Costing OVC in Ethiopia: Making sense of the numbers
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1 Costing OVC in Ethiopia: Making sense of the numbers Priya Emmart International AIDS Economics Network, Vienna July 16, 2010
2 Authors Principal Authors Tekale, Daniel S. and Forsythe, S. Conducted with the support of USAID Ethiopia and 20 Implementing Partners including national and international NGOs, Idirs and FBOs.
3 The Ethiopia OVC context in % of Ethiopia s total child Population Over 80% live in rural areas ~900,000 children orphaned - HIV and AIDS 5% of households with OVC = receive free external support
4 The Costing Exercise: Objectives To assess the range of unit costs of PEPFAR supported OVC programs in Ethiopia To identify costs of key services such as educational support, health care, food support
5 The Costing Exercise in Ethiopia, 2009 Two day costing training To familiarize implementing partners with the planned costing approach To identify key OVC service areas OVC costing survey of 20 PEPFAR-supported organizations Scale, Magnitude and Location of services Interviewed programme planners, budget officers From budget reports, financial audits Donated items local market price
6 Costing Methodology Quantification of inputs Labour, Materials, Equipment/furniture, Travel, Building/Land, Office Supplies & Utilities Costs apportioned By proportion of direct costs consumed for each service Values for volunteer labour and other donations Major Capital items discounted at 5% p.a. Building/Land costs approximate market rental value Cost per OVC = Total costs per service/# receiving service Economic and Financial Costing
7 Key Services Costed Education support Scholastic material, school uniforms, tuition waivers, tuition, private school Food & Nutrition Daily meals, Therapeutic feeding, Community Events, Information Economic Strengthening Training, Vocational Skills, Start-up Capital for Guardians Shelter & Care Home renovations, community mobilization, institutional Health Care health education & linkages Psychosocial Support Counseling, sensitization, targeted support Legal Support - Birth registration, Wills, Legal Education
8 In Ethiopia, Food Support is the key expenditure Total Cost by Key Service Area ( USD millions) Organizations offer a range of 4 to 8 services Food and Nutrition Education Economic Strengthening Shelter & Care Health Care 38,743 clients supported Services vary by intensity & frequency 12 month period prior to July Sept Coordinated Care Psychosocial Support Food and nutrition services 47% of all expenditures Legal Support Costs not differentiated by education levels or age of child or type of orphan
9 Materials and Labour use largest share of Resources Costs by Resource Type 1.40% 1.30% 5.30% 3% Materials Labour 25% Transport Building/Land 64% Equipment/furniture Utilities Materials represent 2/3 rds of Total Costs Food Uniforms School supplies Labour & Materials combined are 4/5 ths of Total Costs Cost findings similar to studies in Rwanda and Zambia
10 Volunteer Labour may mask future costs 80% 70% 60% 50% 61% 73% Full & Partial Costs by Resource Type Excluding Volunteer Labour Costs Key resource costs Material, Labour & Transport 40% 30% 28% Full Cost Partial Cost 50% Reduction in Labour Costs 20% 14% 10% 0% 6% 7% 2% 3% 1% 2% 1% 1% Labour represents 58% of Total Costs
11 Cost per child varies considerably $6 $6 Cost per Child (USD) $3 $1 Economic Strengthening Food & Nutrition Unit cost differences Range from $36-$423/ OVC Target size # of Service Areas $33 $77 $23 $151 Shelter Care Education Health Care Coordinated Care Lower costs associated with Geographic concentration Bulk purchase of food Tuition waivers Psychosocial Support Non-Institutional Care Legal Support Economic Strengthening, Food & Nutrition, Shelter Care key drivers of cost per child
12 $80 Per OVC served? Services provided are not comparable in terms of type, intensity or quality Cost of service high while numbers served low for some services high unit costs Scale and location matter Inverse relationship between numbers served and unit cost Urban vs. Rural populations
13 Recommendations Important to consider quality and effectiveness of services in scale up Use of 2008 QAI standards Availability of volunteer labour and donated items key considerations for Scale Up in Ethiopia
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