Value for money and what it means for UK NGOs

1. Value for money and what it means for UK NGOs Busan CSO Forum November 2011 Presenter: Sara Cottingham (VSO)

2. Contributors to the BEP

3. The Bond Effectiveness Programme (BEP) and Value for Money • Developing agreement and supporting implementation of a sector wide framework of shared indicators anddata collection tools (Improve it Framework); and an online effectiveness self-assessment and resource portal (CESA). • Building knowledge and skills to support members to measure and manage effectiveness and value for money • Supporting greater transparency within the sector by helping UK NGOs to comply with this International Aid Transparency Initiative (IATI) and encouraging greater disclosure of performance data. • Creating an enabling environment that encourages and supports organisations to deliver improvements in their effectiveness …a three year process of supporting UK NGOs in improving how they assess and demonstrate their contribution to social development; this involves 3

4. Why focus on VfM now? • Key component for improving NGO effectiveness • Donors are putting more emphasis on VfM • Accountability • Narrative • Engaging proactively with VfM means we can help promote the approaches that work best for CSOs and shape the use of the concept in international development

5. What is VfM? • “before investing, time, resources and energy into an activity or programme weigh up the costs (what is being put in) and benefits (what is being achieved) of different options and be able to make the case for why the chosen approach is the best use of limited resources” • “Effective programmes first and foremost do the right thing, but also do it efficiently” • Value for Money = • Economy • Efficiency • Effectiveness 5

6. VfM is putting forward a defensible case • Justifiesthe programme intervention and provides the best results given the available resources • Provides a clear analysis of what constitutes value for money to achieve its mission • Clearly communicates the systems and procedures in place to monitor and manage value for money during the implementation of the programme • Has a strong focus on results – and robust data

7. A framework for engaging with VfM Improved value for money …demonstrating value for money through evaluation of programme outcomes …compare value for money across programmes where comparative data can be generated Comparing value for money Demonstrating value for money Managing for value for money …manage for value for money - right processes

8. Proactively shaping VfM agenda • Avoids • A focus on low cost – and not development outcomes • Unhelpful competition between CSOs • Unhelpful competition with other providers • Development becoming all about monetising outcomes • Promotes • Sharing of approaches – now prioritising Southern partners • Improving together • Integrity of sector

9. Key Points • VfM is not just about econometric calculations, its a way of approaching program design, implementation and evaluation – building a defensible case • VfM requires an NGO to speak robustly about results, so cannot be divorced from the wider effectiveness agenda. • The VfM agenda is not new • Approaches that compare value for money could produce dramatic improvements in NGOs work