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Value for Money

Value for money is a very important aspect of humanitarian ethics and relates to the Code’s concern of not wasting valuable resources. Again, this is a correct moral instinct and an essential principle in humanitarian accountability, just as it is in all areas of life. Writing about medical practice, Aristotle famously noted that there are only two kinds of mistake: "we either fail in working things out, or fail in attention when we are putting things into effect”.15 Similarly, there seem to be two potential types of wastage in humanitarian action: one born of miscalculation, and the other of carelessness. Mistakes born of carelessness are not as complicated as calculations of relative value. For example, if a UN agency has a large stock of vaccines in a hot and humid part of Eastern Congo and it fails to keep these humanitarian resources in optimal cool storage conditions so that they are ruined, then the agency has wasted these valuable resources because of negligence and incompetence. If an NGO in Somalia loses $50,000 to thieves during a cash relief programme because its security measures were unnecessarily lax, then this too is a careless waste. Calculations of value for money, however, can be complicated. They tend to involve more consequentialist thinking about the best use of resources. For example, will an agency achieve better humanitarian value by investing in a high-cost therapeutic feeding programme that reaches 2,000 malnourished children in an IDP camp, or a rapid market intervention that gives a similar amount of cash to local merchants to import food into the district and drive down prices in an area? The first project may save 2,000 children; the second project may reach 10,000 families with malnourished children, addressing both adult and infant malnutrition, and preventing further displacement.

In an article on cost-effectiveness in global health care, Oxford philosopher Toby Ord starts with an even more striking example of value for money decision-making:

Suppose we have a $40,000 budget that we can spend as we wish to fight blindness. One thing we could do is to provide a guide dog to a blind person in the United States to help them overcome their disability. This costs about $40,000 because of the training required for the dog and its recipient. Another option is to pay for surgeries that reverse the effects of trachoma in Africa. This costs less than $20 per patient cured [and would] cure more than 2000 people of blindness.16

Ord suggests that if we think that people are of equal moral value, then the second option is more than 2,000 times better than the first, which would waste about 99.95 per cent of the potential value of the original ?40,000. This is an extreme example because it can rightly be argued that US health budgets have a first moral call on US citizens. But Ord’s kind of utilitarian thinking must play a part in humanitarian programming and accountability. It is clear that some humanitarian interventions offer much better value than others and they must be prioritized wherever possible, or included as part of a spectrum of interventions when higher cost interventions for certain individuals may also be justified. Value for money is essentially a matter of fairness and equity in the allocation of resources between people. Cost-effectiveness demands that we examine what is the most reasonable course of action when we are faced with many similar needs and limited resources. If we are careless in seeking value for money, we may well breach the principle of impartiality by discriminating in favour of a small group who are receiving high-cost and inefficient interventions while others remain poorly served or ignored.

The UK government’s thinking on value for money in aid is perhaps the simplest to follow. The UK’s Department for International Development (DFID) emphasizes "the three Es: economy, efficiency and effectiveness” as a guide to making value for money decisions.17 Cheapest is certainly not necessarily best value, but the relative cost and effectiveness of different programmes must be weighed. In the 2011 famine in south central Somalia, access to food was the essential priority for hundreds of thousands of people. Large food delivery programmes were costly and inefficient because of serious access problems. Instead of waiting for improved access, UNICEF’s Hannan Sulieman led an innovative NGO consortium that delivered $92 million of cash transfers into the area via the Hawala network of Somali banking. Both food and cash transfers were too late to save the 257,000 people who died in the famine, but the cash transfers were a more cost-effective way of responding. They were more economical, and more efficient, and more widely effective than simple food rations, because of the greater autonomy and participation they encouraged in Somali women. Even though a small percentage of funds were misdirected and abused, the level of corruption was also less than with in-kind aid like food.18 Designing and reporting on programmes with value for money or cost-effectiveness in mind is, therefore, a significant imperative in humanitarian ethics and must be recognized as integral to Article 9 of the Code.

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