Sectoral Initiatives under SIF
Towards a Full Economic Cost Model
Innovation & Strategic Impact
The project objective is to scope a university Full Economic Costing (FEC) model and to assess the feasibility of applying the model across the sector. The model will separately estimate the full costs of Teaching, Research and Other activities. The development of FEC is a key requirement for effective management reporting and decision support. It will:
- facilitate more informed management decision-making by providing more accurate and relevant information,
- enhance efficiency and support reform by identifying uneconomic/inefficient areas of activity and by enabling changes to practices,
- support research sustainability by informing the development of an appropriate research overhead rate and pricing decisions (important for EU FP7),
- provide external stakeholders with accurate, relevant costing information,
- enable universities to meet the requirements of the HEA funding model.
Ireland will be a European leader in development of FEC (UK TRAC deals with research only).
Summary
This project represents the first key phase in developing an FEC model for Irish universities, as recommended in the HEA/Forfas commissioned ‘Report of the Group on Research Overheads’ (July 2003).
Stage I: Engage a consultant for detailed scoping of the requirements of, and the designing of a model appropriate for Irish universities, including:
- Information requirements of all key stakeholders including universities, research funders, HEA, etc.
- The model must provide internally useful data and management information for universities and support the measurement and reporting of KPIs (see 2.3.2).
- The information/data requirements of new RGAM e.g. subject price weightings.
- Minimising the administrative burden of the model.
Appropriate cost pools, cost drivers, allocation and apportionment methods for indirect costs/overheads, data requirements of the system and sources of such data will be identified. New systems and procedures may be required to capture the relevant data.
Stage II: feasibility assessment for FEC model implementation, capable of application in all universities. A key deliverable will be identifying potential issues, including IT or systems implications and fully scoping model implementation, including detailed recommendations on proposed cost, timeframe and implementation/roll-out plan.
The consultant will report to an IUA facilitated steering group, composed of university representatives; Bursars, VP/Deans of Research, Registrars, working closely with HEA, research funding agencies and government departments.
Implementation Plan
Stage I – Scoping/Design Phase 6-12 months
Stage II – Detailed feasibility Phase 12-18 months
Deliverables
A recommended FEC model and detailed scoping of an implementation plan.
