8. Cost recovery
While CARE’s Emergency Response Fund recognises the need to invest funds when initiating an emergency response, it is CARE’s policy to aim to recover all emergency-related costs as far as possible. This includes initial assessment and response funds, preparedness costs, all emergency personnel, and equipment costs-in addition to normal, CO and CARE Member recoveries.
Checklist
To enable appropriate cost recovery, COs must ensure that:
- CARE’s fundraising targets and strategy are appropriate to the level of cost recovery required. The CO should consider the leverage ratio agreed to for an ERF allocation. The ERF leverage target is 1:6.
- Funding proposals include requests for funds to cover CARE’s assessment and start-up costs (including retroactive requests), which enable the CO to reimburse CARE’s ERF allocations as far as possible. Donors should be asked to cover all costs backdated to the first day of CARE’s response.
- Budgets build in all costs requiring recovery (for example, global response team personnel costs, equipment and assessment costs-refer to Annex 7.11 Budget checklist).
- The eligible start dates to charge funding negotiated with donors are documented in the contract (see Chapter – Donor contract management).
- Funding proposals include all CARE costs, such as CO costs, deployed emergency staff costs and CI Member ICR.
- All expenses incurred using CARE ERF funds are reallocated to contracted projects as soon as possible, so that ERF funds can be reimbursed.
