent resources. The local general practitioner (GP) practice in Rushey Green in South East London, for example, integrates a timebank to reward voluntary help in the practice and as a referral route for peer support and activity. The timebank has helped GPs manage their administration costs, and crucially, has helped patients to respond to their own and others' low-level mental or physical health conditions through increased social interaction and activity.
Technology will also play a key role in innovation. The Internet, social media tools and sharing platforms open up the potential for different models of public service delivery. Southwark Circle is a social enterprise that is using social network tools to provide care for older people. By building a network of social support amongst older people, the Circle offers its members help with their day to day lives. Whether fixing a light bulb, picking up a prescription or just a friendly conversation, the online tools facilitate real world support and care that has a positive impact on public spending and people's experience of services.
It's vital that we keep a relentless focus on how innovation can be a practical answer to real problems. This isn't about making incremental changes to existing approaches, but asking more fundamental questions. In health, how can we stop people needing hospitals, or start to receive more care at home? In justice, how can we support prisoners to stop re-offending and build more stable lives? In social care, how can we help people to age well and maintain strong relationships into later life?
These are challenging times, but that shouldn't preclude innovation. Indeed, the best way to make savings in public services is to think more creatively about what you're trying to achieve, and what resources you can use to get there.
