Although the literature concerning quality assurance (QA) is voluminou
s little information exists about the costs or benefits of departmenta
lly based QA programmes. We measured the direct costs and then investi
gated the financial and non-financial benefits derived from a well-fun
ded QA programme over a period of five years. Data were obtained from
departmental budgets, annual reports of the QA programme, and several
databases used by the programme. The average annual cost was $79,900,
with salaries being the largest component, while $14,300 each year wer
e recovered through the activities of the programme. True costs were h
igher than those calculated since time volunteered by medical staff an
d resources shared with other programmes could not be determined. Some
of the costs encountered at the outset of this programme were later o
ffset by the use of commercial software and employment of volunteers a
nd casual staff Fifty-three projects were identified over the five-yea
r period. Most lacked directly measurable financial outcomes (because
they were based opt education research, patient or practitioner satisf
action). The benefit of the programme has been greater to the departme
nt than suggested from cost analysis alone. Although this programme co
uld not be justified on a simple cost recovery basis, the authors felt
it to be worthy of continued support because of the non-financial ben
efits. However, modification is required to minimize costs.