How to Build a Better Budget into Your Grant

Published on 21st January 2020

How to Build a Better Budget into Your Grant: Proposal Writing.

Here are some tips for creating a budget that will attract funders and ensure successful grant applications:

1. Ask for a specific budget
Requesting “as much as you can give” does not necessarily endear you to a donor. Instead, it can leave several bad impressions:

a) You do not have enough confidence in your program to believe it worthy of full funding
b) Your budget is either inflated or unrealistic
c) You have not fully thought about your budget and are unsure of the real cost of your program. When you make a request, make it confidently and show you know exactly how much you need.

If you would however like people to give as much as they can towards an objective, state the total cost and give some realistic ranges that people can contribute. E.g. £100-£200, £200-£300 and state what their donation will achieve towards the overall objective.

2. Clear budget headings
It is usually unhelpful to submit a proposal with a lump sum budget amount. You should always structure your budget in a way that helps the funder clearly understand where their donation is going and in what tranches. Budgets can broadly be structured into 4 main categories:

1. Personnel Costs
2. Travel Costs
3. Programme Activities
4. Monitoring and Evaluation
5. Overheads

You should aim for 50% of the budget in the Programme Activities section as this will be looked upon favorably by the funder as good value for money. Although there are situations where personnel cost may be higher e.g. an advocacy project will inherently use up more staff time than a construction project and vice versa.

3. The More Detailed Your Budget, The Better
The first rule of grant budgeting is to follow exactly the format that the donor requests. If there is no specific format requested, then you should do the following:

State the unit cost and quantity with a total at the end. Do not mix up budget lines into the headings listed above. For example, including Programme training activities in the staff costs section because your staff members will be in attendance. Staff training is different from Programme training events if this is relevant to the delivery of the project.

Understand the meaning of the headings and stick with it. You should always aim to include budget notes before you submit the budget. It is unwise to assume that the donor is familiar with technical jargon simply because an agreement is in place to fund your
project.

When you say training, is this training once a month or 6 monthly? What location will the training take place and what deliverable will it be achieving? When you say ‘rent’, is this a contribution towards your HQ office rent or will there be a project office?

4. Align your budget with what is being offered
Donors are usually very clear about what they will and will not fund. Read the call documents carefully, familiarize yourself with the donor and align the proposal accordingly. More Importantly, align the budget with the narrative. A big mistake that we have seen time and time again is a mismatch between the narrative or proposal document and the budget.

For example, a project tried to align with the donors call for clean water in a local district, talks about the total number of families they can reach once their bore hole is built, training on how the local community will benefit from clean water and so on and so forth.

The budget however makes no mention of a WASH engineer, training, engagement in the community mentioned in the narrative and a metric confirming the promised reach. This is a quick way to fail. It is imperative that the budget compliments the narrative.

Findev Consulting Limited is a UK based consultancy that provides grant management training to NGOs and civil society organisation. We have worked with numerous nonprofits across 3 continents, focusing on proposal development, strategic planning and project evaluation.