Value for money is an economic concept we relate and deal with individually and collectively on a daily basis. We negotiate purchase transactions on a regular basis with the aim of getting the best deal thereby obtaining value for the sums expended. However, not many people give a thought to value for money beyond the drive for ‘a good deal’ on a particular purchase. Fewer people even know that the pursuit of value for money is a collection of structured set of techniques applied in modern management to reduce cost, improve processes and enhance productivity. An insight into value for money becomes more interesting when it is realised that it is a very potent tool for instituting and enhancing transparency and accountability. In this regard, value for money automatically becomes a forceful arrow in the quiver to combat corruption and fraud.
What is value for money, you may now ask and how come so much use is ascribed to it? If all that has been ascribed to value for money is correct, why is it that very little is known about it and why is it not more widely applied? These are legitimate questions particularly in developing countries where productivity is low and falling, corruption is rife and on the increase. The need for accountability and transparency particularly in our public lives is preached daily like a sermon on the mount but continue to remain a mirage. It is true indeed that the pursuit of value for money could come to the rescue as a useful tool.
Value for money is a requirement to maximise the use of scarce resources.