Programme budgeting and marginal analysis: an approach to priority setting in need of refinement.

Programme budgeting is enjoying a revival in the British National Health Service primarily because of its recent coupling with marginal analysis. As well as providing a means of mapping activity and expenditure from the institutions providing care to the population receiving it, programme budgeting and marginal analysis aim to assist strategic planning by indicating where net benefits might be increased by reallocating spending within programmes. However, the method to achieve this is not yet sufficiently refined and results to date have been mixed. In particular, the approach to identifying options for evaluation is flawed because of the importance attached to the role of 'expert' groups. A more systematic technique is suggested to overcome present methodological deficiencies.