Social Cost Benefit Analysis – a powerful tool for decision making

Abstract Health Impact Assessment provides policy makers with important information about health effects of programs, policies, plans or projects (PPPP). However, PPPP may have many more effects, both positive and negative, direct and indirect, intended and unintended, immediate and in the far future. Ex-ante insights in all these effects may help policy makers to optimize decision-making, but also to communicate realistically to all stakeholders about the PPPP. Weighing effects that may be very different in scale and reach different stakeholders in different ways is inevitable. One powerful tool to help decision makers in this task is Social Cost Benefit Analysis (SCBA). SCBA requires to specify and quantify all effects of PPPP over a specified time horizon. It is also necessary to specify a base-case scenario, i.e. how the problem under study would develop without further investments in PPPP. All effects of PPPP need to be quantified in monetary terms, these can be financial, e.g. healthcare costs or costs of productivity losses, or non-financial, for instance by placing a value of €50,000 on a QALY gained or a DALY averted or a value of €3,5 million on a lost life. PPPP with positive net monetary value are considered welfare enhancing, while PPPP with a negative monetary value do not add to welfare in society. In the Netherlands, government asks any bigger PPPP to be quantified with SCBA methodology. Guidance on unit values for non-monetary effects is given. This contribution will elaborate on results of the SCBA method for different alcohol policy measures, such as increase in excise taxes, minimum unit pricing, closure of vending spots and a total marketing ban. SCBA is a powerful tool to inform policy makers and assist in their decision making processes. It is also a labour and data intensive process that should only be used for larger PPPP investments and not for local decision making.