Cost model guidance for residential care providers

This is the page for the LD/PD/MH residential cost model guide video. You will have received the cost model itself attached to an email.

While watching the video, you can pause or go back and watch any of the instructions again if you need to.

If you have any enquiries about the video, please fill in the online enquiry form. Questions which may apply to several providers will be published with accompanying answers on this page. Specific questions about your business will be answered directly. 

Further guidance

The information below has been provided in response to questions asked by providers:

Where should depreciation charges for buildings, equipment, vehicles, furniture, fixtures and fittings be shown? 

  • Depreciation charges for fixtures and fittings should be incorporated into the 'repairs and maintenance' cost or if related to specialist equipment, added to this cost instead. Depreciation for vehicles should be added to the transportation charges.
  • In terms of building depreciation and the rent cost, we ask that you make a reasonable assessment of the rental value for the space in the home. While this should take account of any rental or mortgage rates, depreciation, private grounds management costs (if applicable) and the value of the home itself, we have not asked for a specific breakdown of each area. Depending on the value put forward, it may be necessary to demonstrate how this figure was arrived at.
  • If the home is owned, please make an assessment of the fair rental value by assuming an annual % return of the property value. Although this is effectively profit, we have treated this as separate from the pure profit allowance (which does not take account of whether the home is rented, mortgaged or owned outright).
  • The profit allocation is an appropriate amount per bed per week, after all other hotel and management costs have been accounted for. Since no cost items are attached to this figure, please estimate a reasonable rate of return. Please do not include profit in central management fees or management rates as these are treated as separate.

I have a #REF! value appear in some of the total boxes, why is this happening?

The total box is trying to reference a cell which has been replaced by another (hence the ‘REF’ error). This happens when a value is changed by copying and pasting from somewhere else on the sheet. Please change all values by either retyping them directly into the correct box or using ‘paste as value’.