grants and grant agreements luc t’joen eurostat, a-5

Grants and Grants and grant agreements grant agreements

Luc T’Joen

EUROSTAT, A-5

2

Objectives of the training

• To know the background• To understand the key

legal and financial aspects of grants and grant agreements in the area of PHARE

• To appreciate the advantages and the obligations of the grants system

3

Programme

• Background

• Changes in the procedure

• Grants details

• Practical information

• Action based grants

4

Programme

• Background


• Grants details



5

Background : political overview -> the road to Europe

• Copenhagen Summit (1993) : conditions to fulfill for membership (called “criteria”)

• Essen Summit (1994) : pre-accession strategy based on Europe agreements, a PHARE programme of financial aid and a structured dialogue

• Luxemburg Summit (1997) : opening of negotiations with CZ, EE, HU, PL, SI and CY

6

Background : the road to Europe

• Berlin Summit (1999) : establishment of the financial provisions until 2006 permitting enlargement (6 countries more)

• Helsinki Summit (1999) : - compliance to Copenhagen criteria = prerequisite for start of accession negotiations - opening negotiations with BG, LV, LT, ML, RO, and SK.- TU = status of candidate country

7

The road to Europe• Nice Treaty (2000) (not ratified yet) :

- amendment of internal functioning to a bigger Europe (e.g. majority decisions; one Commissioner per country; redistribution of EP seats)- “road map” for enlargement negotiations with sequenced approach using chapters- ratification : IRL referendum !

• Goteborg Summit (2001) : - enlargement is irreversible- participation to 2004 elections possible

• Laeken declaration : - European Convent (2001) in which all CC take part

8

The road to Europe• Copenhagen criteria : stability of institutions,

functioning market economy and ability to take on the obligations of membership including political, and EMU

• Acquis communautaire : detailed laws and rules adopted on the basis of EU’s founding Treaties (Rome, Maastricht and Amsterdam)

• “Differentiation” principle : each country will be judged on its merits (best prepared countries progress more quickly in the negotiations)

9

The road to Europe

P re -access io n s tra tegy- E u ro pe A g ree m e n ts- A cce ssio n P a rtne rsh ip s + N P A A S- P a rtic ip a tio n in E C pro g ra m m es

A ccessio n n eg otia tio nsRoad m ap- C h a p te r 1 2 fo r s ta tis tics

C o m m u nicatio n s trategy- d e ce n tra lisa tion- f le x ib ility- syn e rg y

Preparation for en largem ent 3 b a s ic T ra cks

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The road to Europe• “PHARE” = financial aid via Council Reg 3906/89 and

its subsequent amendments> annual financing decision by the Commission after consultation of the Phare Management Committee followed by Financing Memorandum with each of the CC> implementation via National Programmes (80 %), Multi-Beneficiary programmes and cross-border co-operation programmes

• for statistics = financial aid via National Phare programmes (for IT) and via Multi-Country Phare Programme in Statistics (1994, 1997, 2000)

11

The road to Europe• Budgets used for “PHARE Multi-Beneficiary

Programmes” - 1991 : 3 Meur- 1992 : 2,5 Meur- 1994 : 17 + 1,2 Meur- 1997 (3 years 97-99): 12 Meur- 1998 (until October 2001) : 5 Meur- 1999 : 15 Meur- 2000 : 8 Meur- 2001 : 7,39 Meur- 2002 : under preparation (9 Meur)

12

The road to Europe• Statistical cooperation programmes :

- institution building- transfer of know how- establishment of sustainable statistical systems- implementation of European standards and methods

• from demand-led (management by NSI of countries with “liaison group” with secretariat in Vilnius) to accession driven (financial instruments have to support activities relevant to accession)

• PCU (Programming cooperation units) : identification of weaknesses and suggestions for solutions to overcome and improve (for statistics in Vilnius)

13

The road to Europe - statistics• Negotiation Chapter 12 : Statistics

> All countries fulfilled the criteria ; chapter closed and no transitional arrangements accepted

• no problem to legally adopt the acquis but help needed to produce accurate and harmonised data in a permanent and sustainable way

• quality of statistics depends on * general administrative capacity* public service performance* capacity to recruit and retain qualified people

14

The road to Europe - statistics• PGSC : Policy Group on Statistical Co-operation

Phare : agenda with more policy related issues and focusing on strategy and statistical issues Next meetings : Oct 2002 (Ljubljana) and 2003 (Tallinn); participants : Heads of NSOs

• MGSC : Management Group on Statistical Co-operation Phare : more focused on management, procedural and financial issues resulting from policy decisions; participants : Directors of international departments and MS

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The road to Europe - statistics• Global assessments : assessing the capacities of the

systems available on the basis of comparable functional information by high level staff of the MS > assessments of - legal compliance level with acquis communautaire

- administrative capacity of countries in statistics field- technical aspect of statistical system in the countries

>> no “ranking” of countries as systems not fully comparable (differences in size, organisation, ..)

