Ensuring value for money in government policy

Why Value for Money (VfM) in public policy is important, and why evaluation is critical for ensuring it 

Impact evaluation tells us the extent to which a policy or programme has delivered its outcomes and objectives, relative to what would have occurred in the absence of that programme. This impact provides a value to society, which can then be weighed against the costs of the programme. 

 VfM evaluation can show ‘what works’ in delivering policy impact, whether impacts justify programme costs, and what improvements can be made in design or delivery to increase impact and/or VfM. Identifying which programmes and policies generate the most value for money can guide spending decisions, drive learning, and provide accountability to UK taxpayers, ensuring their money is invested wisely.   

The importance of systematically embedding Value for Money evaluation throughout the policy cycle 

Evaluation should not be left as an afterthought and is a crucial part of good governance. Whilst evaluation after an programme has ended is important, VfM can be enhanced if evaluation scrutiny is brought in at the design stage, by ensuring an intervention is underpinned by logically sound and evidence-backed impact pathways, and during delivery, to enable adaptive management and course correction. An independent evaluation further promotes VfM by providing a robust and impartial judgement on how well a programme is working through baseline, interim and endline assessments. To maximise VfM at a departmental level, the evidence of the impact and VfM of individual policies should be systematically synthesised, reviewed and used to guide future policymaking decisions.  

Is cost benefit analysis the answer?  

Value for money and cost benefit analysis are sometimes used as if they are synonymous. This is not the case. Cost-benefit analysis is certainly a useful way to assess a policy, but does not provide the full picture. Whilst some benefits are easily quantifiable, other positives that may emerge from an intervention are challenging or in some cases impossible to quantify. Being unquantifiable does not make certain outcomes any less valuable.   

A new approach to VfM evaluation: Value for Investment 

Julian and Alex have pioneered a new, multi-disciplinary approach to Value for Money evaluation, Value for Investment (VFI).  This approach brings together best practice from both evaluators and economists and is gaining traction across policy areas both in the UK and globally.  

A Value for Investment evaluation can incorporate a standard cost-benefit analysis but also involves several more inputs, making it a substantially more holistic evaluation. In this approach, value is defined as the merit, worth or significance that people and groups place on something. They might place value on monetary and non-monetary resources, efficiency, outcomes and equity.  

Report-card style rubrics are fundamental to VFI evaluation. Julian outlines the process of creating transparent rubrics in which criteria are mapped against standards. The process of rubric creation is designed to be collaborative and inclusive, co-defining value with stakeholders to support evaluation validity, credibility and use. Multiple streams of evidence are integrated into make a transparent judgement about the Value for Money of a given initiative.

The Evaluation Task Force 

The UK government increasingly recognises the importance of value for money evaluation in policymaking, including the VFI approach specifically.  

The evaluation task force is a joint Cabinet Office-HM Treasury unit set up in 2020 with a mission to address a longstanding challenge in government; that decisions makers are forced to make tough decisions with very little evidence. By improving the quality and quantity of policy evaluations, the taskforce helps ensure that when policy makers are making decisions about what to spend taxpayer money on, these decisions are based on the best possible evidence about what is good value for money. 

With this goal in mind, the taskforce has set up the evaluation academy to train civil servants. The VFI approach discussed in this webinar is included within this training and is recommended as best practice for value for money evaluations. 

The taskforce has created an online registry where all evaluations of government initiatives are published. This will be publicly launched next year and will help to boost transparency, openness and public trust in policymaking.  

Innovation in Evaluation Practice is embraced 

The UK Evaluation Society also welcome the broader focus that the VFI approach takes, focusing on value beyond that which is monetisable. UKES runs a course which teaches the VFI approach in more depth. It is extremely popular, regularly selling out far in advance. UKES has connected Julian and Alex directly with various government departments as part of its charitable mission. These departments have been given bespoke, in-house training in VFI, which they see as highly relevant.  

Rethinking ‘value’ 

Overall, a key challenge to the evaluation and policy community is to understand what ‘value’ really means to a programme, intervention or policy. As such, Kirstine recommends “making the important measurable, and not the measurable important”. It is crucial to consider the broader value a programme or policy is bringing rather than focusing only on the easily quantifiable. Taking a Value for Investment approach can make this happen.  

Watch the webinar

Our webinar, Ensuring Value for Money in government policy- why routine monitoring and robust evaluation are crucial to achieving VFM, marked the launch of Verian's Centre for Value for Money (VFM) and our recently published Verian Guide to VFM Evaluation.

The session, in partnerships with the UK Evaluation Society, dived into why routine, robust monitoring and evaluation are critical to ensure value for money in government policy. Our speakers explored a framework designed to bring clarity and rigour to VFM evaluation.

You can watch the webinar on-demand here.

Speakers:

Alex Hurrell, UK Head of Evaluation at Verian, leads the continuing growth of Verian's end-to-end evaluation offer with UK government and public realm clients. Alex has deep expertise in leading large scale, complex projects specialising in Monitoring & Evaluation (M&E), Impact evaluation, Value for Money (VFM) assessment, and the design and implementation of effective Monitoring, Evaluation and Learning (MEL) systems to support programme accountability and impact across a wide range of public policy areas.

Julian King is a New Zealand-based public policy consultant, specialises in evaluation and VFM and developed the VFI approach through his doctoral research. Together, Julian and Alex recently co-authored a guide on VFM evaluation in UK public services, featuring an overview of the VFI approach. 

Dr Kirstine Szifris is President of the UK Evaluation Society. She took on the role in December 2023 and has been overseeing the organisation's transition to charitable status. She is currently working as a Principle Research Officer in the Civil Service, having previously worked in evaluation in the third sector and in academia. Kirstine is a criminologist by training with a PhD from the Institute of Criminology, Cambridge, and most of her evaluation experience has been in and around the criminal justice system. Kirstine is delighted to be President of UKES and is looking forward to seeing the organisation grow and develop over the coming years. 

Lucie Moore is the Head of the Evaluation Task Force, a joint HM Treasury and the Cabinet Office unit. She joined the Task Force at its inception in 2021, initially serving as an Evaluation Lead and Deputy Chief Social Researcher for the Cabinet Office. Prior to this role, Lucie was an Evaluation Advisor at the Foreign, Commonwealth & Development Office. Before entering government, she conducted evaluations, including randomised controlled trials, of social policy programs, primarily focused on public health, in countries such as Nigeria, Zimbabwe, Jordan, and Bangladesh.