17.09.19

Prevention: Investing for the future

Source: PSE: Aug/Sep 19

Rob Whiteman, CEO at the Chartered Institute of Public Finance (CIPFA), discusses the benefits of long-term preventative investment.

Rising demand, reducing resource – this has been the rolling landscape of the public sector for the past few years. In this context, it can be difficult to justify allocating limited resources to spend on preventative approaches. However, investing in public health is all about helping people stay healthy, happy and independent for as long as possible.  Good health is an asset – it supports positive social and economic outcomes and reduces demand for related services.  

A clue to the value of prevention is found in the fact that it is often referred to as investment – using resources now to reap benefits in the future, and enabling us to avoid future costs by reducing demand. 

It seems clear that public spending should take account, not only of the immediate outcomes it delivers, but also of its potential impact on financial sustainability. Any cost-benefit analysis of the impact of such investment must, perhaps more importantly, assess the potential impact of not making an investment as well. This is particularly important in preventative investment. Unfortunately, this is not always the case – spending decisions are often taken with an over-emphasis on the short term, instead of considering the broader picture. 

The devolution and health and social care integration agendas both present opportunities for local bodies to work together on the shared goal of improving the health of their communities. This requires a spirit of collaboration, particularly where there is a need to align and agree resourcing priorities. Any interventions must be sustainable within the financial strategies of all organisations so they can continue to be supported over the long term. 

Therefore, it is important that preventative investments are properly evaluated and measured. This not only helps to ensure best value, but also builds an evidence base to increase the transparency of such investments. 

We at CIPFA have partnered with Public Health England to develop a framework to guide such evaluations and analysis. Our approach takes a holistic view, encouraging an emphasis on sustainability and long-term thinking, and allows for a place-based consideration of investments. Such a standardised approach would allow organisations across the public sector to compare strategies and share what works. This would also improve transparency and allow for clear communication with citizens to increase engagement with preventative initiatives, and improve understanding of how and where the public pound is spent. 

Overall, our ambition is to change the way prevention is thought about – as a true investment, yielding benefits across place and time – rather than just a way to generate savings. In realising this ambition, the finance profession will be key. As the people who hold the financial reins of the business, they are responsible for ensuring that scarce public resources are used wisely to secure desired outcomes. We have challenged the profession to not only adopt and empower the changes proposed, but to find a way forward that leads to a step change in the way we think about prevention. 

Although it will take time to change attitudes to preventative investment, our framework aims to take a step in the right direction and start a cross-sector conversation. Making the case for preventative investment now will ensure a lasting impact on public health – and other outcomes – over the years to come.

“It can be difficult to justify allocating limited resources to spend on preventative approaches.”

For more information

www.cipfa.org/evaluatingpreventativeinvestments

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