The UK needs a radical new approach to how government works, according to a major new report published today by the innovation charity Nesta and Public Digital.

The report recommends moving away from the UK government’s decades-old focus on large programmes and projects. In its place would be a model of testing and learning, with government structured around services and missions.

The report highlights the extent to which old methods of government are failing. It notes that according to data from the Infrastructure and Projects Authority (IPA), the UK government is currently running 244 major programmes with an estimated whole-life cost of £805 billion. They include major national projects on technology, military hardware and public service reform.

Just 26 out of 244 major government programmes are rated green. Among the live projects, 23 are rated red, meaning successful delivery appears to be unachievable. The red projects have a combined value of nearly £100 billion.

According to the report:

That leaves 195 programmes rated ‘amber’. That means 80% of the government’s biggest tasks are in a position where nobody knows for sure whether the programme will be a success or not - not the programme team, not the independent assessors, and certainly not ministers.

The report cites the example of the Green Deal as a major failure of the programme approach to delivering large projects. The energy efficiency scheme cost taxpayers £240 million but according to the National Audit Office did not generate energy savings and failed to persuade householders that efficiency savings are worth paying for.

According to the report failures such as the Green Deal are due to the chronic separation of policy and delivery. Little attention is paid to how a policy will be delivered in reality and many expensive initiatives fail because they have been insufficiently stress-tested or iterated before exposure to the public.

This step by step process, sometimes described as ‘waterfall’ in homage to the Gantt charts that govern it, is still typical of major government programmes. In practice, it means placing huge bets on the assumptions made at the policy stage. Yet this is almost always the moment where the least is known. The small error can snowball into a catastrophic mistake at delivery time.

The report recommends a move to multi-disciplinary teams to design, test and deliver major policy and infrastructure. The goal is to create rapid feedback loops where teams test the policy with small segments of the target population, making changes accordingly, before rolling it out more widely. The report points to policies that have successfully been delivered using a ‘test and learn’ approach, including the Future Farming and Countryside Scheme and the redesign (if not the funding) of Universal Credit.

The report sets out a plan for shifting government “from an organisation of programmes and projects, to one of missions and services”. The prize, according to the authors, will include better outcomes, reduced risk, less waste, and higher public trust.

The report recommends ten reforms to enable this change including reform of government procurement, more effective oversight of projects, improving public scrutiny and transparency and investing in civil service capability.

James Plunkett, Chief Practices Officer at Nesta said: “It's increasingly clear governments are struggling to cope with the pace and complexity of today's biggest problems. The idea of mission-oriented government is to adopt more responsive ways of working, more focused on outcomes. But there's also a risk that the language changes while the machine rumbles on. To get this right we need to embrace some quite radical changes to how Whitehall functions - moving away from a world of projects and programmes to one of services and missions.”

Andrew Greenway, Co-Founder and Managing Director of Public Digital said: “Without radical change to the way Whitehall works, there is a real danger that we will see more failures on the scale of HS2, which not only waste huge amounts of taxpayer money but also mean essential public services aren’t delivered to an acceptable standard.

“To prevent Government programmes from crashing and burning, and to build a state which meets citizens’ needs and is fit for the 21 st century, we need to see a radical step change in the way Ministers and officials operate.”

The report was commissioned by Nesta for its UK 2040 Options project. UK 2040 Options addresses the defining issues facing the country, from tax and economic growth to health and education.

Join us on 5 March for a discussion with @instituteforgov expert panel, about what mission government really means for UK politics. https://www.eventsforce.net/nesta/236/home

About Nesta

We are Nesta, the UK's innovation agency for social good. We design, test and scale solutions to society's biggest problems. Our three missions are to give every child a fair start, help people live healthy lives, and create a sustainable future where the economy works for both people and the planet.

For over 20 years, we have worked to support, encourage and inspire innovation. We work in three roles: as an innovation partner working with frontline organisations to design and test new solutions, as a venture builder supporting new and early stage businesses, and as a system shaper creating the conditions for innovation.

Harnessing the rigour of science and the creativity of design, we work relentlessly to change millions of lives for the better. Find out more at nesta.org.uk

About Public Digital

Public Digital is a consultancy that works with international organisations, governments, and large companies to deliver strategic change at scale. It was founded by the team that created the UK’s Government Digital Service (GDS) which led the pioneering digital transformation of the state and public services in the 2010s.

We advise governments globally on strategy, scaling teams, designing and delivering better services, and aligning senior stakeholders around the potential of better government.