Headlines: October 24th, 2006



‘What gets counted gets done’ does not hold true as far as innovation in the public, voluntary and not-for-profit sectors is concerned. Innovative developments remain hidden under current measures which focus on a narrow range of indicators. According to a new report from the National Endowment for Science, Technology and the Arts, the innovation gap between the UK and innovation leaders such as US, Germany and Japan is largely the result of a focus on too narrow a section of the economy, namely science and technology expenditure and patent production. This measurement takes no account of innovation in areas such as social housing.

The Association has called for a broader approach to measuring and stimulating innovation that encompasses the public and not-for-profit sectors. It has set out a challenge to identify and exploit this “hidden innovation,” particularly in services, the public sector and business processes. Doing this will require a broader view of what drives innovation and of where innovation matters.

The public and non-profit sectors represent a considerable part of the UK’s economy contributing some 145 billion pounds, or 14 per cent, of the UK’s total ‘added value’. This is divided between central government 64 billion pounds, local government 61 billion pounds and public corporations 20 billion pounds.

The report ‘The Innovation Gap’ identifies developments in social housing as typical of uncounted innovation which has brought considerable benefits. The social housing sector is being transformed from one of the UK’s poorest performers into a dynamic innovative sector that is not only supplying high quality housing, but also exploits product and process innovation to address a range of environmental, social, crime, health, transport and urban regeneration issues.

Similarly the National Cycle Network, initiated in 1995 and which now comprises 10,000 miles of cycle routes throughout the UK, is a major social innovation. It was initiated by a charity – Sustrans – and taken forward largely in cooperation with the public and non-profit sectors. The Network challenges the predominantly private sector focus of innovation research. Private-sector involvement was largely confined to fulfilling contract work that had been conceived, planned and resourced by players in the public and charity sectors.

Link: http://www.nesta.org.uk/assets/pdf/innovation_gap_report.pdf