A week is a long time in politics, as the creaking old adage goes, and this week has thrown together a number of stories that may or may not be related.

First, Mr Darling's debut budget was something of a winter bear: chilly, cumbersome, mysteriously black-browed, aggressive (in a honeyed sort of way), and covered in venerable white hair. Darling downgraded growth forecasts (most commentators felt not enough), while offering the drowsily optimistic outlook of a bear who has woken from hibernation, only to be buried by a snowdrift .

Darling's uniquely ambivalent brand of optimism may come back to haunt the Chancellor, as if a mild recession hits next year, then his election-year budget speech will have to be a miracle of figure-juggling and face-saving PR. Of course, optimism becomes academic should further financial institutions run to the Bank of England with their bowls empty. But I digress.

We also found out that Darling is a fan of the SME sector – as are we, but major IT suppliers are not, as it is so difficult to sell into. The Chancellor said he would look into the practicality of setting a goal for small and medium enterprises (SMEs) to win 30 percent of all public sector business in the next five years, which must be good news for businesses hit by the credit crunch here and in the US.

Next, a brace of reports found the UK brimming with innovation as the key to future prosperity, in the Government's estimation. Innovation Nation was the blue-sky thinking, while Implementing 'The Race to the Top' was Lord Sainsbury's review on the progress of Government science and innovation policies to date (good – according Sainsbury).

Once again SME innovation is fanfared as the great and golden resource.

The Innovation Nation white paper spells out how the Government creates demand and new markets through £150 billion in public spending on goods and services, and goes on to set out a number of practical measures to keep innovation at the heart of the UK.

Jumping into bed with innovation

Included here is a commitment for each Government department to publish an "innovation procurement plan" as part of its commercial strategy. This will specify how departments will 'embed innovation' at the heart of procurement practices, encouraging them to "engage with businesses at an early stage".

(Politicians and business executives now sound so alike it is hard to avoid the impression that many MPs see politics as a stepping stone into a lucrative consultancy career. Presumably many will jump sooner, now the public has got wind of all the free John Lewis kitchens and soft furnishings they have been able to claim for.)

Innovation Nation was published with the input of, among other industry figures, Anne Glover, the Brit-American CEO of venture capitalists Amadeus Capital Partners Ltd, and Iain Gray, CEO of the DTi's Technology Strategy Board (which Glover is also a member of).

Gray said, “Working closely with partners, our initiatives and investments will make new connections and act as a catalyst for new areas of business innovation, making a real difference to the prosperity and global competitiveness of the UK.”

Glover, a longstanding and successful expert in private equity investments, has been asked to investigate SMEs' potential role in the strategy. She added: “Many small businesses are highly innovative, and by taking account of innovation in the public procurement process the Government can achieve both value for money and greater engagement with SMEs.”

Is the Government playing venture capitalist?

So what does all this mean? There are several possible explanations, and like many of this government's most ambitious plans, many seem to risk making perilous ethical and strategic back-flips in the pursuit of 'modernity' and inclusiveness.

For example, should Government contemplate becoming a test-bed for 'hot' new ideas and technologies, influenced by an investment culture that is driven by fad and fashion? E-procurement was touted as a cure-all a decade ago, but where are all those companies today?

Alternatively, is the Government actually suggesting it backs or even underwrites innovative start-ups – a strategy that sounds similar to the many venture capitalists in the market who back start-ups, run them at a loss, and then sell off the IP to the highest bidders?

Or is it contemplating informal alliances with (unnamed) venture capital funds with a promise to be a customer of any idea it likes – providing the capital is pumped into the company by private backers? I know the Government is now running a bank, but...

Of course, anyone who writes about Government and bureaucracy knows that for every conspiracy theory, the more likely explanation is simple incompetence and bureaucracy. This begs the question as to why ambitious SMEs and intelligent start-ups might want to become the innovation arm of a slow-moving Victorian bureaucracy (not that lucrative Government contracts would be anything to sneeze at – but what strings might be attached in a new SME-centric procurement model?).

Nevertheless, this possibility does remind me of a paragraph in the recent book The Shock Doctrine, by journalist Naomi Klein. This is Klein's exposé of Milton Friedman-esque 'disaster capitalism' (her description), within which she sets out her belief that like-minded governments are increasingly becoming small, profit-generating enterprises exploiting opportunities (war, terrorism, natural disasters) around the world to pursue private-enterprise expansion.

One of the hallmarks of this form of "fundamentalist capitalism", she writes. is that: "The role of the government... is not that of an administrator managing a network of contractors but of a deep-pocketed venture capitalist, both providing its seed money for the complex's creation but also becoming the biggest customer for its new services."

NHS savings?

Which brings us to the next major story this week for our industry: the NHS. The new IT systems in the NHS are on course to deliver better care and an estimated £1.14 billion in savings by 2014, according to the first annual benefits statement published by the Government.

Excellent news again, but I imagine the Government's new VC advisers might baulk at the prospect of £1.14 billion savings in 2014 from a system whose overall cost is estimated to be £12.4 billion by 2012.

Could this be why the Government is now so fond of the SME sector?

The other story that caught my eye was UK business leaders saying (I paraphrase) “we're going to hell in a handcart, but we don't know how to work the brakes”. You'll find that little gem in our News analysis section.