1.3.1 Appraisal itself uses up resources. The effort that should go into it and the detail to be considered is a matter for case-by-case judgement, but the general principle is that the resources to be devoted to appraisal should be in proportion to the scale or importance of the objectives and resource consequences in view. Similar principles apply to ex post evaluation.
1.3.2 Judgement of proportionate effort should take into consideration the totality of the resources involved in a proposal. However, particular weight should be given to the TOTAL PUBLIC FUNDS involved, since it is primarily for these that public bodies are accountable to the taxpayer.
1.3.3 It is also important that the appraisal is appropriate in the sense that the correct methodology is used and tailored to suit the case in hand, because there are variations in how the steps of appraisal apply in different spending areas. Judging this is a matter of experience and SGHD economists should be consulted where there is any doubt.
1.3.4 Irrespective of the amount of effort applied, appraisals should normally seek to take account of all the costs and benefits arising from a proposal, whether they fall to the public sector or to other sectors of the economy. This is because the general aim is to make best use of all the resources in the economy. However, some appraisals are more restricted in scope, as is explained at 1.5 below.
1.3.5 Appraisal is a way of thinking which is indispensable even when dealing with small amounts of expenditure or resources. It is always appropriate to establish the need for a proposed expenditure or change of resource use, consider alternative options, and weigh up the costs and benefits of the alternatives. However, small scale decisions do not require as much appraisal or evaluation as larger scale decisions. Appendix 1 provides practical advice on how to decide the proportionate appraisal effort when dealing with small expenditures, including the use of pro-formas.