A wide range of indicators suggests that UK innovation performance has been mediocre in international comparison. An improvement is often viewed as one important means of closing the productivity gap with the best performing countries. This chapter assesses the appropriate policy response in the context of the government’s ten-year plan to boost innovation performance. There are reasons to be optimistic given favourable framework conditions, a strong science base and recent changes in innovation policy. At the same time success should not be judged solely against conventional indicators, which often poorly reflect innovation in certain sectors such as knowledge-intensive services, in which the United Kingdom has shown considerable strength.