Value for Money (VFM)

1. Value for Money (VFM) Linda Levin

2. What does VFM mean to you?

4. The 3 ‘E’s • Economy • Price paid for what goes into providing a service e.g. Salaries, buildings, computers, contracts, supplies • Efficiency • A measure of productivity • How much you get out in relation to what you put in • Effectiveness • A measure of the impact achieved • Qualitative or quantitative or both

5. Relationship between the 3 ‘E’s

6. Achieving best possible results by making the best use of resources available.

7. VFM is.... ....The optimum balance between all three ‘E’s • Relatively low costs • High productivity • Successful outcomes e.g. Improved performance, reduced costs, increased customer satisfaction, reduced service failures and waste

8. Comprehensive Spending Review – the proposed cuts • VFM taking on even greater importance • Anticipated reduction in funding as a result of: • Benefit cuts (& increasing cost of living)– potential impact on customers’ ability to pay rent due • Supporting People funding cuts – impact on support services for vulnerable people? • Increasing costs – VAT increasing to 20% on supplies and services bought in

9. Four ways of achieving efficiency • Reduce inputs (level of resources) for the same results • Reduce prices (cost of resources) for same results • Improve results using the same resources • Increase inputs (resources) for proportionate increase in results

10. TSA VFM Standard Specific expectations Demonstrate to tenants: How expenditure is prioritised How VFM is secured and tested Future plans and priorities for achieving VFM Tenant influence services and resultant charges Required outcomes • Comprehensive approach to VFM across all services and national standards • Include details of VFM approach and how commitments will be achieved in annual report

11. Exercise • Please see void process handout • What changes would you recommend to improve VFM? • What outcomes/outputs would you expect as a result?

12. Comparing costs and performance • Does your landlord know the costs of all services provided and activities undertaken? • Are costs and performance compared with other housing organisations? • Benchmarking arrangements – how does your landlord compare with the top performers? What could your landlord do to become a top performer?

13. Comparing costs and performance...cont’d • Advantages of benchmarking: • Provides an insight • Useful starting point in examining VFM • But handle information with care – differences in costs and performance may be explained by: • Different local context e.g. Areas of high ASB/crime likely to have higher costs for ASB services

14. Comparing costs and performance...cont’d • High or low spend on particular services may be in response to tenants’ feedback e.g. Higher standard of communal services and security required by an organisation’s tenants • You need to consider spend and outputs/outcomes when comparing

15. Thank you for listening...any final questions? Linda Levin Email: linda@tenantadvisor.net Mobile: 07967 342436