How Wales can lead in public service change

Dylan Jones-Evans discovers that we are big enough to scale beyond the local but small enough to adopt an innovation strategy

Last week, a report was published that, woefully, received little attention from the Welsh media. However, if implemented, it could have a transformational effect on the way that public services are delivered in Wales.

State of Innovation: Wales Public Services and the Challenge of Change should be compulsory reading for every senior manager within government and the public sector in Wales. Authored by Matthew Gatehouse and Adam Price, the facts from the Nesta-funded report are startling.

More than two thirds of our economic output comes from the public sector, a situation that is compounded by low private sector productivity, which means Wales remains the poorest part of the UK.

Nearly a fifth of the Welsh population is aged over 65, which is a higher proportion than the UK as a whole, putting pressure on an already stretched health and social care system that will only increase as life expectancy improves.

Pockets of Wales, especially in postindustrial areas, have some of the worse health of any parts of the UK, with 27 per cent of economic inactivity due to long-term sickness. In addition, we also have higher comparative levels of child poverty.

Whilst in the past, governments have dealt with such issues by merely throwing money at them in the good times, that scenario is now at an end. Welfare spending is set to fall dramatically over the next few years and the funding that the Welsh Government receives from the Treasury will continue to reduce.

In the past, such government cuts have been accepted with largely a shrug of the shoulders, some industrial action but then a quiet acquiescence that we might as well accept it as there is little that can be done ‘in the current circumstances’. However, this report blows that comfortable complacency out of the water by showing that stronger and healthier communities can be created if we embrace greater innovation within the public sector.

And we already have some strengths in place. According to the report, Wales is big enough to scale beyond the purely local but small enough to organise a coherent national strategy.

Indeed, a radical programme of transformational change is possible because of this ‘Wales effect’ – that  is, the common sense of belonging, the strong personal relationships between the main players, the much shorter communication distances between national government and local delivery, and close connections between policymakers, practitioners and academic institutions.

This natural advantage, along with a dominant public sector, a strong academic base and close communities, means that there is a real opportunity for Wales to become a global leader in public service innovation.

And it is not that we are beginning from scratch.

There are already several cases of excellence of innovation within public services in Wales, including the “Your County Your Way” strategy led by Monmouthshire County Council; Time Banking Wales which is transforming local engagement in the South Wales Valleys; and the Gwent Frailty project which, as a partnership between five local authorities, Aneurin Bevan Health Board and the voluntary sector, is reshaping services in primary and community care around the care needs of people.

But despite such examples, there is more that can be done to ensure such innovation does not remain within isolated areas across the nation but becomes a normal part of the delivery of public services in the future.

There is also the opportunity to incentivise new partners in the private sector, such as technology providers, to turn Wales into a global test bed for those wishing to develop innovative solutions via digital technologies in areas such as health and education.

This of course, will require acceptance of greater risk within the public sector where innovation and accountability can go hand in hand, and failure is a chance to learn from mistakes rather than an opportunity to apportion blame when something goes wrong. With a new Permanent Secretary who, in his public statements so far, embraces such a culture, the Welsh Government could be leading such change across the public sector in Wales.

But it is not only the public sector alone itself that can make a difference to this agenda. For example, with the creation of a new University of South Wales, there is an opportunity for this institution, with its roots in some of our most deprived communities, to become a catalyst for change in driving forward innovation within public services in Wales. It has a chance to make innovation skills centre stage in management and leadership programmes in order to create a new cadre of innovators across Wales’ public services.

There is also a greater role that can be played by the third sector in Wales, especially in the creation of new social enterprises that can help deliver local services around their communities in a far more efficient way than many public bodies. Indeed, could the current review of mutuals and co-operatives by the former minister Andrew Davies herald a seismic shift in the way some public services are delivered in Wales?

In 2011, the economist Gerry Holtham wrote in an article in the Western Mailthat instead of bewailing the fact that our public sector is too big, why don’t we make virtue of necessity? As he noted at the time, whilst industries rise and fall, there will always be a need for good government in every part of the World.

Professor Dylan Jones-Evans is Director of Enterprise and Innovation at the University of Wales and Chairman of the Welsh Conservatives' Economic Commission.

