Learning from grant evaluations

In the period from 2005 to 2009, only 81 of the 633 available grant schemes were evaluated. In most of these cases, their effectiveness was not evaluated. Where effectiveness was considered, the evaluations were rarely sound: they did not explain whether the grants were effective or not. Since grants are rarely evaluated soundly, their effectiveness is usually unknown. The principle adopted by the Rutte/Verhagen government that grants to support businesses and entrepreneurs will be awarded only if they are proven to be effective is therefore not being honoured. The poor evaluation of grants can have adverse consequences. There is a risk of ministers taking decisions to continue a grant scheme, for example, on the basis of unsubstantiated information on its effectiveness. There is also a risk of ministers submitting unsubstantiated information to the House of Representatives on a grant's effectiveness. We found that these risks also occur in practice. Ministers have used the findings of weak evaluations to take decisions on the continuation of grants. All the evaluated grant schemes we investigated were continued in the same or adapted form. The information the ministers provide does not give the House of Representatives a true picture of the effectiveness of grants. The House is not informed of all grant evaluations and in some cases the information is coloured: ministers sometimes report only the positive points of an evaluation. The quality of the Government Grant Review 2010 also displayed weaknesses.

We recommend that all ministers soundly evaluate the effectiveness of all the grants for which they are responsible and use only substantiated conclusions on their effectiveness to adapt policy and to account to the House of Representatives. We also recommend that, in principle, the ministers withdraw all grants that have been evaluated and found to be ineffective. If ministers decide in such cases that a grant need not be withdrawn they must submit their reasons to the House in accordance with the ‘comply or explain’ principle. 

The Minister of Finance should set substantive quality criteria for the evaluation of effectiveness. We further think the Minister of Finance should publish an annual report on government grant schemes, presenting specific information on each scheme, for example the objectives, the start and end dates, all evaluations planned and conducted and their outcomes (including references to the evaluation reports in question). Individual ministers should then publish accessible, accurate, complete, up-to-date and consistent reports on ministerial grants.

The Minister of Finance believes more transparent and more frequent information on grants will be provided to the House of Representatives when an overview of grant schemes is appended to all ministerial budgets as part of the 'accountable budgets' operation commencing in the 2012 financial year. The minister does not agree with our recommendation to set substantive quality criteria for evaluations of effectiveness. The minister does not support the introduction of a rule to withdraw grant schemes, in principle, if their evaluation is negative.