Although the Structural Funds are part of the Community budget, the way they are spent is based on a system of shared responsibility between the European Commission and Member State authorities:
- the Commission negotiates and approves the development programmes proposed by the Member States, and allocates resources.
- the Member States and their regions manage the programmes, implement them by selecting projects, control and assess them.
- the Commission is involved in programme monitoring, commits and pays out approved expenditure and verifies the control systems.
For each operational programme, the Member State appoints:
- a managing authority (a national, regional or local public authority or public/private body to manage the operational programme);
- a certification body (a national, regional or local public authority or body to certify the statement of expenditure and the payment applications before their transmission to the Commission);
- an auditing body (a national, regional or local public authority or body for each operational programme to oversee the efficient running of the management and monitoring system).
New rules to simplify the financial management of the funds
One programme = one fund
From this, the ERDF and the ESF can each finance in a complementary and limited fashion actions falling within the scope of the assistance of another fund (this is limited to no more than 10% of the resources allocated by the Community to each priority area of an operational programme)
The exception to this rule is that the ERDF and the Cohesion Fund intervene jointly for programmes covering infrastructure and environment.
Budgetary commitments relating to the operational programmes are made per annual proportion, for each fund and each objective. The Commission commits the first annual proportion before the adoption of the operational programme. Afterwards, it commits the proportions by 30 April of each year, at the latest.
A portion of the budgetary commitment is automatically decommitted by the Commission if it has not been used or if no payment application has been received by the end of the second year following that of the budgetary commitment (n+2)
For Bulgaria, the Czech Republic, Estonia, Greece, Cyprus, Latvia, Lithuania, Hungary, Malta, Poland, Portugal, Romania, Slovenia and Slovakia, the deadline is set for the end of the third year (n+3) between 2007 and 2010, under their operational programmes.
Conditions for financing:
From now onwards the funds must target the priorities of the European Union regarding the promotion of competitiveness and job creation (Lisbon strategy). The Commission and the Member States oversee that 60% of the expenditure of all Member States for Convergence and 75% of the expenditure for Competitiveness and Employment target these priorities. Click here (PDF, 79KB) to view the categories of expenditure.
There are ceilings for the co-financing rates:
Maximum rate of co-financing for each objective:
- Convergence: between 75% and 85%
- Competitiveness and Employment: between 50% and 85%
- European Territorial Cooperation: between 75% and 85%
- Cohesion Fund: 85%
Eligibility of expenditure:
For expenditure to become eligible, it must be incurred between 1 January 2007 and 31 December 2015. Co-financed transactions must not be completed before the start date for eligibility. Rules are established at national level except where the specific rules of the fund state otherwise. This is different from the 2000-2006 period where the rules were set at Community level.
"Rules and conditions applicable to actions co-financed from Structural Funds
and Cohesion Fund- An overview of the eligibility rules
in the programming period 2007-2013" - February 2009
Education and training events
DIFFERENCES FROM 2000-2006
- All rules governing financial management are also valid for the Cohesion Fund.
- Regarding the eligibility of expenditure, the rules are established at national rather than European level.
- The co-financing rates have changed. In the previous period, pre-financing represented 7% of the participation of the funds to the action concerned (for the first 15 Member States) and 16% for the 10 Member States which joined in 2004.
- The first intermediary payment can only be made if the Member State gives the Commission a description detailing its management, certification and auditing bodies.
- The application for the first intermediary payment must be made within 24 months following the transfer by the Commission of the first proportion of the pre-financing allocation (otherwise the Member State must reimburse the pre-financing allocation).
- Reimbursements are calculated depending on the level of each priority area (and not on the level of the measures as in 2000-2006).
- The n+3 rule is introduced for the 12 most recent Member States, as well as for Greece and Portugal until 2010.
- Financial management becomes more flexible: a partial closure of transactions already completed is possible (before the programme as a whole is completed).
See funds management for 2000-2006