Encouraging innovation would enormously advantage Gov 2.0 initiatives, as they are largely innovative endeavours.
Similar to the efficiency dividend, government could mandate that government departments allocate a percentage of their spending towards innovation-focused initiatives.
The danger with this approach would be that these funds would be channeled into activities which are not genuinely innovative.
To help prevent this, a percentage of ongoing departmental funding could be attached to successful demonstration of innovation - whether successful or not.
REF: My submission to the Gov 2.0 Taskforce - http://gov2.net.au/submissions/craig-thomler/