To provide an independent economic evaluation and appraisal of a clustering/collaboration intervention where not all outcomes are immediate and/or quantitative
To make a business case to secure public funding to leverage cluster policies for the successful implementation of RIS3 it is necessary to measure the impact of cluster policies/activities. This presents a number of challenges eg. time lag between participation & outcomes; & the presence of monetary and non-monetary outcomes.
The Financial intervention in cluster/collaboration activities is subject to external evaluation/appraisal. The evaluation reported against the extent to which:
• intervention objectives have been met;
• the Programme contributes to development of human/intellectual/market & social capital amongst participating SMEs;
• the Programme contributes to promotion of wider regional innovation etc.
• the intervention has informed government policy;
• the skills/competences of network facilitators have been enhanced;
• the intervention represents Value for Money
The Economic Appraisal focused on building a business case to determine future funding for the Programme & had as objectives to provide:
• an assessment of strategic context;
• a need for expenditure rationale;
• a range of options for the future;
• an assessment of monetary & non monetary costs/benefits;
• an assessment of risk & calculation of Optimism Bias;
• Net Present Value/Costs & Sensitivity Analysis;
• preferred option & overall Value for Money
As a result of the positive outcomes of the Appraisal a business case was made to secure £5.7m funding to run the Programme for 5 years

Resources needed

Independent consultants were engaged within a budget of £28,000 + VAT to carry out the evaluation and appraisal; in addition, three members of Invest NI staff working on the Programme provided support to the consultants in terms of making additional information available.

Evidence of success

The evaluation and appraisal provided the basis of a strong business case, together with clear evidence of a positive Return on Investment for the NI economy. This was used to secure further funding of further five year roll out of the project with a total budget of £5.7m.

Difficulties encountered

Many projects being evaluated were either not completed, or completed some time ago; it was therefore difficult to collect information on the success of each, particularly where individuals involved had moved on; we are now considering amending our process to allow real-time monitoring/evaluation.

Potential for learning or transfer

It is particularly difficult to assess the economic impact of clustering and/or collaboration activities, particularly the quantitative impact. The approach used by Invest NI can inspire public authorities and the improvement of public policy through offering the following benefits:
• An independent and rigorous assessment of the economic return on investment associated with public funds allocated in support of cluster/collaboration activities;
• An independent assessment of the additionality/gross valued added associated with funding of cluster/collaboration activities;
• An independent assessment and weighting of options for future policy development associated with cluster/collaboration activities, together with forecasts of future return on investment for each option – allowing policy makers to make informed decisions as to value for money outcomes;
• Independent setting of targets/Key Performance Indicators for any future investment in cluster/collaboration activities

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Project
Main institution
Invest NI
Location
Northern Ireland, United Kingdom
Start Date
July 2015
End Date
July 2016

Contact

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