Transcript Slide 1
Full Economic Costs Staff presentation June 2008 Full Economic Costs (fEC) objectives of presentation • overview of fEC and link to TRAC • to review fEC - the Government costing model for HEIs (in place as since September 2005) • introduce recent changes to fEC and potential impact to department budgets • to discuss how fEC is handled at QMUL • pre-award considerations • post-award matters and reporting Full Economic Costs TRAC Staff presentation June 2008 what is TRAC? It isn’t: Full Economic Costs Staff presentation June 2008 TRAC Transparent Approach to Costing Uses standard methodology for costing our main activities • teaching • research • other Uses staff surveys to allocate academic time Use of cost drivers to allocate space costs and all other overhead costs e.g. Finance Department Introduced to look at the cost of undertaking research. Now it has been expanded to calculate the cost of teaching Full Economic Costs Staff presentation June 2008 TRAC why is it important? It enables the College to calculate the cost of its major facilities in a uniform way It enables the College to calculate the cost of teaching It is likely to be used by the funding council to determine our annual grant It is used to calculate the rates for full Economic Costing Full Economic Costs Staff presentation June 2008 TRAC why is it important? If we do not follow TRAC guidance this is what could happen: Full Economic Costs TRAC Staff presentation June 2008 definition of fEC “A price which, if recovered across an institution’s full programme, would recover the total costs (direct and indirect) of the institute including an adequate recurring investment in the institution’s infrastructure” Full Economic Costs TRAC Staff presentation June 2008 what makes up the fEC? fEC is made up of: • directly incurred costs • directly allocated costs • indirect costs • exceptional costs Research councils will pay a fixed percentage of 80% of these costs as the total grant (excluding exceptional costs) Charities are exempt from fEC and continue to pay full direct costs only Other sponsors have adopted a partial-fEC approach Government organisations have been instructed to pay out at 100% fEC Full Economic Costs TRAC Staff presentation June 2008 what makes up fEC? DI Costs DA Costs Indirect Costs Exceptional Items RAs PI & Co-I costs full indirect costs equipment > £50k lab technicians estates costs PGR stipends travel pool technicians PGR tuition fees consumables & equipment < £50k Full Economic Costs TRAC Staff presentation June 2008 directly incurred costs • research assistants • travel and subsistence • consumables • new equipment – 100% of costs will be paid above a threshold of £50,000 (but only 80% of the £50K below the threshold) Actual costs; can vire between headings Full Economic Costs TRAC Staff presentation June 2008 directly allocated costs • • • • PI & Co-Investigator costs estates costs pooled laboratory technicians use of major research equipment/facilities These are based on estimated costs, not actual costs Directly allocated costs cannot be vired Full Economic Costs TRAC Staff presentation June 2008 PI time • use 1650 hours per year as 1.0 FTE (220 days x 7.5 hours) • include time for project management, writing papers, dissemination & final report writing • use ‘salary bands’ • individual PI time charged to RCs/public funders is not to be double charged, i.e. <100% • need systems for accurate estimating of time required and simple record of time spent e.g. notes/log book, meetings, etc. Full Economic Costs TRAC Staff presentation June 2008 estates cost • separate from indirect costs • the £/fte charge applies to PI, PDRA, Co-I, visiting & PGRA (weighted) • there are different rates for type of space: Estates - classroom rate per fte Estates - laboratory rate per fte – excludes cost of laboratory technicians and Major Research Facilities (MRFs) Three MRFs have been identified – BSU, Genome Centre and Nanovision • will not change over life of project but is indexed for inflation Full Economic Costs TRAC Staff presentation June 2008 indirect costs • includes all central service departments including their estates costs and support time of academics • is a set charge per FTE, recalculated annually • the £/fte charge applies to PI, PDRA, Co-I, visiting & PGRA (weighted) Full Economic Costs pre-award Staff presentation June 2008 eligible and ineligible costs Eligible costs are “project specific, based on actual costs and auditable” This must be