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Budgets and project revisions

How to draft an SHF Budget?

Through the budget, the SHF partner demonstrates how funds will be used. Cost estimates should be fair and transparent. To limit time spent on budget revisions, it is important that costs are broken down as much as possible and explained in the remarks box of the budget.

Different types of costs

An SHF budget has three types of cost: direct, support and programme support.

Budget lay-out

The budgets provided in the ERRM concept notes and RfE Cases for Funding should provide a succinct overview of the categories, indicating the costs of the main activities, support costs, PSC and total cost. When submitting the proposal in the Grant Management System (GMS), a more detailed budget is required.

Budget elements

The budget line description should briefly describe the cost and the location where the project will be implemented. If the project has more than one cluster, the relevant cluster name should be mentioned for each budget line. In the case of joint costs, the relevant cluster and the percentage of each cluster line should be specified.

Budget categories

There are seven budget categories – see as well annexed box:

  1. Staff and other personnel costs
  2. Supplies, commodities, materials
  3. Equipment
  4. Contractual services
  5. Travel
  6. Transfers and grants to counterparts
  7. General operating and other direct costs

Breaking down budget lines

Large activities must be split into separate budget lines. In the remarks box, these budget lines should provide a detailed calculation and technical specifications or should refer to an Excel table with a budget breakdown uploaded in the GMS ‘document’ tab. All amounts in the remarks box or attached sheets should be in US$. Excel sheets with breakdowns should be named after the budget line code (e.g. 2.1, 4.2, etc) and not the budget line description.

Maximum budget amount

NGOs must provide a budget in line with the SHF operational modalities, within their risk level. Maximum amounts per risk level:

  • High risk
  1. Less than 7 months : $250,000
  2. More than 7 months : $400,000
  • Medium risk
  1. Less than 7 months : $500,000
  2. More than 7 months : $700,000
  • Low risk
  1. Less than 7 months : $1,000,000
  2. More than 7 months : $2,500,000

Individual NGOs with a high-risk rating are allowed to hold a maximum amount of $500,000 in active grants at any one time. Active grants are calculated as grants under implementation at the time of an allocation (estimated date of grant agreement signature as per Allocation Strategy timeline). Partners who are near that ceiling will have to ensure previous grants have either been closed or under final reporting or auditing before they can request additional funds.

High-Risk partners that have never implemented an SHF project can apply for a maximum amount of $250,000 (total grants) the first time.

Partners can request their current risk level status by sending an email to shfsudan@un.org.

Other tips

  • In GMS, the percentages of the clusters on the cover page of the proposal should indicate the actual costs per cluster component over the overall sub-total of direct and indirect costs. Once the budget is drafted, these percentages should be checked again.
  • Disbursement schedules depend on the risk level, project duration and project value. The schedule figures are in table 7, Operational Modalities, in the SHF operational manual.
  • Financial reporting is required before each disbursement, by the 31st of January, as well as part of the progress report and the final report.

 

Resources
Guidance note 8 – How to draft a budget