Eu cohesion policy 2014 2020 proposals from the european commission reykjavik 1 6 1 7 january 201 2
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EU Cohesion Policy 2014-2020 Proposals from the European Commission Reykjavik 1 6 -1 7 January 201 2. Legislative package. The General Regulation Common provisions for cohesion policy, the rural development policy and the maritime and fisheries policy

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Eu cohesion policy 2014 2020 proposals from the european commission reykjavik 1 6 1 7 january 201 2

EU Cohesion Policy 2014-2020Proposals from theEuropean CommissionReykjavik16-17January2012


Legislative package

Legislative package

  • The General Regulation

    • Common provisions for cohesion policy, the rural development policy and the maritime and fisheries policy

    • Common provisions for cohesion policy only (ERDF, CF, ESF)

  • Fund specific regulations

    • ERDF regulation

    • CF regulation

    • ESF regulation

    • ETC regulation

  • EGTC regulation


  • Building blocks

    Building Blocks

    Financial Framework and co-financing rates

    Strategic approach

    Conditionalities and performance

    Programming

    Territorial development

    Financial instruments

    Monitoring, evaluation and indicators, information and communication

    Conditions of assistance, including simplified costs

    Management and control and financial management

    Scope, thematic concentration in ERDF and CF regulations

    Scope, thematic concentration in ESF regulation

    European territorial cooperation

    Comitology, etc.


    Block 1

    Block 1

    Objectives, Financial Framework

    and co-financing rates

    (mainly cohesion policy specific provisions)

    Articles 81-86 of CPR

    Article 53 of CPR

    Article 22 of CPR

    Articles 110-111 of CPR


    Mission and goals

    Mission and Goals

    • Mission of EU cohesion policy:

      • to reduce disparities between Europe's regions strengthening economic, social and terrritorial cohesion in line with article 174 of the Treaty

      • to contribute to the Union Strategy of smart, sustainable and inclusive growth

    • Two goals:

      • Investment for growth and jobs

      • European Territorial cooperation


    Budget for cohesion policy post 2013

    Budget for Cohesion Policy post 2013


    Geographical coverage of support

    Geographical coverage of support

    • Three categories of regions

      • Less developed regions (GDP per capita < 75% of EU average)

      • Transition regions (GDP per capita between 75% and 90%)

      • More developed regions (GDP per capita > 90%)

    • The new category of transition regions replaces the current statistical phasing-out and phasing-in regions

    • Why a new category for transition regions?

      • Fairer system for regions with similar level of economic development

      • Helps to soften the transition between less and more developed regions

    • Safety net for regions whose GDP per capita is below 75% of the EU average in 2007-2013


    Legislative package

    • Cohesion Fund for Member States with GNI per capita <90%

    • Investments in the fields of environment and trans-European transport Networks

    • On the basis of latest GNI figures, Greece and Cyprus will benefit from phasing-out of Cohesion Fund


    Financial support from the funds

    Financial support from the Funds

    Maximum co-financing rates at the level of the priority axis:

    85 % for the Cohesion Fund

    85 % for the less developed regions of Member States whose averageGDP per capita for the period 2007 to 2009 was below 85 % of the EU-27average during the same period and for the outermost regions

    80% for the less developed regions in Member States eligible for the transitional regime of the CohesionFund on 1 January 2014

    75% for the less developed regions in Member States other than those mentioned above

    75% for all regions whose GDP per capitafor the 2007-2013 period was less than 75% of the average of the EU-25for the reference period but whose GDP per capita is above 75% of theGDP average of the EU-27

    60 % for other transition regions

    50 % for the more developed regions (apart from those whose GDP per capita was less that 75% of EU average in 2007-2013)

    75% for European Territorial Cooperation


    Technical assistance

    Technical assistance

    No changes in coverage or scope – only clarification

    TA at the initiative of the Commission – 0,35%

    TA at the initiative of the MS

    Up to 4% for mainstream programmes

    Up to 6% for ETC, but no less than EUR 1 500 000

    One Fund can finance technical assistance for other Funds (multi-fund programmes, separate OP for technical assistance), however only up to 10% of any Fund can be allocated to TA


    Block 2

    Block 2

    Strategic Approach

    (common provisions for the CSF Funds)

    Articles 3-15 of CPR


    Common principles for all funds 1

    Common Principles for all Funds (1)

    • Strengthening partnership and multi-level governance

      • Introduction of a binding European Code of conduct

        • Sets out objectives and criteria to support the implementation of partnerships

        • Facilitates sharing of information and good practices among Member States

    • Compliance with Union and national law


    Common principles for all funds 2

    Common Principles for all Funds (2)

    • Reinforcement of gender equality and non-discrimination:

