(b) VFM Audit
A VFM audit examines whether an organisation, usually in the public sector, provides a service in
a way which is economical, efficient and effective.
Economy
Economy is concerned with the cost of inputs, and is achieved by obtaining these inputs,
everything else being equal, at the lowest acceptable cost.
Examples for BHS may include:
the average salaries of teachers employed at the school
the cost of a kilowatt hour of heating
Efficiency
Efficiency means either maximising output for a given level of input or minimising input for a given
level of output. Basically, it is how well resources are used to produce output. It is sometimes
referred to as doing things right.
Examples for BHS may include:
the number of hours taught per full-time teacher
the number of kilowatt hours of heating per classroom per year
Effectiveness
Effectiveness relates to the quality of output. Effectiveness is sometimes referred to as doing the
right things, that is, producing the output that the stakeholders want.
Examples for BHS may include:
the public exam results of pupils
the average school-time temperature of a classroom during the winter |
