Efficiency and value for money

Constrained public spending coupled with the economic downturn, are increasingly putting purchasers and deliverers of services under pressure to achieve efficiency and value for money.  The Coalition Government has put new approval mechanisms in place on projects proposed by government departments. From the top down, people are being required to justify their spend to deliver efficiency and value for money.

What are the implications?

Moving forward

Increased competition for funds may mean organisations have to work harder to demonstrate the outcomes of their work and the ‘distinctive value’ of their services, particularly when competing with private sector providers for funding.

  • Do you have good systems in place to assess your outcomes, and the broader value you create (social, economic and environmental)?
  • Does your organisation need to improve how it assesses and demonstrates the impact it makes?
  • How can you develop your negotiating skills to improve your discussions with funders (potential and actual, and your chances of securing a good deal?

An increased emphasis on value for money and efficiency may favour larger organisations that can offer economies of scale.

  • Can you work in partnership with or subcontract from larger organisations?

Being clear about what you offer commissioners could put you at a competitive advantage.

  • You may wish to think about your position in relation to other players – do you want to stay small and cover niche markets, or work towards targeting high volumes of clients to benefit from economies of scale?
  • Could working in partnership or collaboration with other VCOs help you to secure funds in the future?

Want to know more?

Re-thinking efficiency and value

Published by: NCVO

Date: 2006

Format: PDF

What is it? An article summarising the key themes of ‘efficiency’ and ‘value’ as discussed at the Sustainable Funding Project’s first Annual Public Service Delivery Network Conference.

How useful is this? This informative article looks at changes in understanding of the terms ‘good value’ and ‘efficiency’, and discusses revising their meaning in light of the ‘added value’ that voluntary and community organisations provide.

Full Value: Public services and the third sector

Published by: Performance Hub

Date: 2008

Format: Pdf

What is it? A think piece that introduces the idea of ‘full value’; a new concept that might better recognise the broader worth of VCOs in the future.

How useful is this? The briefing highlights the limitations of the concepts of ‘added value’ and ‘return on investment’, which are often used to weigh up the benefits of public service delivery by VCOs.  The authors suggest that the alternative idea of ‘full value’ is a much more useful approach.  ‘Full value’ involves thinking about all the outcomes an organisation brings about, and the satisfaction it delivers, both for its users and for others affected by its work.  The concept can be used by all VCOs, regardless of whether they are involved in public service delivery.

Other comments: NCVO has also published a guide to ‘full value’ for VCOs: True Colours: Uncovering the full value of your organisation.  It includes exercises to help organisations identify and communicate their worth to different audiences.  The guide also includes a section dedicated to the role VCOs play in shaping and delivering public services.

Measuring impact – A guide to resources

Published by: NCVO

Date: 2002

Format: Web

What is it? This guide provides an introduction and details of further resources for VCOs interested in impact and its measurement.

How useful is this? This provides a useful starting point for VCOs who want or need to demonstrate their impact.  Chapter two looks at why VCOs may be motivated to measure their impact. Chapter three defines impact and describes how this term relates to the more widely used concepts of outputs and outcomes.  Chapter four expands on the problems and limitations of impact measurement and aims to help VCOs to be realistic about what can be achieved. Chapter five looks at a selection of tools that have been developed for the measurement of impact. The final chapter includes a useful list of resources for understanding and implementing impact measurement including step-by-step guides.

Third Sector Governance in the Spotlight

Published by: The Guardian

Date: 2010

Format: Web

What is it? An article examining how the drive toward increased value and efficiency, catalysed by the recession, is leading third sector organisations to focus on improving management and governance.

How useful is this? This article suggests that the failure of governance within the financial sector that led to the banking crisis and subsequent economic downturn has motivated other sectors including the VCS to focus on management issues.  This coupled with increasing competition for funds and public service delivery contracts requires more dynamic governance; financial skills and expertise are therefore becoming desirable prerequisites for board members and trustees.  The article explores issues surrounding recruitment and experience, providing real life examples and reiterating advice from both charities and umbrella organisations (including the NCVO).

Last updated at 16:22 Thu 03/Feb/11.

Recent comments


For tips on how to demonstrate the value of your work, take a look at NCVO’s dedicated Strategy and Impact website: www.strategy-impact.org.uk.

Infrastructure organisations might also be interested in our new Value of Infrastructure project which, over the next three years, will be helping support agencies to identify and communicate the impact of their work.

Joh's picture


Funders need to make investments which are fair and not biased - so often I see organisations funding schemes which frankly are pointless!

Joh's picture


More effort also needs to be made companies dont buy products which are minimally used - instead thinking of using van rental companies over say using there own fleet.

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