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Financing and Management
Operational costs
According to projected estimations the operational costs in Hungary will secure significant savings, since wages and living costs are higher in Western Europe. In turn, the expected faster growth of real wages in Hungary will result in the next decades in an about 0.3 - 0.4 percent per year above inflation increase of the operational costs. On this basis the estimated operational costs will reach 100 M€ per year (at 2007 value) by the mid 2020. The operational costs in Hungary will initially reflect some savings, due to the higher wages and living costs in Western Europe. In turn, these costs in Hungary will increase with time about 0.3 - 0.4 percent per year faster, to reach 100 M€ / year by the mid 2020s (at 2007 value), due to the expected somewhat faster increase of local real wages than in more developed parts of the EU. This differential increase of wages only applies to contracted services, since the compensation of ESS employed staff will be based on the most competitive comparisons within Western Europe, for which ILL was considered as a reference in the costing calculations. The operational costs include, in addition to adequate manpower, yearly 15 M€ capital investment for adding on average 1.5 - 2 new instruments per year in the first years of operation and regularly replacing older instruments later on. Operational funds will be covered by yearly contributions of the shareholder countries in proportion to their usage rights. In sum, a partner with a 10 % share will have paid a total of 165 M€ contribution (at 2007 value) in rather uniform installments (after an initial gradual ramp up to a peak around 2014) over the first 16 years of the ESS project in Hungary, i.e., between 2009 - 2025, by which time, 8 years after producing the first neutrons for 10 instruments under commissioning, full capacity will be achieved with 22 instruments available for user service. |