6 thoughts on “How Wales can lead in public service change

  1. Why no mention of a public Bank of Wales, which could solve most of these issues in a short space of time?

  2. Interesting, though not encouraging, to see that Dylan Jones-Evans has completely omitted to mention the current debate on the possibility of a Welsh public bank aimed at real economy (particularly SME) and infrastructural funding: it is only to be hoped that this oversight is only a product of the current stage of Prof. Jones-Evans research for Edwina Hart and the Welsh Government, rather than the donning of intellectual blinkers due to an ideological opposition to public sector financial institutions in general.

    Given the problems of securing adequate finance for business in Wales it would be unforgiveable to single-mindedly pursue ‘innovation’ alone, important though this is, at the expense of a thoughtful consideration and analysis of existing models internationally (though models from the EU would be a good start) which provide examples of success of publically owned financial instutions operating in a socially useful way (this obviously excludes RBS and Lloyds TSB in their current forms, though they could potentially form the basis for new public banks with such a positive social purpose). The current financial crisis was after all, rather than being a pure ‘Black Swan event’ as is so frequently claimed, principally the product of the seeming forgetting (or willful denial) of previously ‘known knowns’ of economics and finance by policy makers over the last 30 years, in the form regulatory and structural ‘innovations’ which flew in the face of all the lessons of economic history, with predictably catastrophic results. It is only to be hoped that we will not make the same mistakes in Wales as we look for viable solutions to our economic malaise at a national level, as to do so would be no service to the nation we all love.

  3. What is required is a change of culture rather than yet more changes of structure. Someone should dust off the relevant chapters of the Institute of Welsh Affairs’ own ‘Wales 2010’ Project from the early 1990s. It is sad to reflect that we have made so little progress since then – indeed, in some respects, Wales has regressed. Part of the problem is too much deference to power and too much jargon, but not enough to disguise a lack of both imaginative thinking ‘outside the box’ and specific ground-level ideas.

  4. Wales has never been afarid to innovate or lead the way. There are countless examples in both the public and private sector. When it comes to public sector innovation I am left with the question, who will be afford this sort of committment to advances and improvements?

    The issue raised by the other comments is valid in that any credit raised by the Welsh Govt will likely lead to the paying of interest outside of Wales. This will result in the net extraction of wealth from the Welsh economy meaning we will be losing our capacity to make the improvements we need over the longrun.

    The alternative would be to have a public banking system in line with 40% of the world working alongside the private system with the advantage of a public bank being able to take a longterm approach and to look at funding the public sector for innovation. At least if the lending was from a Bank of Wales the liquidity would be recycled back into Wales rather than leaking out of it.

    Public banking fits neatly with a shift towards a collaborative economy as well as cooperatives and mutuals. If we are looking for sustainable innovation for Wales then a system of public banking able to finance the need for credit for research, technology and training must be part of the conversation.

    This would perhaps be the greatest innovation of all for Wales and if done correctly it will complement private banking offering an alternative to the profit motive model ensuring that we place ‘value’ on that which may not generate massive gains at the expense of others. Wales should be looking for a system where we are not just moving the numbers around but where the credit and investment reflects the values of Wales, where we can grow without goingfurther and further into debt to an institution that is external from our nations people.

    Being small enough to innovate and align our incentives approrpiately does offer Wales a vital opportunity and the hope is that all with Welsh interests at heart will join in this discussion to help the development of innovation strategies without the neccesity of debt.

  5. John – a useful and timely comment.

    I was reading the Wales 2010 report only recently and fondly remember the many conversations I had with the late Gareth Jones about its contents. It had clarity, vision and a sense of reality so often missing from such documents. A Wales 2020 document would be most welcome, as long as there was political courage and consensus to push it forward.

    As for the earlier comments about the public bank: the potential creation of that institution is not mentioned at all in the report by Matthew and Adam so if you have an issue about its exclusion, take it up with them!

  6. Yes, a ‘Wales 2020’ could do a lot of good. I remember ‘Wales 2010’ with great affection as one of the most intellectually stimulating experiences of my life. All sorts of ideas were coming in from all over the place – left, right, and centre – and were discussed by bright young people who shared a real optimism about the potential of Wales, even if they had different reasons for that optimism. It all would have been impossible without Gareth Jones, his energy, his open-mindedness, his passion, and his networking abilities. The man had more fizz than a bottle of pop! Is there anyone around in Wales these days who could do what he did and drive a ‘Wales 2020’?

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