MODULE 11. COSTING THE SWS IMPLEMENTATION PROJECT

Objective

This module is dedicated to the costing of the mechanism to deliver the SPFs. It aims at identifying the major cost items of such a mechanism implementation and operation (theses cost items might be completed according to the specific design of the intended mechanism). Through the costing example of the Social Service Delivery Mechanism (SSDM) in Cambodia, it provides first-hand experience which could be used as a basis to conduct a precise cost estimation in any country. 

In addition, the module discuss the possible opportunity of implementing a self-sustainable delivery mechanism.

 

Key questions

1. What are the different costs of an impementation project?
2. How are the implementation costs related to the roadmap?
3. How to assess the functioning costs?
4. What are the possible sources of income related to the SWS?
5. Can the mechanism be self-sustainable?
 

Take away message

The implementation of a mechanism to deliver the SPFs is, as any implementation project, subject to two types of costs:

• The investment costs (or project costs) which refer to the implementation itself and are, by nature, non-recurrent; and
• The functioning costs (or operational costs) which are recurring costs that will continue after the implementation project itself (for instance salaries of the case managers).

Investment costs are related to the project, they are either direct or indirect. They are usually concentrated in a short period of time (the duration of the project). They can be represented as a Gaussian curve which shape will vary according to the implementation path. On the contrary to investment costs, functioning costs are linked to the operations of the new mechanism. They are expected to gradually increase from the outset of the project to stabilize at the level of operating the mechanism beyond project closeout.

Regarding the SWS or similar mechanism to implement the SPFs, there are three potential sources of income:

• User fees when receiving a service;
• Selling information/databases to other administrative body and/or private companies such as banks; and
• Fees from service providers – since the SWS will complete functions required by service providers to perform their operations, it can be seen as a service.

However, while the self-sustainable approach can be developed for administrative services, it might not be relevant when it comes to the provision of social services. Financing the social protection system is the responsibility of the Sate, especially when it comes to social assistance.

Master Module 11

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