• Sectoral assessments : assessing more technical aspects of statistical production specific sectors (eg. agriculture, Prodcom, STS)

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The road to Europe - statistics• Compliance database : information system to

facilitate the monitoring of the compliance level of the Phare countries with the acquis communautaire (via private contractor Programme secretariat)

• 4 main parts : acquis communautaire (reference to legal and technical matters), self-assessments (input by countries), external assessments (input by external experts) and combined assessments

• Statistical requirements compendium (3rd edition-2002) : exhaustive reference document for acquis communautaire, incorporating legal acts, methodology, background information, statistical agreements and legal acts in preparation per three digit module

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The road to Europe - statistics• ESS (European Statistical system): views of CC

on medium term vision to be presented in DGINS Palermo (September 2002) as a result of the Madrid session of June 2001

• DGINS : forum for informal reflection on issues of strategic nature

• SPC (Statistical Programme Committee) : progressively higher involvement of CC with indirect participation via the SPC Network Group

• CSP (Community Statistical Programme 2003-2007) : to provide the EU with a high quality statistical information service

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PHARE multi-beneficiary programme in statistics for 2000

Private contractorsp ilo t p ro je c ts3 .5 00 .00 0 €

Direct grantsto ca n d id a te co u n tries

1 0 x 3 6 0 .0 0 0 €

EU m anaged grantsto M S a n d m u lt ila te ra l e ve n ts

a p p rox . 9 0 0 .0 0 0 €

PHARE 2000S ta tis tica l o p era tio ns

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Programme

• Background


• Grants details



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--> Before 2002 ..• Action proposed (within the annual WP)

Eurostat A-5 agreement

Private company to make contract and take care of administration (intermediary) with partial subcontracting to NSOs

Action to be done

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From 1/9/2002 onwards

• Action proposed (within the annual WP)

Eurostat A-5 agreement (direct award to CC with financial management in Eurostat via grants)

Action to be done

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Advantages• N.S.O. in the CCs = direct beneficiary :

- winning time : no intermediary (so quicker and clearer communication) - and money : higher cost-effectiveness of public money

• preparation for the future = delegation to beneficiaries enabling them to manage directly the grant programme (same instrument as for actions done by the Member States)

• Co-financing = contribution in kind• role of central coordinator in the country

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Consequences

• new responsibilities and work : -> invest in correct management of financial aid (human and financial resources, central archiving)-> invest in programming and prioritising -> invest in time to follow up and evaluation (mid-term and ex post) > keep information updated and central-> invest time and resources to collaborate with other national bodies and to control execution

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Consequences

• Direct responsibility for NSO > change in - organisation for management and control of the grant- human resources and planning practice>> Done ? How ? Problems not yet solved/ Questions remaining ?

• Period applicable of this grant = 12 months but will be in future continues to be the means to co-finance expenditure

25

Programme

• Background


• Grants details



26

What is a grant ?

• A grant (or subvention) = a direct financial contribution of non-commercial nature to a non-profit making beneficiary to finance an operation to help achieve an objective forming part of the European Union policy

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Grants details - the rules• Practical Guide to PHARE Grants

Procedures (Part I of the detailed presentation)

• Standard model forms (application form, grant agreement form) (Part II of the detailed presentation)

• Commission Vade-mecum on Grants management (Part III of the presentation) for Eurostat action grants -> last part of the presentation

28

Grants details - the rules• Practical Guide to PHARE Grants

Procedures (Part I of the presentation)

• Standard model forms (application form, grant agreement form) (Part II of the presentation)


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Practical Guide to PHARE Grants Procedures

• Management by Phare beneficiaries

• Management by the Commission

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Management by PHARE beneficiaries

