Resource Allocation Using Economic Principles to Prioritise Projects and Allocate Biosecurity Budgets

Abstract

Biosecurity budgets are unlikely to ever be adequate to reduce all threats to acceptable levels. Because of this, biosecurity agencies must decide on the relative importance or urgency of a large number of biosecurity risks, and which of these will be mitigated using the finite resources available. In this chapter, we outline methods for resource allocation based on the economic principle of value for money. Cost-efficient prioritisation involves understanding the costs and benefits of interventions across the range of pests and diseases that could be funded from a fixed budget. We outline the pros and cons of different prioritisation methods (including net present value, benefit-cost ratio, and optimisation) and assess when each method can lead to efficient budget allocation, depending on the decision context. Finally, we outline barriers and opportunities to increase the uptake of economic principles by biosecurity agencies. When economic principles are followed, biosecurity agencies can undertake the risk-reducing activities that provide the best “value for money” for taxpayers and the community.