Costing for a co-located worker?

Q: We have been asked by the lead agency in our consortium to provide them with a costing. In the proposed partnership, the lead agency will employ and pay workers and cover all associated costs. The idea is to "co-locate" the EIP worker at our service (and other like services in the region). On this basis the costing is quite minimal (eg rent/postage/phone etc). It does not seem to compensate in any way for the presence of a worker in our centre. What would you suggest?

A: In considering the situation you are referring to, with the EIP worker co-located in your service but employed by the lead agency, requires some careful thinking to ensure that all the costs to your service are in fact covered. The direct costs like rent, postage and phone may as you say be quite minimal, and should be relatively easy to calculate for the purposes of the EOI, based on your knowledge of your existing costs. However, there are a number of other costs that you may want to consider, including, but not limited to the following:

• Premises costs – remember these are not just rent; they may also include
  - cleaning, rubbish removal, recycling and/or cleaning supply costs
  - utilities (electricity and/or gas), other maintenance to your premises
  - meeting room hire costs or costs of use of space other than desk/office space for program activities
  - staff amenities and kitchen supplies
  - any other costs associated with your premises.
  
  These can be calculated on a percentage basis – the percentage of each of these costs that relate to the EIP project being located in your service.
  
  In relation to premises, you may also need to consider any capital costs associated with accommodating the new worker in your office e.g. building partitions, reconfiguration of space (and the EOI process does have some scope for capital costs to cover this)
  
• Office equipment, furniture etc – you will need to clarify whether your service is to provide office furniture (desk, chair, filing cabinet etc) and if you are expected to provide this, then you can include the cost of purchasing these items.
  
  You will also need to sort out in advance whether the lead agency will provide office equipment (e.g. computer, fax, phone, and photocopier) for use by the EIP worker. If not you will also need to cost in the purchase of these items (see details in the dot points below)
  
• Phone costs – again here, remember it is not just telephone costs – you may also need to consider other communication costs, including whether an additional line is needed on your phone system to cope with additional phone calls (and include set up and line rental costs), cost of facsimile, cost of broadband connection etc
  
• Office facilities costs – if the EIP worker is to use office equipment provided by your service then this needs to be costed in; this could include for example cost of photocopying (maybe a cost per page basis); cost of toner and other consumables for printer, fax etc
  
• Stationery and office supply costs – you will need to determine if your service is to provide these or if they are to be provided for the worker directly by the lead agency. If your service is to provide them then you would need to allow for the cost of additional stationery and office supplies to used by the EIP worker; you could then cost it as a percentage of your total costs for these types of items
  
• Information technology (IT) costs – if your service is to provide a computer and/or IT support, this could include the following costs:
  - the cost of providing a computer for the worker (hardware and software purchase costs), or if you have an existing computer, some contribution towards replacement costs in the future.
  - the costs of IT support (e.g. if you need to bring in someone for technical support, computer setup)
  - the costs of software upgrades (e.g. if you are upgrading the software on your systems, the costs for the computer used by the EIP worker)
  - if you operate on a network, the network administration and support costs (e.g. your admin time in backing up, network admin etc – again, the share for the computer used by the EIP worker)
  
• Administration staff time – you will need to clarify if your admin worker(s)’ time is to be used in any way to support the EIP project worker; if so, this would need to be costed in e.g.
  - if your admin worker is to answer the phone for the EIP worker and take messages
  - if your admin worker at reception is to greet visitors or clients of the EIP and/or provide information on EIP from the front desk
  - if your admin worker is to provide any admin support like doing copying, typing, data entry, etc
  
  If your admin worker is to provide any of the above, or any other admin support, then this time needs to be costed and included. It could be done as a percentage of the total admin staff costs.
  
• Project management and coordination time – the time for your service’s coordinator or manger in liaison with the lead agency re the establishment and ongoing management of the EIP service, participation in any project steering committees, consortium meetings or working parties, preparing accounts, or other involvement in the EIP.
  
  In addition, you would need to clarify if there is any expectation on the part of the lead agency that your service’s manager or coordinator will provide any support or supervision for the EIP worker that will be co-located in your service. If that is the case, then it will also need to be costed in.
  
  These project management and coordination tasks could be grouped together and costed as a percentage management fee.
  

You may also need to look at insurance costs and discuss with your insurance company whether accommodating this additional worker (and any activities that are associated with the EIP operating in your service) may have any impact on your insurance costs, so that they can be included if necessary.

In looking at each of the above areas, you may choose to either work out the actual costs associated with the additional co-located worker or include some or all of them in an overall management fee that is a percentage of your service’s total costs.

You might also like to refer to Tool 2 Checklist for small to medium sized NGOs in forming partnership under Tools and Resources on this website for further information not only on costing, but also on looking at the impact and benefits for your organisation of being part of a consortium.