Governance & Strategic Planning

Supporting Docs, FAQs and Contacts

A list of questions and answers in relation to RA2018 along with the cost driver definitions and supporting documents.

Supporting Documents

The following links contain the documents that define the cost drivers along with documents that support those definitions with further detail.

 

Frequently Asked Questions

The project responsible for the development of RA2018 has involved a large number of stakeholders from across the University.  What follows is a small selection of the most frequently asked questions about RA2018 that have arisen throughout the project team's engagement with the university community.  At the bottom of this page, you will find a link to a document containing a more comprehensive range of questions and answers.

 

Why do we need a new resource allocation model?

It is good business practice to review resource allocation methods every 5-8 years. NPRAS has been in operation now for over 15 years. It has been very successful in encouraging growth in the international student base of the University, thus offsetting the costs of some of our research activities and providing resources for other activities. The University however, uses a range of resource allocation methods and accounts for only unrestricted income, less than half of our overall income.

A key driver for change is ‘gross accounting’ with the objective of allocating resources and reporting on a gross income and expenditure basis.

One of the key principles of the RA2018 methodology is to include all sources of income - research, teaching and other income - in one University of Edinburgh’s resource allocation process. It will provide transparency of where and how income is generated, support the delivery of the University’s longer-term strategic objectives and ensure long-term financial sustainability.

There is also no mechanism currently that accounts for the change in support costs for changes in various income types. That is, we don’t understand, and don’t have visibility of the costs of service provision based on the activities we pursue.

 

What do the components of RA2018 actually mean?

Planning discussions happen at all levels of the University, all year round.  These discussions lead to strategic and operational decisions that impact the inputs into the model. They can include strategic changes to surplus targets, or teaching modes that change services needed.

The decisions and assumptions made at these discussions must be fed into both the Resource Allocation Model, and the Service Expectation Management processes. By inputting this information into the model, the consequences of certain decisions at both strategic and operational levels can be seen. This may lead to further refinements of decisions.

Service Expectation Management refers to the development of understanding between Support Groups and Colleges/Schools about the service and activity requirements to support the strategic and operational goals of the University. Service expectation statements describe the services provided by Planning Units in the three Support Groups, CSG, ISG and USG. Services are categorised into Universal Activity, University Services and Unit Specific Services. Consultation between Colleges and Support Groups is critical to the success of this component of RA2018. The process for the management of service expectations, and publication of Service Expectation Statements is currently under development.

The Resource Allocation Model is the algorithmic component of RA2018. It involves the translation of agreed principles into algorithms that reflect those principles. The core principles to be reflected within the model include income attribution, service types, cost drivers and their weightings, contributions and strategic allocation decisions. RA2018 is not integrating the current Resource Allocation Spreadsheet into RAM that is, it does not financially outline the plans. It aggregates the business plan financials: it does not create the budgets. Each of the Budget Holders will be provided with a Budget Allocation Amount for them to create budgets in whatever way is appropriate to their areas of responsibility.

 

What are cost drivers and how do they fit into RA2018?

A cost driver is the unit of an activity that causes the change in another activity's cost. It is any factor which causes a change in the cost of an activity. For Higher Education Organisations, the most common and significant factors are students, staff, space and a combination of students and staff. For University Services, cost drivers are applied to the weighted volumes of students, staff or space to determine the resources required to deliver the service to the agreed levels.

 

What are service expectations and how do they fit into RA2018?

Service expectation statements describe the services provided by Planning Units in the three Support Groups, CSG, ISG and USG. Service expectations should be set prior to Resource Allocation. It is expected that they remain high level so as to remain manageable within the model, but sufficiently detailed to be meaningful to service providers and users.

These outline whether a service or activity is a Universal Activity, a University Service or a Unit Specific Service. Consequently they determine how cost allocations are determined and allow for Colleges and Support Groups to review the service provision across all layers of the University. Efficiencies or innovations can be identified, understanding can be shared and the overall effectiveness of service delivery can be improved.

 

If NPRAS income is replaced, how will Schools be incentivised in RA2018 and how will their budgets change?

RA2018 is mindful of not encouraging perverse behaviours.  RA2018 will attribute income where it has been earned, apply costs where services have been delivered and allocate resources to Support Groups where they are required.  Strategic allocation decisions will be made to ensure operational continuity.

Furthermore, there is the capability to transparently adjust contribution factors for certain cost drivers or service areas to incentivise the increase of income or the gaining of efficiencies. Colleges will retain the responsibility for setting School budgets.

 

Further questions?

Click on the link below to read a comprehensive list of questions and answers that have arisen throughout the project's lifecycle.

 

Would you still like to know more?

If you have a question that hasn't been answered or would like clarification on an item of interest to you, then contact a member of Governance and Strategic Planning from the list below.

 

Role Name Contact Details
Service Expectation Statements and reviews

Peter Phillips

Deputy Director of Planning

Peter.Phillips@ed.ac.uk

Ext: 508139
Model Developer

Helen Stocks

Senior Strategic Planner

Helen.Stocks@ed.ac.uk

Ext: 502072
Project Sponsor

Tracey Slaven

Deputy Secretary, Strategic Planning

Tracey.Slaven@ed.ac.uk

Ext:  502132