Value For Money Financial Management In The Public Sector

Quite a number of citizens are reluctant to pay taxes to authorities due to lack of demonstrated value-for-money. There is broad consensus that
development funds should be used as effectively as possible. Donor agencies and governments, tax payers, partner country governments and
citizens all want aid to work as well as it can and agree that limited aid budgets need to be well targeted and managed. Policy makers want to see clear numerical evidence of the best possible value for money in all areas of government expenditure, including development co-operation.

Value for money has become more prominent on the development agenda for a number of inter-related reasons.

• Development community has in the past been driven by performance criteria that are very different from those in other areas of public spending: how much is spent sometimes overshadows the more fundamental question of what the funds achieve;
• Aid agencies are increasingly expected to understand and demonstrate the value for money of their work to those who are paying the bills, i.e. tax payers;
• A number of aid skeptics have claimed that aid does not work, is wasteful and should be downsized or abolished;
• Although these claims may not always be based on evidence, strong evidence is needed in order to demonstrate that aid is valid
  and managed well, and that those in charge of aid are constantly seeking to make it work better.