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Simplification

On March 3rd 2014, the Commission adopted its Final Simplification Scoreboard: over 120 measures to simplify the EU funding rules for Europe's businesses, towns, regions, scientists and NGOs.

Documents relating to the final simplification scoreboard

Video: less red tape for our regions, businesses and NGOs

Examples of improvements:

A single procedure

The purchase of machinery in vocational schools can be financed from the European Regional Development Fund and curriculum development from the European Social Fund. However, if both types of investments are needed to introduce a new training programme in a vocational school it is possible to combine them in the same project as cross-financing between the two Funds is possible under certain conditions. This was not possible under the old rules. Now such school only needs to do all the paperwork for one project instead of two. It will save the school time and effort, and allow it to devote more time to delivering the new training to pupils.

Cutting red tape

Under the rules valid for the period 2007-2013 all documents relating to cohesion policy projects receiving EU funding had to be kept for up to 10 years – and up to 15 years for some projects. The new rules reduce this period to up to 3 - 4 years after the project is completed. This simplification is especially important for smaller organisations like NGOs and small businesses.

Reducing the administrative burden

Under the previous programming period there were no limits to how many times a project could be audited. This possibility could represent a disproportionate administrative burden for beneficiaries. Under the new rules a better coordination between the Commission and national audit authorities is foreseen. Projects under a certain threshold will be audited only once and bigger projects no more than one time per accounting year.

Focus on results

Under the new rules, it will be achievements that count. Under the new arrangements (Joint Action Plan), a region could finance a project worth of EUR 10 million to bring 20% of inactive people back to work through training and mentoring. Achievement of the project's milestones would be enough to get the EU funding.

A single legal framework

Under the Connecting Europe Facility, there would be a common legal framework for EU energy, transport and IT networks. In practice, this will mean a common set of funding rules for all three sectors and a single committee to oversee implementation of the Facility. In short, less rules, more clarity and shorter time to allocate funds than before.

Fewer on-the-spot checks on farmers

Under the new rules, EU Member States with effective inspection systems and low error rates may reduce the number of on-the-spot checks on farmers provided the conditions set out in Commission´s implementing rules are met. In the past, a high number of checks could interrupt farmers in their daily activities and take up a lot of inspection resources. So, both farmers and inspectors will benefit from fewer checks.

Quality of project rather than country of origin decisive for eligibility for EU funding

In the past, national quotas might have blocked some excellent proposals in the environmental sector. For example, it was not possible to finance a project with 60 merit points from one Member States as the national allocation had already been used, while a project in another Member State with only 43 merit points could have been funded as the competition for projects there was lower. Such 60 merit points project would now be eligible for funding, as there will be no limits for the number of projects from the same Member State under the new LIFE programme. The Commission has already demonstrated that national quotas have not led to a more balanced distribution of projects. The limits on projects according to country of origin have actually reduced the EU added value of the programme.

Easier access to EU research funding

Under the old rules, researchers had to do a lot of administrative work in calculating the costs to be refunded by the EU. Under the new Horizon 2020 programme, the principle "one project – one funding rate" as well as a flat rate for indirect costs is introduced. In short, all beneficiaries under the same project will be refunded on the basis of a single rate, with the exception of non-profit legal entities in innovation actions; indirect costs will be refunded on the basis of a flat rate. Both measures aim to reduce the risk of errors by beneficiaries as well as litigations, bureaucracy and to free human resources that may more efficiently be employed for the action.

E-cohesion funding now possible

The new e-cohesion policy allowing for an electronic exchange of data between beneficiaries and the managing authorities will be introduced as of 2016 in all Member States. This measure will enable beneficiaries to submit data only once and keep all documents in electronic form; it will reduce the administrative burden for beneficiaries. E-cohesion should reduce the workload at EU level by approximately 11% as paperwork exchanges will no longer be necessary.

European Social Fund: focus on projects that make difference

Without minimum allocation of money for the European Social Fund there was always a risk of diluting the focus on projects aimed directly at supporting employment. The new rules set a minimum allocation to the European Social Fund in order to have a predictable budget for this essential priority.

Use of innovative financial instruments to attract more capital on infrastructure projects

Innovative financial instruments under the new Connecting Europe Facility (CEF) will generate resources in addition to those from the EU budget. For example, project bonds will introduce this mechanism. The CEF rules are sufficiently flexible to attract private capital for European projects in rapidly changing market conditions. The completion of the project bond pilot phase in 2015 is important for a wider use of the financial instruments in infrastructure projects throughout the whole EU.

Simplified cost-funding model: Horizon 2020 (research)

This simplified cost reimbursement options will reduce the administrative burden for all beneficiaries of the ERDF, ESF, Cohesion Fund and the EMFF. Thanks to further simplified cost reimbursement options, a foundation will no longer have to perform a series of complicated calculations for the reimbursement of its costs. For instance, a cancer research foundation receives funds from the EU research and innovation programme Horizon 2020. A simplified method will reduce the risk of errors and will make access to EU funds easier. Therefore the accounting department will no longer have to perform a series of complicated calculations for his reimbursement.

National allocations phased-out: LIFE Programme (environment)

The European Commission has received several excellent project proposals regarding climate mitigation from companies, NGO's, and public entities from a small Member State, along with mediocre project proposals from bigger Member States, which, under the LIFE rules, would have a high indicative national allocation. While, in the past, the national allocation might have blocked out some of these excellent proposals, they would now be retained for funding, as long as they are the best overall and as long as the corresponding budget is sufficient.

Use of modern technologies (cohesion)

The construction of a bridge in Slovakia required the local administration to submit 20 copies of a 350-pages dossier. Thanks to the new "e-cohesion", beneficiaries can now submit data and store documents in electronic form for less paper-work and exchanges and a lower risk of loss of documents.

Reduced delay for document keeping (cohesion)

A shorter deadline for document retention (2 or 3 years from 31 December following the submission of the accounts in which the expenditure of the operation is included) means lower administrative burden for beneficiaries of the ERDF, ESF, Cohesion Fund and the EMFF.

Reduced delay for payments to beneficiaries (cohesion)

A Spanish company is in charge of a project co-funded by the EU. Provided that all supporting documents are in order, the company should receive the money it is due maximum 90 days after it made its payment claim.

Financial instruments: financing for Small and Medium Enterprises

Mr Dupont manages a small printing shop with 100 employees. He would like to invest within his enterprise but he doesn't have any money. He can contact one of the intermediaries working with the EU programmes (mainly banks, guarantee schemes and venture capital funds), submit his request for financing (for instance a loan application to a bank) and, if provided with a positive reply, enjoy the financing needed for his activity.
The full list of intermediaries working with EU programmes is available at: http://www.access2finance.eu

Small farmers scheme (agriculture)

A small farm wishes to receive support from the EU, but is afraid of the formalities and the obligations imposed in comparison to the small amount of support the farm is probably entitled to receive. However, thanks to the new scheme for small farmers and its simplified procedure for aid application, administrative constraints and risk of error will be reduced. In addition, the small farmer will be exempted from stringent obligations (cross-compliance, greening) and the corresponding controls. However, the scheme is optional and not mandatory as proposed by the Commission.


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