This paper shares ideas on a long overdue revolution in public finance to better meet the needs of the early 21st century.
I show the strengths and weaknesses of current models of public finance, that are primarily concerned with managing money, and raising it, rather than ensuring it achieves outcomes; I suggest some of the emerging priorities for innovations in finance in relation to evidence, innovation and impact, as well as public engagement; and I offer proposals on what a different landscape of public finance could look like, building on practical work Nesta has been involved in with governments around the world.
The UK is swinging from a decade of financial austerity to what looks set to be a surge of public spending. Yet, while politicians are promising much more spending of all kinds, there is little sign of interest in how the money should be spent well. That risks not just waste, but also a wasted opportunity to modernise how public finances are organised.
Here I address:
I show various projects that are demonstrating how money could be used better, some quite mature and some at an early stage. Some of the suggestions build on my experience working in governments, and some on Nesta experience, including our practical work.
The paper also draws on some of our research, including our recent report on public value which brought together detailed analyses from fields as diverse as healthcare and the arts. The aim is to encourage more serious approaches to reform so that money can achieve more.