• * Participation in pilot project’s meetings, seminars, WG and study visits

- most important part of expenditure- Costs = eligible travel costs and per diem- Accountancy of costs incurred to be done by the beneficiaries with a follow-up of expenditure by the Commission- Participation to PP/seminars/WG in principle

limited to 1 expert per country- study visits generally limited to max 2 persons and 10 days

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Management by PHARE beneficiaries (2)

• * secondment of trainees : idem (travel costs + per diem*Training courses : idem + training fees are also eligible* In-country training courses : organisational costs or package “all-inclusive” (costs can be split if multi-national character)* multi-lateral events : from contingency reserve

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Management by PHARE beneficiaries (3)

• > no management cost reimbursement possible = public co-financing> not only for NSOs ---> also Ministries and other public bodies : provisions to make internally to incorporate other bodies as well> ex post audit needs :

- proper organisation and good financial reporting capacities- systematic reports for all expenditure (audit cost = eligible)- information to Commission of nomination of auditor (should

not be a public body)

33

Practical Guide to PHARE Grants Procedures for

Eurostat

• Management by Phare beneficiaries

• Management by the Commission

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Management by the Commission• Financial management of central grant to MS :

travel, per diem and honoraria to be paid to MS (EFTA) experts (public but also private) for study visits : central management by Eurostat via :

- a call for proposals and - a grant agreement per MS on the basis of the

earlier programming indications if accepted as priority by the Commission (indicating the various actions for the next 12 month period)

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Management by the Commission• * programming, publication, selection and

awarding of all grants both to Phare countries as to MS for Phare actions

* Follow up (operationally and financially) of decentralised grant amounts : via Multi-country list and financial forecasts

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Grants details : the rules• Practical Guide to PHARE Grants




37

Standard application form• Detailed examination of the PHARE model (see handout

1) (different from general “AIDCO” model) with :- information details to be added on * the project (I), * the applicant (II) , and a declaration by the applicant (III);- Annexes : 1. Budget (handout 2) and 2. Financial ID form (handout 3)

• Examination of the guidelines for applicants (handout 4) • Signature and date by the person competent to commit

the beneficiary organisation

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Standard grant agreement form• Detailed examination of the PHARE model (see handout 5)

with the most important articles of the special conditions : * duration (art. 2), * payment arrangements (art. 4) , * reports (art. 5),* the specific terms (art. 9);as well as the Annexes :* I. Technical description of the operation (handout 6), * II. General conditions (articles 6-9 and 14-17) (handout 7)

* III. The Budget (details later)* IV. Standard payment request (handout 8)

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Grants details : the rules• Practical Guide to PHARE Grants



• Commission Vade-mecum on Grants management (Part III of the presentation) for Eurostat action grants - > last part of the presentation

40

Programme

• Background


• Grants details



41

Practical information

• Operational rules - Tasks of the beneficiary- Tasks of the Commission

• Financial rules - daily allowances + examples- travel costs + examples- other costs in detail- supporting documents

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43

Operational rules• Procedure :

The beneficiary must :- select staff and arrange for its participation in the activities of the programme - request for Commission approval to organise specific actions (includes draft and send ToR)- organise approved actions and, on occasion, provide assistance in the elaboration of these (eg. booking flights for trainees)- request for prior Commission approval for any deviation from the original plan (with a justification)

44

Tasks of the beneficiary (2)• - organise automatic procedure for sending each month

copies of mission reports (in EN) to the Commision to ensure correct operational management (no handwritten reports) - report (in EN + on paper and electronically) on* activities : elaboration of a detailed WP within the general Eurostat programme + regular update* budget consumption : breakdown of costs* financial problems (to foresee : = in advance !)* suggestions for improvement of the programme* other issues, if requested by the Commission.

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Tasks of the beneficiary (3)• Reporting details :

- each month, present a 3-monthly rolling forecast with new activities planned + financial forecast for these + any cost update (= monthly work plan) and a copy of the mission reports > a 10 days tacit agreement- send a quarterly report to describe the work carried out with a distinction between activities achieved and activities currently under way + financial forecast and budget consumption (needs Commission approval) (also a 10 days tacit agreement)

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- to back up a payment request after 70 % consumption of advance, transmit an interim report with detailed description of work carried out, results obtained, resources mobilised and progress assessment- a final technical report (3 paper copies and electronically) within 3 months after the completion of the operation (and with a 2 months tacit agreement period) :* summary of activities (completed and ongoing)* general progress and problems encountered* final conclusions and * recommendations for the future.

