6.36 Changes in risks to life or health as a result of government interventions should be valued as part of appraisal and will usually require non-market valuation techniques. The choice of technique will depend on the nature of the specific intervention being appraised.
6.37 The Value of a Prevented Fatality (VPF) measures the social value of changes in risk to life. It is used to value small changes in fatality risks, where levels of human safety vary between options. This is not the value of a life, it is the value of a small change in the risk or probability of losing a statistical life. Not to value this in appraisal would effectively value human safety at zero.
6.38 In cases where alternative levels of fatality risk are involved in option design, VPF allows this to be taken into account. The value concerned is known as the value of the risk of "a statistically prevented fatality." It has been widely used for many years, particularly in transport. The current value and how it may be applied is discussed in Annex 2.
6.39 Valuation can also involve estimating the impact of risks to the length of life, measured using Statistical Life Years (SLYs), and risks to health related quality of life (QoL) measured using Quality- Adjusted Life Years (QALYs). In practice, particularly in the health sector, QoL can be thought of as different dimensions of health (e.g. the capacities for mobility, self-care, usual activities, pain or discomfort and anxiety or depression).17 Observations used will be based on self-reported health and provide equal weight to whatever full health means to each respondent.
6.40 The value of a SLY is derived from the social value of a small change in the probability (the risk) of losing or gaining a year of life expectancy. This value can be of use when appraising options that involve different changes to life expectancy. These risks may involve regulation or provision of goods and services that affect or directly relate to human life and health.
6.41 The gain or loss of a QALY can represent the social value of an improvement in life expectancy and QoL in a way that is comparable to the gain or loss of a SLY. The QALY is two dimensional, combining both longevity and level of health in a single measure. This is useful when appraising options that result in different effects on both longevity and QoL. The current values of a SLY and a QALY, how they can be applied, and background information is contained in Annex 2.
6.42 On grounds of equity in appraisal, the VPF, QALY and SLY values are based on average values from representative samples of the population. For the avoidance of doubt VPF, QALYs and SLYs are used when analysing and planning the provision of assets, goods and services at a population or sub-population level. They are not designed for contexts such as situations of emergency or rescue.
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17 These are dimensions of health as measured using the EQ-5D instrument. This is a tool that individuals complete to show changes in self-reported health over time or before/after receiving health care treatment.