Economic benefits of accreditation valued at more than £600M a year
A new report 'The Economics of Accreditation' commissioned by the Department for Business Innovation and Skills has assessed the economic benefits derived from the accreditation of certification, measurement and inspection services.
The National Physical Laboratory (NPL) was one of a number of businesses that worked with researchers from Birkbeck, University of London and the United Kingdom Accreditation Service (UKAS), to create the report. Its aim was to provide a financial evaluation of accreditation's contribution to the UK economy, which it valued at more than £600 million per annum.
A central element of the analysis is the multiplier effect of accreditation, indicating that those involved 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 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.
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 NPL specific, survey data, 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.
Despite these ground breaking results, the authors acknowledge that the report represents only part of the story. Other substantial benefits, such as the contribution 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.
A summary of the main findings can found in a Summary Report
Full details can be found in the report: The Economics of Accreditation
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