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- provide the Commission with interim financial reports with the following information (on paper + electronically via e-mail or on diskette) :* use made of the funds made available* confirmation of the bank account position* only for activities for which all the covering invoices are available and archived with a reference number (NO documents to be sent !)* additional notes for specific cases (cancellation costs, medical certificates for illnesses, upgrades to business class) - provide the Commission with a final financial report with identical information to receive the balance of the grant

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Reports

An

nu

al c

ycle

Quarterly reports

Final report

2 0 0 2 GRANT

START

June 02 1/9-30/11/02

3xWP 3xWP 3xWPNEW

GRANT

2003 g r an t

1/9 : start of

operation

Preparation

Signature of grant

3 x Monthly WP

Interim report : 70 % of advance spent

•Monthly WP for 1st quarter

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Tasks of the beneficiary (6)• - ensure an analytical accounting system respecting the

sound financial management and European and local accounting rules with details on activities (referencing the data and supporting documents) and reporting on budget consumption- allow Commission representatives during the implementation period to monitor, supervise and assess performance of the grant agreement- attend Commission organised events on the implementation of PHARE agreements

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Tasks of the beneficiary (7)

• - allow on the spot access to the auditor to certify the accounts of the operation and assist him in his tasks (by making available all the information needed)

- allow on the spot access to the Commission or other bodies to control ex post the use made of the grant (by making available all the information needed)

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Tasks of the Commission (1)

• Procedure :The Commission must do the necessary actions to coordinate and manage actions with a view to implement the Phare 2000 programme. This, includes, amongst others, to : - provide for a clear understanding by the beneficiary countries of the contractual relationship and the responsibilities linked to the grants scheme;- make advance, interim and final payments on time (usual payment scheme 40/20/40) here exceptionally 70/20/10 to bring in positive cash element;

53

Tasks of the Commission (2)• - approve financial statements sent in for intermediate

payments as soon as 70 % of advance (half of the grant) is spent- check the reports sent by CC and approve or propose amendments within the deadlines provided for; - examine and give approval to proposals for specific actions and to deviations from original planning;- check the proposed amendments for the future cooperation;- check the financial forecasts and budget consumption; - give assistance by way of training and advice on how to correctly implement the practical issues

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Financial rules : per diem (1)• 1. = lump sum, covering all sorts of travel costs including

accommodations, meals, local transport (also taxi !), visa, telephone, insurance, tips, ..

2. IF distance is more than 200 km single (hence exceptions possible with prior Commission approval)

3. Calculated per night spent and without fractions per day

4. no per diem for a one day’s journey

5. if APEX fare (stay between Saturday and Sunday obligatory) --> additional per diem

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Financial rules : per diem (2)• 6. Payment of hotel room + (maximum) per diem of 40 € in case

of group bookings with special hotel price if less than full per diem (specific Commission decision beforehand)

7. 75 €/night spent at place of duty for traineeships (insurance separately)

8. In budget table to the grant : to simplify presentation, proportional average figure (between the most and the less expensive destinations applied to all trips during one year) has been applied to all operations of one year > However : correct amount per country to take (see the list with the maximum amounts and the list with the current real amounts) (see handouts 9 and 10)

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Amounts of per diem applicable• 1. Daily allowances (per diem) = 196.500 €/year

a) rate : * 175 € for travel of experts (average figure > real amount to calculate and account for) > use of the list + examples* 75 € for traineeships (no exceptions)b) number of units : 720 units for travel of experts and 940 units for traineeships (indicative figures > can be mixed to use the full amount)c) accountancy :calculate and indicate the correct amount and deduct from the overall sum available> exercises

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Practical exercices on per diem• 1. What amount per diem would you apply for

the following WG participation :

- the meeting takes place in Luxembourg - the meeting dates are 17 and 18 September 2002- the meeting starts at 9.00 and ends at 18.00 o’clock

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the following study visit to OECD using APEX:

- the meeting takes place in Paris - the visit dates are 18 to 20 September 2002- the visit starts at 9.00 and ends at 18.00 o’clock

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the following seminar :

- the seminar takes place in Copenhagen - the seminar dates are 25 to 27 September 2002- the seminar starts at 9.00 and ends at 18.00 o’clock

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the following seminar in Sofia with group booking for the hotel ?4.1.- the seminar takes place in Sofia - the seminar dates are 23 to 25 September 2002- the seminar starts at 9.00 and ends at 18.00 o’clock- the room price negotiated with the hotel is 100 €/night

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the following seminar in Sofia with group booking for the hotel ?- the seminar takes place in Sofia - the seminar dates are 23 to 25 September 2002- the seminar starts at 9.00 and ends at 18.00 o’clock- the room price negotiated with the hotel is 100 €/night4.2. - what would be the number of per diems for a participant who takes an APEX ticket 4.3. - what would be the per diem rate when the negotiated hotel price would be 140 €/night ?

