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The use of cost and effect information

Information from cost-benefit analyses (CBAs) and cost-effect analyses (CEAs) is used to only a limited extent in the Netherlands and in some other European countries. By many civil servants, policy makers and politicians - the user group - these instruments are considered a black box and the knowledge which is presented is either unclear or they are made available at an inappropriate time.

Both CBA and CEA concretize the effects of road safety. A CBA expresses all societal effects – both the costs and the benefits – in monetary values. A CEA also uses units other than money, for example road traffic casualties. Both instruments are used in making a of investment decisions in different policy areas, or they are used as a support for prioritizing measures.

Research carried out in a number of European countries (ROSEBUD) indicates that the outcomes of CBAs and CEAs are in fact used in approximately 58% of the northern countries and in 15% of the southern countries. SWOV research has shown that approximately half of the provinces in the Netherlands indicate having an idea of the costs and the effects of road safety measures for 80km/h roads. CBAs are compulsory in decision-making about large infrastructural projects. For this purpose the OEI (Overview Effects Infrastructure) guideline was drawn up in the year 2000.

Certain barriers against the use of cost-benefit and cost-effect analyses (CBAs and CEAs) have proven to be important:

• Researchers and policy makers have different perspectives. Policy makers sometimes reject the economic welfare principles underlying CBA/CEA and make decisions on the basis of more arguments than just the figures resulting from a cost-benefit analysis.
• The position of the CBA/CEA in the decision-making process is ill-timed: the information is not made available at the right time, but too early or too late.
• The way the results of a CBA/CEA are presented does not meet the users' wishes and knowledge. Policymakers sometimes find CBAs difficult to read and hard to understand.
• Policymakers often see CBAs/CEAs as a black box. It is unclear to them which choices have been made in the CBA/CEA, whether an independent quality control was carried out, and whether uncertainties have also been included in the calculations.
• Sometimes there is insufficient, uniform knowledge about the effects of measures.

The following improvements can be made to improve the use of cost and effect information:

• Better timing and presentation of CBAs/CEAs by drawing up a professional code for the relations between policymakers and researchers.
• An independent quality control, either carried out by a separate institute, or by certification. A methodological manual can also improve the quality of CBAs/CEAs.
• A European database on the effects of measures to stimulate the use of uniform and reliable data.

For more details:

Fact sheet Utilization of information on costs and effects (pdf)