Programme Budgeting – Testing The Approach in Scotland

2. Use of Programme Budgeting information

7. Programme budgets provide information on current expenditure related to activity in different programmes. These data can be used, along with process and intermediate outcomes, to review the value for money associated with various programmes and therefore potentially compare this among programmes. They can be used to facilitate discussions around areas such as:

• Is the level of preventative activity for each programme appropriate?
• Could better value for money be achieved by expanding investment in preventative activities?
• Which programmes could be reduced to allow more investment in preventative activities?
• Is the distribution of expenditure among programmes appropriate?
• Does the distribution of expenditure between programmes reflect the priorities for NHSScotland?
• Is the distribution of expenditure within programmes (between primary and secondary care for example or among sub programmes) appropriate?
• Does the allocation of resources in NHSScotland vary from that in other healthcare systems?
• Could better value for money be obtained by redistributing among programmes?
• Could better value for money be obtained by redistributing resources within programmes?

8. The following sections describe work by analysts within the Scottish Government to test the use of Programme Budgeting at national level in Scotland. Two approaches to determining programme budgets were tested:

Bottom up approach using activity and cost data obtained from information requests to the Information Services Division of NHS National Services Scotland (ISD) for conditions related to risk factors for long term conditions.

Top down approach grouping expenditure and activity by 21 of the 23 programmes of care used in the NHS in England. These programmes reflect ICD10 categories, plus an 'other' category^[5] . The two programmes that were excluded were 'healthy individuals' and 'social care needs' as these map specifically to National Service Framework activities, which do not apply in Scotland. Any activity and cost identified with these was included in the 'other' category. Details of the methodology used by ISD is included as Appendix C.

9. Information from programme budgets in itself will not offer insight into the appropriate allocation of resources across various programmes. This requires measures of outcome which can be applied consistently across all programmes to determine the relative efficiency of different programmes.

10. Such an outcome measure should reflect the purpose target of increased healthy life expectancy and the national outcomes:

• We live longer, healthier lives
• We have tackled significant inequalities in Scottish society

11. An outcome measure should therefore incorporate both aspects of healthy life expectancy - additional years of life gained (reduce premature mortality) and enhanced quality of life (reduced morbidity). At present it is not possible to measure outcomes in this way across disparate programmes. Instead, proxy process and intermediate outcome measures, such as attendances at retinal screening or 30 day survival after stroke, can be used to build up a picture within the relevant programme.

12. To illustrate the potential use of Programme Budgeting, policy colleagues were asked to identify measures of process and intermediate outcome associated with the relevant programme.

13. For illustrative purposes, detailed information is presented on activity, costs and examples of process and intermediate outcomes relating to obesity, smoking and excessive alcohol consumption for the bottom up approach. Similar information is presented for the cancer and mental health programmes, plus cerebrovascular and diabetes sub programmes, for the top down approach.