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a trainee of your administration in the following conditions ?

5.1. - the trainee stays in Luxembourg - the trainee period is from 1 September until 15 February 2003 5.2. - what if the trainee would stay in France ?

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Practical exercices on per diem• 6. What amount per diem would you apply for an

in-country course in the following conditions : 6.1. - the course takes place in your capital - the course dates are 25 to 27 September 2002- the course starts at 9.00 and ends at 18.00 o’clock---------------------------- 6.2. - After you did your calculation, are there any exceptions possible to the amount you come up with ?

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66

Financial rules on travel costs• - “most direct route”

a) by air : - min 400 km single or sea in between- only economy class (APEX = extra daily allowance) - exceptional : business class (strict control to avoid abuse) only if cheapest or most reasonable solutionEvidence : flight tickets and boarding passes

• b) by train, bus or ship :- first class return ticket incl. seat reservations and fast trains supplement ; also sleeping accommodations are OK (with less per diem) Evidence : used train, bus or ship tickets + hotel invoice

• c) by car : one first class return train or bus ticket even if 2 or more persons travel together without responsibility for damage or accident Evidence : official declaration + hotel invoice

67

Travel costs amounts applicable• 2. Travel costs abroad : = 95.500 €/year

a) rate : * 500 € per return trip (= average figure > real amount to calculate and account for) > examplesb) number of units : 191 (indicative figure including 10 units for traineeships > number of trips can be higher to use the budget if unit rate < 500 €)c) accountancy :- calculate and indicate the correct amount and deduct from the overall sum available ; - exception : on return trip to account for trainees (“full economy open return” ticket) > exercises

68

Practical exercices on travel costs + per diem

• 1. What total amount of costs would you account for in the following case :- a 10 days TES course in Riga with selected participants of the Baltic countries (from 9 until 20 September 2002)- the 4 Estonian participants have made the travel together by car - the 3 Lithuanian participants come by plane, one of them uses APEX- the 7 Latvian participants come by train and bus from all over the country- the normal ticket prices are : train/bus from Estonia and from Lithuania : 50 €, plane : economy 200 € and APEX 100 €- the fees are 100 € per participant - travel for the foreign participants took place on 8 and (return) 21 September (13 nights)

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• 2. What total amount of costs would you account for in the following case :- a 3 days WG in Berlin for 4 Polish members of staff of the NSO (from 18 to 20 September 2002) - travel takes place on 17 and 21 September - 2 participants come by car, two by plane (one with an economy ticket and the other one has a Business ticket)- the normal ticket prices are : train/bus from Poland : 40 €, plane : economy 200 € and Business 400 € - there is no specific motivation to divert from the usual maximum participants and no such authorisation is given

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• 3. What total amount of costs would you account for in the following case :3.1. a traineeship of one member of staff of Romania to INE Spain ?- the trainee period is from 1 September until 15 February 2003 - the normal ticket price Bucharest-Madrid is economy 500 € (single)- how and when are these payments done ?- what are the dates of the tickets ?- who takes care of the formalities (immigration, social security, address, ..) ?

• 3.2. what amount would be applicable if the trainee would stay in Luxembourg (the normal ticket price Bucharest-Luxembourg is economy 400 € single)

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Financial rules on other costs• 3. Studies/research (training fees) = 32.400 €/year

a) rate : * 1350 € per case (= average figure > real amount to calculate and account for) > examplesb) number of units : 24 (indicative figure > number of study trips can be higher to use the budget if < 1.350 €)c) accountancy :- calculate and indicate the correct amount and deduct from the overall sum available.

