06 October 2016

How much does that intervention cost? – Testing the Cost Benefit Tool

Academics from London and Australia held a workshop with volunteers from a range of organisations to test a cost-benefit tool which has been developed as part of the work delivered by our Commissioned Partnership Programme.

The workshop was introduced by Professors Shane Johnson and Nick Tilley (UCL) who had asked for an opportunity to test the Cost Benefit Tool, developed by them and Dr Matt Manning, Margarita Vorsina and Gabriel Wong from the University of Australia.  Professor Tilley had specifically asked participants to use the Cost-Benefit Tool, which is Excel-based, prior to the workshop and try to "break it"!

This Tool has been developed by the Commissioned Partnership Programme for the What Works Centre for Crime Reduction, and included guidance and an easy-to-use spreadsheet tool to assist practitioners to make a cost benefit analysis of implementing crime reduction interventions.  

Participants at the workshop came from a range of organisations – including police officers and staff, representatives from the office of the PCC and charities delivering services directly to both victims of crime and to offenders as part of rehabilitation.  Discussions during the day revealed that participants identified individual ways of using the Cost-Benefit Tool in a range of ways.  For example, Arch North East, a charity providing services for rape survivors, decided that they would use the Tool to cost their contribution to a wider multi-agency initiative; allowing them to identify their proportion of the cost, along with the benefits.

Nicky Harkin, CEO, Arch North East said:

"I think the tool could be a really good way of demonstrating partnership inputs to multi-agency initiatives such as the MARAC, and would be useful for specialist support services and other voluntary sector partners to highlight their contributions to these processes.  The Tool provides a really useful template for identifying full cost recovery on project costs and we will use it when costing out future bids and initiatives."

Part 1 of the Cost Benefit Tool aims to help users to organise costs to include a variety of factors such as personnel time, equipment purchases, materials used (e.g., fuel) and additional expenses (e.g., insurance or maintenance costs).  It also helps by classifying costs as direct (e.g., salaries for project staff) or indirect (e.g., administration) and identifies intangible costs (e.g., reduction in productivity due to the extra demands of the new intervention). 

Users can also use the spreadsheet to insert upper and lower estimates where only approximate or national costs are available or intangible cost estimates are used.

Lee Fryatt, Inspector, Criminal Justice and Investigations, Hampshire Constabulary, noted that:

"….the workshop and the cost benefit tool have the potential to help police forces be more objective in providing a more robust evidence base for new and ongoing projects in terms of ensuring any investment provides value for money. This is a key requirement in times of diminishing public funds and the drive for continuing police efficiency."

The Tool also allows users to make a comparison of costs prior to the intervention being implemented (i.e. the status quo or costs in absence of the intervention) and after the intervention.  The Cost-Benefit Tool will calculate the amount of savings made by avoiding the crime.

Fiona Murray, Development Manager, Dorset Police and the Office of the Police & Crime Commissioner said:

"By using cost benefit analysis tools like this, commissioners can become more informed about which interventions may deliver greater benefits that result in financial savings for the police and partners.  This is particularly important for Police and Crime Commissioners who are interested in jointly commissioning services with health or local authority partners, because identifying potential savings for the police and partners can help commissioners work out who should contribute what."

The participants worked through an example based on the costing of the Cardiff Violence Prevention Programme to demonstrate both the costs and benefits sections of the Tool.  So, costs of replacing pub glasses with plastic cups were categorised as indirect costs and the effectiveness and benefits of the interventions were identified and costed as reductions in violence against the person offences such as wounding, serious wounding and common assault.   Costs associated with crimes are based upon Crime against individuals and households.  Home Office Online Report 30/05 (2005),  but other local data can be used.  

Part 2 of the Tool allows the user to estimate how much it will cost to implement an intervention in a different context, such as a new location or more widely (upscaling from a pilot project to a whole treatment area).  This analysis asks the user to compare the differences between the two areas in a series of apparently simple questions, then uses a technique called Analytic Hierarchy Process (AHP) to estimate the new costs.

Bob Bunney, Crime Reduction Lead Officer, Devon, Dorset and Cornwall Police Alliance said:

"The Costing Tool offers the opportunity to determine costs of projects to support bids, replicate interventions (or upscale them) and forecast savings." 

Workshop participants will be using the Tool to create cost benefit analyses of their own interventions and will feedback comments and suggestions to the academic team during October.  We expect to publish the Tool following inclusion of suggested changes. 

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