Performance Auditing and Public Sector Innovation: Friends with Benefits or Strange Bedfellows?

Today, "innovation" is increasingly seen as a primary dimension of improving public sector performance. "Performance auditing" is, in turn, a widespread activity that seeks to enhance the performance of public sector organisations. This article examines intersections between the performance auditing process and public sector innovation. After presenting simple models of the audit process and the innovation system, the article considers the plausibility of performance auditing's improvement aspirations. The article then briefly considers performance auditing in the Australian state of Victoria and concludes that, while the circumstances in which performance auditing can spur innovation may be limited, there is cause for cautious optimism about performance auditing's value in this regard.