• 4. Audit costs = 3.500 €- maximum figure for one audit

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Financial rules on costs• 5. In-country training courses = 15.000 €

- maximum figure for one seminar/year6. Contingency reserve = 17.100 €amount to be used for :- costs for organising and hosting a conference, seminar, training, .. within the beneficiary country- either a “package” paid to the contractor concerned (includes everything also the “national” part) or NSO organises, travel via all other participants and representative part back of organisation costs via participating countries

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Financial rules on costs

• General observation : a possible surplus, on whatever cost item, can be used in other actions (with prior agreement of Commission)

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Exercice on in-country training• What total amount of costs would you account for in the

following case :- a 3 days in-country training course requested by Slovak Rep. on agricultural-environmental statistics in Bratislava with selected participants of the SK, CZ and HU (from 11 until 13 September 2002); travel on 10 and 14 September - the 4 Czech participants have made the travel together by car - 2 of the 4 Hungarian participants come by train, the two others by plane, one of them uses APEX- the 20 Slovak participants come by train and bus from all over the country- the normal ticket prices are : train/bus from Czech Rep.and from Hungary : 50 €, plane : economy 200 € and APEX 100- splitting of the organisation costs of 2.000 € has been approved by the Commission on a basis of 1/7 CZ, 1/7 HU and 5/7 SK- there is no specific motivation to divert from the usual maximum participants and no such authorisation is given

76

Exercice on study visits• What total amount of costs would you account

for in the following case :1) - a 15 days study visit of 3 Slovenian members of staff from Ljubljana to Venice (Italy) from 9 until 27 September 2002 ?- travel takes place from 8 until 28 September -the plane ticket price to is 400 €- ISTAT sends an invoice for honoraria of 500 € to NSO Slovenia- no specific request has been made, neither for travel nor on the duration of the visit2) -> what would be your amount if the visit would take place in the ISTAT main building in Rome ?-> the plane ticket price to Rome is also 400 €3) - what would be your amount if one participant would be using APEX (ticket price 300 €) ?

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Financial rules : original evidence to present for accounting purposes

• WG, seminars, study visits (travel and per diem)a) by air : flight tickets and boarding passes b) by train, bus or ship : used train, bus or ship tickets + hotel invoicec) by car : official declaration + hotel invoice

• secondment of trainees : idem as above + presence sheet, interim and final reports

• training courses : idem + invoice and payment receipt of fees

• in-country training courses : original invoice, attendance list, course programme and evaluation of the course provider

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Financial rules : original evidence to archive for audit purposes

• In all cases : mission reports

• WG, seminars, study visits : Travel and per diema) by air : “evidence” + invoice and payment receipt b) by train, bus or ship : “evidence” + invoice and payment receipt c) by car : official declaration + hotel invoice

• secondment of trainees : “evidence” + receipt of advance and proof of bank transfer

• training courses : idem + invoice and payment receipt of fees

• in-country training courses : “evidence” + request for authorisation (with ToR and budget estimation) and authorisation for the course

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Programme

• Background


• Grants details



81

Grants details• Practical Guide to PHARE Grants



• Commission Vade-mecum on Grants management (Part III of the presentation) for Eurostat action grants - > this part of the presentation

82

The Commission Vade-mecum on grants (handout 11)

• “Minimal rules” approach, DGs are free to be more strict but not more flexible

• Guidance between standardization and flexibility• Minimum binding rules:

programming and public announcement of grants collective evaluation prevention of multiple financing ex-post publicity

83

Award Principlesgrants are covered by a written agreementtransparency, equal treatment, not cumulative, not

retrospective, co-financingmay not produce profitpublication of annual programmeawarded by calls for proposals (except where urgency,

nature of action or status of beneficiary makes this inappropriate)

ex post annual publicationnon-cumulative - one grant only per operation and

beneficiarynon-retroactive - operation already started: acceptable

only IF applicant can demonstrate need to start before agreement

84

Award procedurecalls for proposal contain selection and award

criteriaeligible requests: made in writing by non-profit

making legal persons (natural persons and commercial companies possible in exceptional circumstances)

applications assessed by a committee set up for the purpose

applicant informed in writing of decision on application

reasons for refusal

85

Payment and implementation

payment in Eurospayments determined by financial risks

involved, duration and progress of operation and/or real costs incurred by beneficiary

amount of grant is definitive only on completion of operation

payment pro rata by beneficiary if action is not carried out or only partly carried out or not completed on schedule, or carried out at a cost below payments already made

86

The implementation chronologically

1. Ex-ante publicity 2. Calls for proposals 3. Collective evaluation 4. Budgetary commitment 5. Grant Agreement 6. Payment rules

