Achieving greater value for money (VfM) in public investment remains an essential yet elusive goal, especially as governments grapple with constrained public finances and heightened scrutiny. At the 2025 UK Evaluation Society Conference in Glasgow, we presented an integrated framework for smarter investment.
The framework we proposed is designed to drive better resource allocation decisions across the life-cycle of public investments. While cost-benefit analysis (CBA) remains essential, it alone cannot address the complexities of policy making. Our panel demonstrated how evaluative reasoning - using explicit criteria and standards - enables insights from CBA to be woven together with broader evidence and decision-making considerations, to ensure VfM at every stage, from business case development to post-delivery review.
Governments face mounting pressure to deliver results for citizens - whether that means boosting economic growth, progressing social policies, or addressing global issues like climate change and security. At the heart of these ambitions is the need for good evidence on the value delivered by public spending. Without robust evaluation, it is impossible to know if investments are achieving their intended outcomes or if resources are being used as efficiently and effectively as possible. This is critical for informing future decisions, ensuring that public money is directed towards interventions that offer the greatest value.
Value for money (VfM) is not a one-off check. It should be considered throughout the entire policy cycle - from setting the rationale and objectives, through appraisal, monitoring, and evaluation, to feedback and learning. This approach, often illustrated by the ROAMEF cycle (Rationale, Objectives, Appraisal, Monitoring, Evaluation, Feedback), ensures that evidence and reasoning about expected and realised value are embedded in every stage of a project or policy.
Despite this need, current practices are falling short. For example, a recent review of the UK Government’s Major Projects Portfolio by the Evaluation Task Force found that only 17% of projects have robust VfM evaluation plans in place, despite projects collectively representing hundreds of billions of pounds in public investment. Too many projects focus on cost and schedule at the expense of measuring and realising benefits. This gap underscores the urgent need for more - and better - VfM evaluation across government.
Recent initiatives, such as the publication of evaluation repositories in both the UK and Australia, are steps in the right direction, aiming to improve the generation, quality, and use of evaluation evidence. However, closing the VfM gap requires a collective effort - across government, evaluators, and the wider policy community. Everyone has a role to play in embedding evaluative reasoning and accountability into public investment decisions.
Public projects are intended to deliver real value to society, whether through improved infrastructure, better public services, or enhanced national security. Yet, despite vast resources and ambitious planning, public projects consistently underperform, delivering less value than promised. Analysis from Oxford Global Projects, covering more than 19,000 global projects, paints a stark picture:
Such systemic failure, termed the “Iron Law of Major Projects” by Professor Bent Flyvbjerg, indicates that problems are rooted in planning biases rather than random error. These patterns have persisted for decades and across sectors, challenging the notion that overruns are just bad luck. Take, for instance, the Sydney Opera House, which suffered poor planning and execution at the outset leading to significant cost overruns, delays, and rework. Flyvbjerg (2023) used the Opera House as a case study to illustrate such pitfalls often inherent to megaprojects. These consistent shortfalls in achieving promised benefits and controlling costs erode public trust, strain budgets, and ultimately diminish societal value.
Nonetheless, the Opera House also illustrates the need to consider long-term value alongside costs; despite its chaotic management, it has nonetheless brought value in both tangible (AUD$1.2 billion in one year according to a 2023 Deloitte report) and intangible terms (as an iconic symbol of Sydney and Australia, with UNESCO World Heritage status). The core point remains that its VfM would have been greater had its design and construction been better managed.
The methods traditionally employed for project evaluation and appraisal - primarily cost-benefit analysis (CBA) - have inherent limitations:
Traditional approaches often miss the bigger picture – focusing on what’s easy to measure, rather than what matters most to citizens. To truly maximise VfM, a paradigm shift in evaluation practices is necessary.
To overcome the persistent challenges in delivering VfM across public projects, a more robust and holistic framework is required - one that moves beyond the limitations of traditional approaches. The solution lies in an integrated framework that brings together insights from evaluation, economics, project management, and policy expertise, ensuring that VfM is not just a box-ticking exercise but a dynamic and evidence-driven process embedded throughout the policy cycle.
At the heart of this framework is the recognition that VfM is more than a simple calculation of costs and benefits. It is about making reasoned judgements on how well resources are used and whether worthwhile value is created. This requires a systematic approach to determining merit, worth, and significance - the core of evaluation - while also drawing on economic analysis to understand the balance of benefits, costs, and trade-offs of resource allocation decisions. By combining these disciplines, the framework ensures that both quantitative and qualitative aspects of value are captured, including those that are hard to measure or monetise, such as social and environmental impacts.
The framework should be underpinned by a set of transparent, context-specific criteria (defining what matters) and standards (defining what “good” looks like) in a given situation. In ex-post evaluation, these criteria are often organised around the “5Es” framework of economy, efficiency, effectiveness, cost-effectiveness, and equity - though in principle, additional considerations such as relevance, affordability and sustainability may also apply. By defining criteria and standards explicitly, the judgement process is made explicit and challengeable, ensuring that decisions are based on evidence and reasoning rather than unchecked assumptions or optimism bias.
