When the UK coalition government was formed in May 2010, the new prime minister, David Cameron, translated his enthusiasm for the theory of behavioural insights or ‘nudge’ into reality. He helped set up the Behavioural Insights Team at the centre of government, and encouraged them to innovate and create policy initiatives based on their theories of influence and persuasion.
Governments’ policies have often been seen as too prescriptive, trying to direct citizens to act in a certain way – with limited success – rather than persuade them to modify their behaviour through subtle influencing. The latter approach “was made popular by US professor, Richard Thaler, who co-wrote the 2008 book, ‘Nudge’ with Cass R. Sunstein, and is an adviser to the UK team.”  It was a view that had some traction with the UK’s coalition government, and it was adopted as an important plank in their reform of public services.
The Behavioural Insights Team (BIT) – commonly known as the “nudge unit” – was set up by the coalition government in July 2010.  Its aims were, and remain:
- “Making public services more cost-effective and easier for citizens to use.
- “Improving outcomes by introducing a more realistic model of human behaviour to policy; and wherever possible,
- “Enabling people to make ‘better choices for themselves’.”
The detailed approach is that “a small team of psychologists and economists apply insights and methods from behavioural science to the design of policies, demonstrating how small changes to the context in which people choose can have a dramatic effect on behaviour.”  The objective is to find low- or no-cost interventions that can have a rapid and significant impact.
The BIT’s process “follows four distinct steps :
1. Understand the system in question, e.g., how Her Majesty’s Revenue and Customs (HMRC) collects income tax, to identify the outcomes of interest and relevant behaviours.
2. Build your insights around why these behaviours occur and ways to change them, e.g., make a process easier or more social.
3. Design the intervention.
4. Test and adapt the ideas using randomised controlled trials where possible.”
It is the BIT’s contention that the basic principles of this process can be applied to many domains and systems, from tax collection to criminal justice.
The public impact
Over the past two years, the team claims to have identified public savings of at least £300 million:
- Improving tax repayment rates has already generated £30 million of extra revenue annually.
- The use of text messaging has reduced by 150,000 the number of repossession interventions by bailiffs, also saving £30 million.
- The addition of 100,000 people to the organ donation register.
- Persuading 20 percent more people to consider switching energy provider.
- Doubling the number of applicants to the British Army.
David Halpern, the CEO of the BIT, cites the collaboration with the UK’s network of job centres as a key source of pride. “The project was underpinned by the insight that encouraging claimants to make specific commitments to future activities, linked to their daily routines, helps them follow through on their job search intentions. The success of the pilot scheme has led to the retraining of 25,000 job centre advisors and the approach is now implemented in every job centre, with hundreds of thousands of claimants already benefiting.” Have an idea for a case study? Print
What did and didn't work
Stakeholder Engagement Good
The prime minister, David Cameron, approved the creation of the BIT within government (specifically the Cabinet Office) in the summer of 2010 and was the senior political figure most closely associated with the BIT. The Civil Service as a whole is an important stakeholder, and many of its members are trained in the theory and practice of behavioural insights.
Political Commitment Strong
It was initiated by the newly-formed coalition government. It had strong political support and was well funded. It was also well as integrated with a broad spectrum of government departments covering a number of important policy areas.
Clear Objectives Good
The objectives of the team were clearly defined at the outset but were not measurable. The objectives were also well aligned with the government's target of reducing the public debt.
The unit still gets most of its work from the UK government, although it has expanded to take on a wider range of projects, including work for foreign governments, the World Bank and the UN.
BIT was founded in part on the existing theory of behavioural economics, principally developed by Daniel Kahneman and Amos Tversky. The prominent academics, Cass Sunstein and Richard Thaler then developed the field of behavioural economics and combined it with findings from public policy and psychology to develop behavioural insights. These developments were set out in the 2008 book ‘Nudge’ (see above). This work became required reading for many in the Conservative opposition, including David Cameron, who adopted many of its theories.
Following the ascension of the Conservative led, coalition government in 2010, David Halpern was asked to help set up a new team. From here, BIT was formed on a probationary basis, with the objective of using findings from behavioural insights to positively shape government policy and save the government money. Key to this initial period was a ‘sunset clause’ with detailed objectives, including demonstrating a ten-fold return on investment and transforming two major areas of policy, to be achieved before a review in 2012. The Cabinet Secretary and then Prime Minister concluded that, on the basis of the team’s success, such as achieving a thirty-fold return on investment, it should continue to operate. Subsequently, BIT was spun out of government as a part-private mutual venture.
The BIT has been led right from its inception by David Halpern, who served as the chief analyst at the prime minister's strategy unit before becoming CEO. The BIT members have either a strong academic grounding in economics, psychology or randomised controlled trial design, or a background in government policymaking. Its initial location in the Cabinet Office meant that it was given the authority and independence to manage its own affairs, but also had access to the management teams at the centre of government.
Wherever possible BIT uses randomised controlled trials - widely considered the gold standard of evaluative techniques. Where these are not possible BIT strives to use other quasi-experimental techniques. As a result, the outcomes of the BIT’s work are measurable, for example:
- The number of new people applying for an initiative, such as organ donation or a recruitment exercise for the army.
- A change in tax revenues generated through behavioural changes initiated by the BIT.
- The increase in the number of jobseekers finding work as result of applying the BIT’s approach.
The BIT is working with different government departments and delivering successful results across growing range of policy areas, such as education, healthcare and employment. The CEO, David Halpern, has said that he has received considerable support from political and administrative stakeholders and this support has been maintained: “It was fantastic that we were able to assemble the right mix of political and administrative support. This bedrock of support has never wavered, perhaps because the results were so positive.”