87

Ex ante publicity

• For transparency reasons• In Official Journal : announcement

to the public of actions, amount involved, description and contact point (see OJ C 43 of 16.2.2002) (handout 12)

• Electronic folder with guidelines and detailed explanation (see Eurostat Home page on Internet - handout 13)

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Chronologically


89

The application

• model ca ll for proposals “package” with application form (handout 14)

• sent shortly after publication is made

• request = initiative of future beneficiary

• always indicate precisely the various types of costs to be covered

• add the latest annual budget of your organisation once per year

90

Chronologically1. Ex-ante publicity 2. Calls for proposals 3. Collective evaluation 4. Budgetary commitment 5. Grant Agreement 6. Payment rules

91

Selecting a proposal to award a grant

• Competition to have the best quality-price offer(s) selected (spending of public money)

• collectively : advisory and independent committee to recommend proposals (minutes)

• eligibility, selection and award criteria to ensure objectivity

• Project manager can/should go back to applicant to amend, clarify, negotiate

• decision = authorising officer

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Budgetary commitment

• = Reserving the money internally before a legal commitment (the agreement) can be made)

• Signature in the internal accounting system by the authorising officer after assessment by a project manager (for the technical part) and a member of the finance unit (for the financial part)

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The grant agreement

• = the legal commitment

• Standard model different from the PHARE model (handout 15) with examination of main articles > mcq and exercise on exchange rate

• technical annex (1) : task description, timetable and expected results

• legal annex (II) : standard legal conditions > exercise on costs and accounts

• budget annex (III) : with details on costs > exercice on budget tables

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The grant agreement

Most important articles : 2.1 : eligibility period <---> 2.2 :

duration of agreement(also presentation of retroactivity period and possibilities of extension of the agreement period)

3 : Financing elements

4 : Payment arrangements

5 : Required reports

5.2 : timeframe for « tacit » agreement

7 : annexes

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The general conditions

Most important articles : (handout 16)

4 : termination of the agreement (by either party)

6 : publicity requirements for both parties

7 : ownership/use

9 : amendment of the agreement

11 : eligible and non-eligible costs (exercises)

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Chronologically


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Payments

• Advance, intermediary payments and final payments (usually 40/20/40)

• only after coherence check between amount requested and work performed and confirmation by project manager or tacit approval

• invoice for the real costs (able to prove via the internal accountancy system) eg. staff costs, equipment, ..

100

Exercises : 1. Costs• Which of the following cannot be considered eligible for an action

grant? cost of bank transactionscost of translation provision for reserveexchange lossescost of financial guaranteecosts of land and buildings (immovable property)cost of electricity for the part of building used to implement the projectcost of new computers to be used only by the project staff insurance costmaintenance cost interest owedrentenergy invoice

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Exercises : 2. Budget tables

• Compare the four following budget tables

• 1. What observations/problems can you identify with them ?

• 2. What lessons can be learned based on this exercise ?

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Summary forward budget for the operation – Table N° 1 The applicant certifies that the costs indicated below are necessary to implement the operation for which a grant is requested.

Part A Expenditure/eligible costs

a’) costs of staff assigned to the operation

Mr Schmidt and his team of 5 staff

b’) travel and subsistence exoenses for staff involved in theoperation15 missions

c’) costs of equipment, land and immovable property (rent,purchase)

3 computers and printers for the team

d’) cost of consumables and supplies

e’) any other direct costs (please specify)translationsf’) general costs charged to the operation

(in Euros)

200.000

50.000

50.000

50.000

50.000

Part B – Financing plan

a) direct revenue expected from the operation

b) contribution by the applicant

c) contributions by other organisations (please specify)

d) contribution requested from the Commission

e) estimated bank interest generated by the grant over theperiod of implementation of the operation

f) where applicable, other contributions by the Commissionfor the same operation (please specify)

(in Euros)

200.000

200.000

TOTAL ELIGIBLE COSTS 400.000 TOTAL 400.000

Estimate of contributions in kind for the operation, whereapplicable

Estimate of contributions in kind, where applicable

TOTAL 400.000 TOTAL 400.000

103



a’) costs of staff assigned to the operation1 expert (1 months x 11.700 euros)1 assistant (10 months x 8.270 euros)1 secretary (10 months x 5.560 euros)b’) travel and subsistance expenses for staff involved in theoperationmission costs for participation to 5 coordination meetingsrequested by the project manager


rent and insurance of the premises

d’) costs of consumables and suppliese’) any other direct costs (please specify) 1

audit costs

f’) general costs charged to the operationHeating and electricity

(in Euros)

