A new report ‘The Economics of Accreditation’ commissioned by the Department for Business Innovation and Skills (BIS) has assessed the economic benefits derived from the accreditation of certification, measurement and inspection services.
The objective of the report was to provide a financial evaluation of accreditation’s contribution to the UK economy, which it valued at more than £600 million per annum.
The report carries results from a specially commissioned survey of businesses involved in delivering UKAS accredited services and products. 50% of respondents considered that accreditation provided a marketing and reputational advantage, while a further 16% felt that it was a requirement of their customers and nearly 20% reported benefits in efficiency and service quality from the assessment process.
Based on research undertaken by Birkbeck, University of London, the central element of the analysis is the multiplier effect of accreditation, indicating that UKAS and the other institutions in the quality infrastructure jointly amplify each other’s effects, so leading to an impact greater than the sum of the parts. This set of interdependencies and cross-amplifying effects combine to create a significant financial advantage for those using accreditation to distinguish their products and services.
The survey also showed that there is a widespread ‘willingness to pay’ a higher price for accredited services, reflecting the added benefits. Using these price premia, an estimate of market sizes, and the shares of accredited in total services, the benefits of UKAS accreditation, from this perspective alone, amounts to an estimated £295m.
The report also draws on survey data made available by the National Physical Laboratory to identify a further £320m gained from the contribution accreditation makes to the operation of the National Measurement System and its positive effect on innovation and productivity.
Other substantial benefits, such as the contribution UKAS accreditation makes to public health and safety, trade facilitation and error reduction in industry, remain unquantified. The total contribution made by accreditation to the economy overall is therefore likely to be considerably higher than the £600m identified, possibly as high as £1bn or more each year.
For further information, the full report can be found at http://bit.ly/11xaWrR