When Your Budget Is the Problem:

Corazon Aquino, Director of Partnerships at Amref Health Africa, led the session, joined in discussion by Mike Naholi Muchilwa, KAFP co-founder and one of Africa's most experienced fundraising strategists. Together, they pulled apart the budget problem from both ends: how organisations undersell themselves getting in, and what it costs them when they do.

The Real Problem Is Not the Budget, it's the Framing.

Corazon opened with a provocation: proposals are rarely rejected because of poor programme design. More often, they fail because of how costs are presented or more accurately, how they are hidden.

She described a pattern she has seen repeatedly. The fundraising team, anxious not to look expensive against competing bids, trims the budget before it goes out. Staffing is costed at part-time equivalents that do not reflect what the programme actually needs. Monitoring and evaluation gets no dedicated line it is assumed to be absorbed by programme staff. Finance, HR, and safeguarding are folded into a flat 5% overhead line that bears no relation to what those functions actually cost.

The result is a budget that looks competitive but is not honest. And when delivery begins, the cracks appear immediately.

One case study from the session illustrated this sharply. An organisation submitted a four-year, multi-site proposal with USD 850,000 requested of which only USD 42,500 was allocated to indirect costs. An indirect rate of roughly 5.3%. The review team's verdict: "The number looked competitive, but it wasn't honest. They priced their own institutional capacity at almost nothing."

The budget was not rejected because it was too high. It was flagged because it looked underbuilt for the ambition of the programme.

Five Tools the we collected.

1. The Full-Cost Confidence Framework

Before a single narrative word is written, finance, programmes, and fundraising need to sit down together not to negotiate with each other, but to rebuild the budget from the true cost of delivery upward.

Separate direct programme costs from the institutional systems that make delivery possible. Cost every function the programme depends on: HR, finance, M&E, safeguarding, communications. Then present the full number with confidence not apology as the price of quality delivery.

Corazon was direct about communications specifically: "If you're not costing for visibility, you are missing your next donor. It's like advertising in the dark."

2. Overhead as a Value Driver

Stop calling it overhead. Start calling it what it is delivery infrastructure, institutional capacity, mission fuel.

The language in a budget matters as much as the numbers. "Event coordination" and "stakeholder mobilisation" describe the same thing, but one is easier for a donor to approve. Show what breaks without these costs. Show what safeguarding lapses, weak reporting, and staff turnover look like when systems are underfunded. Use one concrete story a system investment that protected a past grant's results.

3. The Indirect Rate Negotiation Guide

Walk into every donor negotiation knowing your numbers. Not approximately exactly. Know your institutional cost base. Know your indirect cost rate. Know how low you can go based on a finance conversation that happened before you entered the room not during it.

Corazon's advice on pushback was clear: "Never immediately reduce your rate. Explain it. Show the evidence. Give the stories." Concede on timing or reporting detail before you concede on rate.

4. Funder-Friendly, Honest Budget Blueprints

Budget clarity is not about hiding costs. It is about structure. Lead with a one-page summary of category totals before the granular line items. Group costs the way the donor thinks by outcomes or phases not just accounting codes. Use plain language narrative notes next to complex or high lines. Consistent formatting builds trust before the reviewer reads a single number.

5. Finance-Fundraising Alignment

The fifth pillar generated the most discussion in the room, and for good reason. Finance and fundraising teams operate on different targets one on expenditure, one on income and proposals suffer when they only meet at the deadline.

Build the budget together from day one. Finance validates cost assumptions early. Fundraising validates donor framing early. One shared template. One shared timeline. One final sign-off. And debrief after every submission what caused friction, and fix it before the next one.

What Mike Added

Mike Muchilwa brought the conversation back to something foundational: programme design itself determines delivery costs before a budget line is ever written.

The approach you choose a workshop in a hotel versus a farmer field school at the farm changes the cost per beneficiary entirely. The staff you put in, the partners you work with, the locations you operate in: all of these are design decisions that become budget decisions. And organisations that have not interrogated those choices end up with budgets that either do not reflect reality, or reflect a reality no donor wants to fund.

He was equally direct about the market reality: "Donors are becoming tight-fisted. Big donors are going down the food chain, working with smaller organisations they would not have touched half a decade ago because the big organisations are too expensive."

The answer is not to race to the bottom. It is to be honest about what it costs to run an efficient, effective organisation and to be able to defend that honestly.

"If you cannot deliver value for money and you can't defend your brand, walk away."

The Lines That Stayed....

"The cheapest-looking budget is not the strongest budget."

"A budget is not a spreadsheet. It is a statement that communicates what it takes to create change."

"Don't be scared of donors. The more you do this work, the bolder you get."

"If you work with a good fundi, you call them again. Donors are the same if you deliver, they come back."

"We cannot demand strong accountability while refusing to fund the systems that make it possible."

One Thing to Take Back to Your Desk

For Executive Directors ask finance for the true full-cost figure before the next proposal narrative is written.

For Finance Directors bring your indirect rate evidence to the table before fundraising negotiates it away.

For Programme Managers name the systems your programme quietly depends on, and cost them in.

For Fundraising Teams practice the overhead-as-value-driver pitch on one warm donor this month.

And so the Conversation Continues..

Jackie Mathaga closed the session with a promise: the questions this room raised on budgeting, costing, indirect rates, and finance-fundraising alignment will be unpacked practically and in full at the 32nd Eastern Africa Resource Mobilisation Workshop this November.

There is a masterclass dedicated to this. Bring your budget. Come ready to work.

Early Bird Rates are open now and close in September. Book now to lock in your rate.

30th November - 4th December 2026 | PrideInn Paradise Beach Resort, Mombasa

KAFP Members: KES 76,000 | Non-Members: KES 86,000

Group discounts available for teams, call us for details: +254 718 041 665 / 0790 213 130

🔗 Register here: https://bit.ly/4xtyNZV

The Kenya Association of Fundraising Professionals (KAFP) hosts monthly Coffee Talks for fundraising and resource mobilisation professionals across East Africa and beyond. Become a KAFP Member to access member rates and exclusive community benefits.