• Home
• About
  • Full Cost Recovery
  • Full Cost Recovery Team
  • ACEVO
• Policy
  • Press
  • Parliamentary
• Resources
  • Voluntary Organisations
    • Benefits of Full Cost Recovery
    • How to Implement Full Cost Recovery
  • Funders
    • Benefits of Full Cost Recovery
    • Other Funders
    • FAQs
    • Funders Statements
  • Case Studies
  • Organisations Trained
    • East of England
    • East Midlands
    • London
    • North East
    • North West
    • South East
    • South West
    • West Midlands
    • Yorkshire
• Links
  • Surer Funding
  • Compact
  • Checklist for Better Funding Practices
  • Contact Us
• Products
  • Full Cost Recovery Publication
  • Full Cost Business Planner
• Services
  • Training
    • Cascading Full Cost Recovery
    • Full Cost Recovery for beginners
    • Individual Budgets
  • Consultancy
•  

Funders' FAQS

• The third sector has suffered from historic underinvestment in capacity, strategy, development, as a result of undervalued projects and services.
• Third sector organisations waste huge resources in generating multiple funding streams to plug the gaps in project funding.
  

In order for the organisations you fund and support to remain sustainable and cost effective, they need to have their full costs of projects and services restored.

2) Organisations won't know their cost allocation in advance: it depends how many projects they run. So how can they know what their full costs are?

It is entirely reasonable to allocate costs on the basis of forecast budgets, rather than on actual budgets. This is standard practice throughout the commercial sector.

As Martin Brookes, Chief Executive at New Philanthropy Capital, has remarked, "This objection does not stand up to any sort of scrutiny. It is opting for paralysis in place of a clear and sensible way of acting."

3) If we pay overheads, won't we end up double funding overhead costs?

A clear and transparent method for cost allocation actually makes double funding less likely. Where certain costs are already clearly funded through other funding streams, organisations can simply remove the relevant line items from their budgets.

Since third sector organisations are not-for-profit, the worst case scenario is that the funder ends up making a contribution towards other work in accordance with the organisation's aims.

4) If we implement full cost recovery, won't it mean that fewer projects will get funded overall?

Responsible funding means funding sustainably, and this has to be on the basis of full cost recovery. Moreover, fully funding project overheads result in economies on both sides, as the principle prevents costs begin disguised and re-ermerging in new forms. This is why leading funders, such as Futurebuilders, and the Big Lottery Fund, are now adopting the principle of full cost recovery.