Realising Ambition Programme Insights: Issue 8

Published: March 2017 Publication Type: Publication

Show me the money: Full unit cost estimates of service delivery

The Realising Ambition consortium, of which The Young Foundation is a part, are producing a series of 12 Programme Insights rather than writing a long evaluation report at the end of the five-year programme.

Realising Ambition is delighted to announce the launch of its eighth Programme Insight, one of a series of short briefings sharing key learning from the programme.

This briefing builds on previous Insights which explore topics ranging from the value of replication to meeting the challenges of evidence-based commissioning.

In our eighth Programme Insight, we consider the realistic costs of delivering high-quality services for children and young people. It argues that a comprehensive estimation of the costs of service delivery is essential for both commissioners and service delivery organisations.

We explore why realistic cost estimates are important and highlight the dangers of cost under-estimation. We then introduce the key concept of unit cost analysis – including direct and indirect costs – and present our analysis of these across the Realising Ambition portfolio.

We also summarise key learning on cost estimation and implications for both delivery organisations and commissioners of children’s services.

Key learning points include:

  • Understanding the real cost of delivering a service helps ensure that it is viable and sustainable.
  • A firm grasp on costs is central to informing the preparation of competitive yet realistic tenders for potential commissioners. it also helps commissioners know what is realistic within the resources available.
  • Work with children and young people entails a great degree of unpredictability and variation, which can translate into difficulties in estimating one single unit cost. 
  • Direct costs accounted for, on average, just under three-quarters of full unit costs in Realising Ambition projects.
  • Work with children and young people requires careful planning and management, which carries a cost: on average, 47% of full unit costs in Realising Ambition were attributed to this,  with 19% to set-up, 11% to face-to-face time with paid practitioners and 19% to volunteer or non-paid staff time.

About Realising Ambition and our Programme Insights series:

Realising Ambition is a £25m Big Lottery Fund programme supporting 22 organisations across the UK to replicate services aimed at preventing youth offending. Our Insights are designed to support anyone undertaking or commissioning services with a focus on replication and evidence.

Join the conversation

Do you agree with the need to take a broader, more nuanced view of evidence? Share your views, tweet us using #RealisingAmbition or email us to share your thoughts. @BigLotteryFund would also like you to tweet your thoughts on the programme, diverting young people from pathways into offending and funding socially responsible services.

For further information please visit our Realising Ambition project page.

Realising Ambition

Young people (image credit: Catch 22)

Project

The Young Foundation was proud to have been a member of the consortium appointed to manage Realising Ambition, a £25 mi ... → Read More