Since 2012 ActionAid has been working on a Pilot Project on Value for Money as part of the Programme Partnership Agreement (PPA) with DFID. This paper summarizes some of the key learning on VfM and on the approach that was developed.
While VfM practices have proven to be difficult for INGOs to use, the VfM agenda does offer an opportunity for aid agencies to look strategically and more analytically at their work, to relate the costs of their interventions to changes achieved and to understand which changes have most value for different people in the community and why.
The paper provides an overview of ActionAid’s learning and reflections from implementing its VfM Pilot Project, through which it developed an alternative approach to VfM, building on practice, learning-by-doing with ActionAid frontline staff, partner staff and the women and men it works with on the ground. The approach explores what is changing and what is not changing as much, as a result of ActionAid’s work, to understand which areas of work are worth the investment and identify what needs to be done differently in the future.
To do so, ActionAid and partners developed a set of participatory tools to enable discussions with the communities about the VfM of its work. ActionAid sought to develop an approach that would enable an understanding of which approaches it invests in have the greatest positive impact. This in turn would help to realign the way budgets are allocated. It is also intended to ensure that those participating can have a real say in how budgets should be allocated and to start the process of reversing the top down power dynamic that currently characterises much development work.
This contrasts with conventional VfM approaches that focus attention on financial management issues which, while important, should not lie at the heart of the question about whether or not VfM is achieved. ActionAid’s approach to VfM goes beyond the analysis of operational systems and offers an opportunity to foster learning and enable constant improvement to achieve greater and deeper social change.
In this way, VFM becomes part of a wider accountability agenda, that enhances transparency regarding programming and decision-making, and accountability as to how success is assessed and how learning allows to maximize impact.