Abstract
This paper concerns NPO and government partnerships, focusing on the increasing number of contracts between them that are occurring in Japan. It is said that some NPOs are becoming cheap subcontractors for the government, on the basis of the extremely low contract fees provided by the government. In England, where NPO and government partnerships are promoted, the notion of full cost recovery is applied to NPOs, with recommendations regarding recovering both direct and overhead costs. The aim of this paper is to examine the scope of full cost to be recovered by NPOs and to estimate the full cost amount for three contracts executed in Aichi Prefecture, based on the model case from England and the proposal as prepared by a “Working-level Committee of NPO and Government Partnership in Aichi”. The paper concludes that the contract fees from the government cover only 50–70% of the full cost, as wage rates are not considered appropriate for the service, some project costs are not covered and overhead costs which are necessary to maintain the organization are not included by the government estimates. However, NPOs should also prove a rational basis regarding wage level and overhead costs needed to maintain their activities.
