Developing a Cost Benefit Analysis framework

for use with Food/Hazard combinations.

 

 

A project undertaken by University of Canterbury BCom(Hons) students Ryan Lawrence, Ruth Parris and Megan Pettigrew, under the supervision of Associate Professor Don McNickle and Dr Terri Green. The client for the project was Dr Rob Lake from the Institute of Environmental Science and Research (ESR).

 

 

Introduction

Consider the following situation:

A mother slightly undercooks dinner and falls ill the following day. She is too sick to take the children to school or to attend work that day. Instead her husband must take the children to school which causes him to miss a crucial meeting at work. In the meant time, the mother’s health worsens and she calls a friend to take her to her GP, who immediately refers her to the local hospital. She finds she must spend the next three to four days in care whilst she recovers from the effects of the food borne pathogen she had ingested the previous night.

 

This situation occurs frequently with a large cost to society as a whole, both from the utilisation of Public Health resources, to the suffering and inconvenience felt by those inflicted. The aim of this honours project was to create a framework to aid in the reduction of food borne illness cases within New Zealand by proposing a method to allow a user to assess possible interventions to decrease the number of pathogens in food. The potential costs and benefits of each intervention are explicitly stated using an integrated cost benefit analysis.


 

 

Problem Clarification/Definition

The goal of this project was to develop or identify a Cost Benefit Analysis framework to be used to compare different interventions along the supply path of food, from grower to consumer. The framework must be a high or macro level, in order to be general and applicable to many food supply sectors of interest. It also had to be appropriate for use in food safety in New Zealand, which would require either the development of a very specific framework or if a suitable framework was located, adaptation to meet the prescribed needs.

A literature review was undertaken into Cost Benefit Analysis with the aim of finding a suitable framework, if this failed the secondary aim was to gain enough information to be able to create a framework that would meet the client requirements. Thankfully a generic framework was found that had been developed in New Zealand by the Ministry of Economic Development and required some minor changes only to make it applicable to Food Safety. Following this, the framework was applied to a test case of a highly prevalent pathogen and vehicle (food source).

 

 

Framework Flowchart

The following chart needs to be followed through from step one to seven in order to undertake a Cost Benefit Analysis of food borne illnesses.

The status quo needs to be a documented value of the burden on public health of the illness being assessed, measured in DALYs (disability adjusted life years). Some steps require repetition for each option to fully understand both it and the impacts that would be felt, with a non-monetary benefit for food safety measured in terms of a potential reduction in public health disease burden reduction.

Criteria would need to chosen in order to decide which intervention option, or mix of options, would be the best to implement, if in fact any are good enough.

                                        

 

 

 

 

 

Case Study

In order to test the applicability of the framework found and adapted to Food Safety, a case study of a highly prevalent food borne illness within New Zealand was assessed. This was to ensure that the framework would work at a high enough level to cover the whole supply chain, whilst still being capable to drill down to a low level to analyse specific cost components of interventions. The interventions will be tabulated to allow ease of comparison whilst supplying all relevant information needed.

 

Example: High Level table of results

Intervention

Location Implemented

Impacts

Total Cost

Benefit

Ratio

Criteria Met

Option 1

Farm

Consumer benefits

$$$

# decrease in DALYs

DALYs saved

Ease of implementation

 

 

Grower bears cost

 

 

$$$

Quantum of benefit

 

 

Reduction in infection #

 

 

 

Total Cost

 

 

Conclusion

By the time this project concludes, a framework will be ready for recommendation of use by the client in subsequent investigations into possible interventions to reduce the number of illnesses caused by different food/hazard combinations.

As this study is only the first look at this important and relevant problem, the main deliverable of work is the Cost Benefit Analysis framework, instead of recommendations from the case study results, as such only a sample of interventions were analysed as a thorough assessment of all possible interventions could be undertaken in future studies.