Work of the Office for Value for Money

The Treasury must provide an estimate of how much the OVfM will cost including the cost of any external consultants it intends to procure, and then provide the actual cost of OVfM after it completes its initial work. (Recommendation, Paragraph 6) Duplication

The OVfM must explain how it will interact with existing organisations and frameworks in government and the public sector that are already tasked with delivering value for money to avoid unnecessary duplication and to utilise existing expertise. (Recommendation, Paragraph 11) Value for money studies

The Treasury must clarify publicly by the end of January which departmental agencies or budgets will be subject to OVfM value for money studies. (Recommendation, Paragraph 17) Investment proposals

The Treasury must clarify how the OVfM will scrutinise investment proposals in the Spending Review process. This should include the criteria by which the OVfM selects investment proposals for scrutiny. The Treasury should also provide the method by which such investment proposals will be scrutinised, including the time horizon over which projected savings will be assessed. In addition, the Treasury must clarify how it will handle proposals where impact is not easy to quantify using existing economic methods. This may include spend-to-save measures. The Treasury must also clarify what scrutiny will be applied (if any) to investment proposals that are not selected for assessment by the OVfM. (Recommendation, Paragraph 19) 10 Evaluation

The Treasury must set out how and when it will evaluate the OVfM’s work, including specifying the metrics and key performance indicators that it will use to evaluate the overall worth of the OVfM project. (Recommendation, Paragraph 21) Outcomes

To maximise concrete outcomes from this project, the OVfM must specify before it is disbanded which parts of the Government should take responsibility for implementing its recommendations and by what timetable. To that end, the Treasury must set out the OVfM’s recommendations; which of them it accepts or rejects; the reasons for such acceptance or rejection; and specify how it will monitor the effectiveness of the implementation of the OVfM’s recommendations. Based on learning, the OVfM should also recommend any improvements to existing structures and frameworks which currently aim to evaluate and deliver value for money across the Government. (Recommendation, Paragraph 23)

The OVfM’s task is challenging because it is lightly resourced, and it has only a very short period of time to drive tangible improvements in efficiency in departments’ spending during the Spending Review period. Its worth will depend on its ability to identify and to deliver meaningful, original new ways of securing value for money in public spending. (Conclusion, Paragraph 24)

At the end of its work on the Spending Review, the OVfM should provide a short report to the Committee covering the following: