Programme Budgeting – Testing The Approach in Scotland

Executive Summary

Sara Twaddle, Health Improvement Strategy
Marjorie Marshall, ASD
Nils Michael, ASD

This methodology paper describes the pilot application of Programme Budgeting and Marginal Analysis (PBMA) in Scotland. Two approaches were tested using data from 2007/08: a 'bottom up' approach identifying the costs of preventative activity and related diseases for three risk factors amenable to early intervention (obesity, smoking and excessive alcohol consumption) and a 'top down' approach presenting all NHSScotland activity and cost information by 21 diagnostic categories.

Within the Health Care Quality Strategy for NHSScotland^[1] one of the three quality ambitions is concerned with providing a more efficient and effective health service. This paper supports this ambition by discussing how outcome measures could be used, along with cost data disaggregated in this way, to inform discussions around the value for money associated with different programmes.

With further development PBMA information could inform discussions such as:

• Could better value for money be achieved by expanding investment in preventative activities?
• Does the distribution of expenditure between programmes reflect the priorities for NHSScotland?
• Could better value for money be obtained by redistributing among programmes?