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The Value for Money Conundrum (Continued)

2011 September 5

Pressure for aid practitioners to demonstrate aid is providing value for money (VfM) is increasing. Although recent efforts, cialis sale such as research by students at LSE VfM Current Approaches and Evolving Debates, sovaldi sale  have done much to clarify elements of the debate, cialis and civil society actors are moving forward with position papers, uncertainty remains about how best to conceptualise VfM and demonstrate it.

Good news: areas of consensus are emerging.  Good management practice is believed to be key to achieving VfM. Many organisations already see the VfM agenda providing opportunities to improve: risk management procedures; procurement practices; monitoring and evaluation systems to enable continuous learning; and the integration of programmatic and financial information systems to produce management accounting data to inform resource allocation and other decision making. Some claim delivering VfM may require redefining costs to ensure the true costs of developing quality relationships required to deliver effective aid are adequately reflected. Finding ways to enhance cooperation between fundraising, programme, finance, marketing, M&E and communication functions are crucial.


But it gets more difficult. VfM is also understood to require some degree of measurement.  Benchmarks that inform ex ante appraisals of funding options have to be generated somehow. And although secondary data can be used for this purpose, most organisations perceive that they are going to have to develop evaluation methodologies and capabilities to produce valid quantitative data for ex post measurement of outcomes.  Some have tried the social return on investment methodology (SROI). Encouraging news is it has high internal validity, encourages contextually embedded definitions of outcomes, and learning through participatory processes. However, less heartening are research findings on its use in the UK third sector. They suggest SROI does not lend itself to generalisation or comparison. Finding ways to assign monetary value to outcomes is complicated. And since SROI tends to be used for competitive positioning, it is susceptible to abuse.

Of course part of the problem is that VfM is embedded in new public management discourse that assumes competition necessarily leads to greater efficiency. But many in the aid sector feel such competition could compromise aid quality and lead to more aid being allocated to what is easiest to measure. Arguably, the competitive behaviour of those seeking official aid could make this a self-fulfilling prophecy.

Concerns about negative effects of competition are partly responsible for collaborative approaches to sharing impact assessment and VfM tools, as well as defining common outcomes and indicators for benchmarking. Could this avoid the waste of M&E resources and enable more accountable spending decisions? Well yes. But such efforts are not without risk. Subtle differences in aims, approaches and partnership models used by various actors working in similar sectors stem from significant ideological differences and theories of social transformation. Hence attempts to develop metrics for purposes of VfM comparison require caution to avoid apple and orange comparisons or questionable  generalising VfM claims.

Surely there is also a risk that well-intentioned attempts to develop common indicators could lead to ‘one-size-fits’ all development outcomes and VfM definitions that might be viewed as a top-down approach to governing aid, reducing space for contextually defined evaluation approaches informed by complexity thinking? We need to have more discussions about the possible implications of the VfM agenda on the quality of relationships with partners in the Global South.  Even attempts to respond through promoting more democratic participatory approaches to measurement could inadvertently contribute to them becoming depoliticised, instrumental means to appease donors.

For those who are interested in engaging with more political aspects of the VfM debate, I recommend Michael Power’s book: The Audit Society: Rituals of Verification.  Power argues that VfM is invoked at times of crisis. He notes that despite the VfM discourse invoking images of objective measurement being used to inform decision-making, VfM determinations often use subjective scoring and ranking. Power argues that VfM audit is inevitably an ambiguous and subjective means to justify rather than inform policy decisions. His claims that VfM dictates produce a demand for expensive auditing and evaluation knowledge and practices raise questions about the relative value for money offered by those providing such services in the aid sector.

Power’s arguments suggest policy actors are right to be concerned that an emphasis on VfM privileges accountability to tax payers and could undermine accountability to citizens in aid recipient countries. Perhaps we should make special effort to demonstrate the role social accountability programmes can play in empowering and enabling citizens to demand their governments use aid more accountably? Surely finding ways to show taxpayers how such approaches contribute to changing attitudes and behaviours that reduce the risk of leakage is a key part of the VfM conundrum?

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