150.000

50.000

40.000

30.000

20.000

part B financing plan




Ministry of Transports


e) estimated bank interest generated by the grant requestedover the period of implementation of the operation


(in Euros)

40.000

250.000

TOTAL DES COÛTS ELIGIBLES 290.000 TOTAL 290.000

Estimation, le cas échéant, des contributions en nature Estimate of contributions in kind, where applicable

TOTAL 290.000 TOTAL 290.000

1 Sont inclus par exemple dans cette rubrique, les coûts liés aux frais bancaires, aux honoraires

104



a’) costs of staff assigned to the operationproject management (3 months x 10.000 Euros)

b’) travel and subsistence exoenses for staff involved in theoperation


d’) cost of consumables and supplies

e’) any other direct costs (please specify)sub-contractor

f’) general costs charged to the operation

(in Euros)

30.000

200.000

Part B – Financing plan



c) contributions by other organisations (please specify)Ministry of Transports


e) estimated bank interest generated by the grant over theperiod of implementation of the operation


(in Euros)

30.000

200.000




TOTAL 230.000 TOTAL 230.000

105

Summary forward budget for the action – Table N° 4 The applicant certifies that the costs indicated below are necessary to implement the operation for which a grant is requested


a’) costs of staff assigned to the operation1 expert (1 month x 11.700 euros)1 assistant (10 months x 8.270 euros)1 secretary (10 months x 5.560 euros)b’) travel and subsistance expenses for staff involved in theoperationc’) cost of equipment, land and immovable property (rent,purchase)

d’) cost of consumables and suppliese’) any other direct costs (please specify)costs of subcontracting

f’) general costs charged to the operation

(i Euros)

150.000

100.000

part B Financing plan





e) estimated bank interest generated by the grant requestedover the period of implementation of the operation

f) where applicabple, other contributions by theCommission for the same operation (please specify)

(i Euros)

150.000

100.000




TOTAL 250.000 TOTAL 250.000

106

Exercises : 3. MCQ on accounts• 1. The « pro-rata » rule of subsidy payments

stipulates that a :grant is to be paid in proportion of months to the duration of projectgrant is to be paid in proportion of months to the duration of eligible

periodgrant is to be paid in proportion to eligible costsgrant is to be paid in proportion to costs of staff directly linked to the

project

• 2. The grant amount is :a maximum amount which can ’t be exceededan amount expressed as a percentage of total eligible costsan amount representing a category of costs the grant will covera fixed amount to be applied to total eligible cost

107

Exercises : 4. Accounts• 3. As a project manager, you have the following two

projects to manage.

In the first there is less expenditure, in the second there is a surplus of revenue.

• What will be the final amount of the grant you are entitled to in both cases ?

108

Exercises : 4. Accounts• 4.1. A beneficiary introduces an application to receive a

grant of 20.000 Euros for an action costing 40.000 Euros (estimated). So, the Commission participation is fixed contractually at an amount equivalent to 50 % of the total of the eligible costs.The real cost is less than foreseen (30.000 Euros).

What is the final amount of the grant ?

109

Exercises : 4. Accounts• 4.2. A grant of 40.000 Euros has been awarded to an action of

which the total cost is 100.000 Euros. This action had a revenue estimated at 20.000 Euros. Thus, the Community grant was an amount equivalent to 50 % of the eligible net costs (100.000 - 20.000 or, in other words, 40 % of the total cost). The beneficiary covers 20 % of the action costs (16.000 Euros). An other fund source covers the remaining 30 % (24.000 Euros).However, the real revenu has been 30.000 Euros, so 10.000 Euros more than estimated.

What is the final amount of the grant ?

110

Exercises : 5. MCQ on the exchange rate• The sums due are expressed in €. The payments will be executed in

€. What is the exchange rate at the moment of final accounts as these are expressed in national currencies? Is it the official exchange rate published in the OJon the date of signature of the contract on the first day of the project on the last day of the project on the first working day of the month during which the payment

order will be validated on the first working day of the month following the end of the

projecton the last day of the eligible period on the last day of the contract?

grants and grant agreements luc t’joen eurostat, a-5

Documents

europethe road

meurthe road

partthe road

negotiationsthe road

national phare programmes

europecopenhagen summit

financial provisions

national programmes