explicit within the application/justification of resources Included within the estates/indirects: • redundancy costs • maternity costs • maintenance and insurance costs of existing equipment Need to avoid double counting Facilities costs – QM only just setting up to handle Major Facilities Centres. Running costs of all other facilities already form part of our estates and indirects Full Economic Costs pre-award Staff presentation June 2008 things to note Staff time on projects to ensure 100% DIC Projects that run at a loss need to be signed off Including technical and clerical support on grants • STFC have standard guidelines, other councils vary • departments must ensure that sufficient support costs are being requested • pooled staff and the use of DA vs DI Emeritus status and contract staff • post must outlast project and support given by department during period of grant Joint projects • costings provided by host institutions • costs must be approved by RGA prior to submission Full Economic Costs pre-award Staff presentation June 2008 things to note EU grants are routinely being under-costed and not being passed for internal approval As with UK/OS funding these grants will not be accepted unless the department agrees to pay the shortfall Use of “ball park figures” in outline proposals is not acceptable Audit requirements • must have a complete paper-trail – costing to application form to award to post-award and final reports • PI/Co-I commitments Full Economic Costs Staff presentation June 2008 post-award calculation of internal budget 20% unfunded by the sponsor is supported by the PI/CoI time, estates and indirect costs Residuals are transferred to the dept’s overhead account i.e. XXX1000 Full Economic Costs post-award Staff presentation June 2008 fec award Direct Incurred Staff 129,777.55 113,477.00 129,777.55 Studentship & Fees 48,029.00 48,029.00 48,029.00 Travel & Subsistence 16,074.00 12,859.20 16,074.00 Directly Incurred Costs 12,170.00 9,736.00 12,170.00 0.00 0.00 0.00 43,743.00 34,994.40 43,743.00 0.00 0.00 0.00 Recruitment costs 1,500.00 1,200.00 1,500.00 Other DA - Technician - J Dupuy 2,395.00 1,916.00 2,395.00 10,609.00 10,609.00 10,609.00 264,297.55 232,820.60 264,297.55 allocated staff 19,967.00 15,973.60 est 29,389.00 23,511.20 idc 125,700.00 100,560.00 totals for overheads 175,056.00 140,044.80 Exceptional Items Equipment Consumables Tuition Fees TOTAL DIRECT Total awarded Internal Budget 372,865.40 Overhead Budget 108,567.85 Total Income 372,865.40 Overheads as a % of directly incurred staff 82.14% Full Economic Costs Staff presentation June 2008 post-award financial management of project • planning required by the PI – more accountability • virements between DI and DA costs are not allowed • funds provided for equipment costing more than £25,000 may not be used to buy other equipment, nor transferred to another heading, without prior written approval • DI Staff – Indirect and estates costs are driven by man months and not values as with pre-fEC grants • implications – any reduction in man power will result in a loss of income to the dept • support Staff – DI or DA costs? • DI – Project specific posts – time sheets required for appointments less than 1 fte • DA – Support staff who are appointed over several projects or pool technicians • studentships are funded 100%. It is expected that a student will be charged for the full term of the appointment. Partial studentships to use funds is not acceptable. Full Economic Costs post-award Staff presentation June 2008 activation of grant No change – grant must be activated with the appt of DI staff Non-staff expenditure must not be charged prior to this date Exception – when DI staff costs are not awarded then the grant may be activated by ‘Other DA Costs’ e.g. support staff Note: Starting Certificates must be submitted within 42 days of the start date. Failure to inform RGA that the grant has been activated will result in the grant lapsing Full Economic Costs post-award Staff presentation June 2008 final reports Change – From 1 April 2008 you will need to attach an accompanying document as part of the JeS validation. You will provide a short statement describing whether there was any significant difference between the planned and actual expenditure on the grant, and providing reasons for the difference if this is the case. Full Economic Costs post-award Staff presentation June 2008 sustainability fEC is here to stay – need to recognise implications Loss of income is not an option!