In September 2016, we convened our first webinar for the Business Environment Reform Facility (BERF) to share lessons learnt on measuring Value for Money (VfM) in Business Environment Reform (BER) Programmes. It was the first of a series of multi-country knowledge sharing events organised by Itad for DFID and other organisations engaged in BER.
We presented material from the recent Itad Evidence and Learning (E&L) Note ‘How to Measure Value for Money in DFID’s BER Programmes Delivered by the International Finance Corporation’, I wrote with Gulden Bayaz. It also included presentations from Kamal Siblini of the IFC, and Simon White, coordinator of DCED Business Environment Working Group. The webinar was introduced by Angela Strachan (Itad’s BERF Team Leader) and we had invaluable support from our colleagues Fabiola Lopez-Gomez and Tara Stearn. Find the webinar report and presentations here.
What is BERF?
The UK Department for International Development (DFID) funds BERF under the Business Environment for Economic Development (BEED) Programme. It responds to demand from DFID’s priority Country Offices and stakeholders to initiate, improve and scale up business environment reform programmes. BERF provides expert advice, analysis of lessons learned, policy research about what works and what doesn’t and develops innovative new approaches to involving businesses and consumers in investment climate reform. Itad is managing the Evidence and Learning activity stream for BERF, producing a series of Evidence and Learning Notes, and webinars.
What was discussed during the webinar?
Our objective was to share lessons learnt in measuring VfM in DFID’s and other donors’ BER programmes. We placed a special focus on equity considerations, building on interest in this subject from DFID advisors consulted for the E&L Note.
Kamal Siblini, Senior M&E Specialist and VfM Expert at the World Bank Group, explained how VfM targets are usually calculated in IFC projects during the design phase, using budgets and results targets, and later assessed at project completion, using expenditures and actual results. Kamal identified a number of challenges in calculating VfM in BER programmes, including:
- Limitations imposed by financial management systems which prevent managers to budgeting by programme component costs and not by individual cost categories. These are high-level costs and can make it difficult to accurately determine programme costs at a finer-grain level.
- Challenges in making cross-country BER programme comparisons arising from limitations in the availability of good quality private sector data as well as challenges from the political economic context and country preparedness for reform.
Gulden Bayaz, independent VfM Expert, and I introduced the DFID and National Audit Office 3E conceptual framework for VfM and discussed recent DFID developments in VfM, such as the trend in developing indicators that are linked to the programme logframe. I discussed the IFC VfM framework to measure compliance cost savings, and Gulden highlighted some of the example cost-effectiveness indicators presented in the E&L Note. Gulden explained how theories of change can be used to explain programme VfM by linking reforms to expected headline programme results and highlighted some of the recommendations emerging from the E&L Note:
- The need for greater disaggregation of project budgets and financial reporting.
- Better understanding of government opportunity costs (which is also a DCERD recommendation).
- Political economy analysis during programme design and implementation.
- Better understanding of who benefits from BER interventions (equity). This could include breaking down impact by income quintile of beneficiaries and gender. Also relevant is a deeper understanding of how reforms have affected women’s social position.
Simon White, coordinator of the Business Environment Working Group (BEWG) for the Donor Committee for Enterprise Development, discussed the link between equity and VfM and highlighted four dimensions to measuring equity in BER programmes:
- Informal economy
At the end of the webinar, we had a lively debate on the issues raised in the E&L Note and the presentations. Participants raised questions on the links between assessing the VfM of programmes and their sustainability, incorporating equity measures and suitable additional outcome metrics for BER programmes, such as tax revenue.
What’s next for BERF?
Watch this space for details of future BERF webinars. The next is likely to be on gender and BER, in collaboration with the UN High Level Panel on Women’s Economic Empowerment, the World Bank and IFC, to share lessons learnt to date on mainstreaming gender in BER programmes.