The Value for Investment (VfI) approach implements this underlying logic through a set of guiding principles and a stepped process. It begins with understanding the policy/programme and its value proposition, then moves to defining what value means in that context by co-creating criteria and standards with stakeholders. Evidence is then gathered using a mix of quantitative, qualitative, and economic methods, analysed, and synthesised. Evaluative judgements are made using the agreed criteria and standards. The results are reported in a way that is clear, actionable, and credible to decision-makers and stakeholders.
This framework is not limited to retrospective assessment. It is designed to be embedded throughout the policy cycle - from setting the rationale and objectives, through appraisal, monitoring, and implementation, to evaluation and feedback. At each stage, evaluative reasoning is used to assess options, design interventions, monitor progress, and learn from outcomes. This continuous loop ensures that value for money is not an afterthought but a guiding principle at every step.
By adopting this integrated approach, public sector organisations can move beyond the shortcomings of traditional methods and develop an evaluative culture supporting accountability, learning, and continuous improvement. The framework not only helps to address the biases and gaps in current practice but also supports better decision-making, more effective use of resources, and ultimately, greater public value from every investment.
To maximise public value, evaluation must move beyond retrospective assessments and become an integral part of the entire policy process. The ROAMEF cycle (Rationale, Objectives, Appraisal, Monitoring, Evaluation, Feedback) provides a structured framework for embedding evaluative reasoning at every stage, ensuring that evidence informs decisions from inception to post-implementation review.
By institutionalising VfM-focussed evaluation across the ROAMEF cycle, governments can transform VfM assessment from a backwards-looking, compliance exercise into a dynamic tool for smarter investment, fostering public trust and long-term resilience.
An independent, critical assessment of the rationale for a new policy or project proposal, drawing on insights from past evaluations, will identify gaps, avoid repeating mistakes, and align new initiatives with proven strategies. Clear, measurable objectives can be set, ensuring intended outcomes and VfM expectations are explicit and tied to broader public priorities like economic growth or environmental sustainability.
Cost-benefit Analysis (CBA) can be augmented with evaluative reasoning to counter systemic over-optimism. As part of this, independent experts can validate cost and benefit estimates against historical data - a practice known as reference class forecasting - to reduce planning biases. In the UK, the standard framework for ex ante appraisal is the Five Case Model, as set out by HM Treasury. If combined with structured evaluative reasoning, the existing Five Case Model can be used to ensure a comprehensive, evidence-based assessment of value and risk, to challenge planning biases and ensure that all relevant costs and benefits - including those that are hard to monetise - are considered before resources are committed. This can be done using the VfI framework set out above, to provide a robust ex-ante assessment against each of the Five Cases (rather than the Five Es), laying the groundwork for robust, defensible business cases that support Value for Money from the outset.
Monitoring: facilitating real-time learning and adaptation
Continuous, learning-focussed monitoring should track both quantitative metrics (costs, activities, outputs, outcome indicators) and qualitative factors (context, implementation quality, success factors, VfM performance, etc). This enables adaptive management, with real-time data informing mid-course corrections.
Evaluation: providing a rigorous and holistic performance assessment
Ex-post evaluations should go beyond an accountability-driven focus on whether or not key outcome objectives were achieved, to provide: (i) a robust assessment on the total societal value created by these outcomes; (ii) whether this value justified the investment; and (iii) what could have been done differently (in design and/or implementation) to achieve greater impact and VfM. The Value for Investment (VfI) approach set out above, can be integrated with process, impact and VfM evaluation components (as per the Magenta Book) to provide this type of robust, holistic assessment of performance and VfM.
Feedback: closing the loop
The final stage ensures lessons and data from past projects’ performance feed into future policies and public spending allocation analyses and decisions. Systematic feedback mechanisms should be institutionalised to foster a culture of learning and accountability. For example, Hong Kong’s common cost underruns - achieved by treating overruns as professionally unacceptable - demonstrate how accountability and transparent reporting can invert the “Iron Law of Major Projects”.
Adopting this integrated framework demands overcoming entrenched institutional inertia. Policymakers must openly acknowledge existing shortcomings, commit to embedding evaluative thinking from inception, and prioritise transparent, continuous learning-focussed monitoring throughout projects.
Two critical messages summarise this call to action:
These two principles should guide all those involved in public investment, from policymakers, to project managers, evaluators and beyond, as they work to maximise the impact and value of every pound spent.
Flyvbjerg, B. (2023). How Big Things Get Done. Penguin.
HM Treasury (2022). The Green Book: Review and Refresh.
King, J., Hurrell, A. (2024). A Guide to Evaluation of Value for Money in UK Public Services: Why cost-benefit analysis alone may be insufficient to evaluate VfM, and how to navigate a solution. Verian Group.
James Collis is the Deputy Director of the Economics Observatory at the London School of Economics. Contact: j.d.collis@lse.ac.uk
Alex Hurrell is the UK Head of Evaluation at Verian Group, a leading research and evaluation agency worldwide, and home to Verian’s Centre for Value for Money. Contact: alex.hurrell@veriangroup.com
Dr Samuel Franzen is a Senior Expert at Oxford Global Projects, the world’s leading experts on major project management. Contact: sam.franzen@oxfordglobalprojects.com
Julian King is an independent public policy consultant, based in New Zealand. He provides Value for Investment capability-building services worldwide. Contact: jk@julianking.co.nz