      • Horizontal principle of the regulations

      • Specific actions in OPs, covered by ex-ante evaluation

      • Opinion of the national equal opportunities’ body on the OPs

      • Project selection

      • Followed up in reporting

    • Promoting sustainable development

      • Horizontal principle of the regulations

      • Specific actions in OPs, covered by ex-ante evaluation

      • Project selection

      • Followed up in reporting

      • Tracking of expenditure for climate change objectives


    Thematic objectives to deliver europe 2020

    Thematic Objectives to Deliver Europe 2020

    • Strengthening research, technological development and innovation

    • Enhancing access to, and use and quality of, information and communication technologies

    • Enhancing the competitiveness of small and medium-sized enterprises, the agricultural sector (for the EAFRD) and the fisheries and aquaculture sector (for the EMFF)

    • Supporting the shift towards a low-carbon economy in all sectors

    • Promoting climate change adaptation, risk prevention and management

    • Protecting the environment and promoting resource efficiency

    • Promoting sustainable transport and removing bottlenecks in key network infrastructures

    • Promoting employment and supporting labour mobility

    • Promoting social inclusion and combating poverty

    • Investing in education, skills and lifelong learning

    • Enhancing institutional capacity and an efficient public administration


    Strengthening the strategic approach

    Common Strategic Framework

    Partnership contract

    Operational Programmes

    Strengthening the Strategic Approach


    Common strategic framework

    Common Strategic Framework

    • Sets a comprehensive investment strategy for all the funds, including rural development and maritime and fisheries policies

    • Translates the thematic objectives into key actions for Member States and regions

    • Establishes priority areas for cooperation activities

    • Ensures better coherence and consistency with the National Reform Programmes


    Partnership contract

    Partnership Contract

    • Prepared at national level with close involvement of partners

    • Agreed between the Commission and Member State, includes:

      • The contribution of the CSF Funds towards the achievement of thematic objectives

      • An integrated approach for territorial development supported by the CSF Funds

      • Arrangements for effective implementation: involvement of partners, ex-ante conditionalities, performance framework, additionality

      • Arrangements for efficient implementation: administrative capacity, administrative burden reduction


    Adoption and amendment of the partnership contract

    Adoption and amendment of the partnership contract

    The Commission shall assess the consistency of the Partnership Contract withtheCPR, with the Common Strategic Framework, and the country-specificrecommendations under Article 121(2) of the Treaty and the Councilrecommendations adopted under 148(4) of the Treaty, taking account of theex ante evaluations of the programmes

    The Commission shall adopt a decision approving the Partnership Contract within 6 months of its submission

    If the Common Strategic Framework is revised, the Member Statesshall propose amendments, where necessary, to their Partnership Contract andprogrammes to ensure their consistency with the revised Common Strategic Framework


    Block 3

    Block 3

    Conditionalities and performance

    (common provisions for the CSF Funds)

    Articles 17, 20-21 of CPR and Annex IV

    Articles 18, 19 of CPR and Annex I


    Ex ante conditionality

    Ex-ante conditionality

    • Conditions to be fulfilled prior to submission of Partnership Contracts and operational programmes

    • Directly related to the thematic objectives or horizontal conditions of effectiveness

    • Specified criteria for fulfilmentdefined in annex IV of CPR

    • Conditionalities must be fulfilled within two years of the approval of the Partnership Contract or by end of 2016

    • Non-fulfilment of conditionalities at the time of the adoption of the programmes or by the deadline outlined above constitutes a basis for suspension of payments


    Legislative package

    Regulation: Thematic and horizontal ex-ante conditionalities set out in the Regulation

    Preparation of programming documents: Member States undertake a self-assessment verifying whether the ex-ante conditionality criteria have been met.

    Conditionality respected: Draft programmes explain that no further action needs to be taken

    Partially respect:Draft programmes lay down commitments for fulfilment

    Not respected:

    Draft programmes lay down commitments for fulfilment, payments could be made only upon fulfilment

    Submission of programming documents: The results of the self-assessment and commitments are included in the draft programmes.

    Negotiation and agreement on commitments: The agreed commitments are set out in the programmes and synthesised in the Partnership Contract.


    Reinforced macroeconomic conditionality for the funds

    Reinforced macroeconomic conditionality for the Funds

    Closer link between cohesion policy and the economic governance of the Union in two areas:

    Council recommendations

    The broad economic guidelines, the employment guidelines as well as the Eurozone-specific measures

    The excessive deficit procedure

    The macroeconomic imbalances procedure

    Union financial assistance to a Member State

    under the European financial stabilisation mechanism

    under the facility providing medium-term financial assistance for Member States' balances of payments

    in the form of an ESM loan


    Amendment of programmes and partnership contracts

    Amendment of programmes and partnership contracts

    Commission may request or propose amendments to the Partnership Contract and relevant programmes where it is necessary to:

    support the implementation of Council recommendations

    maximise the impact of the funds where the Member State receives financial assistance from the EU

    Commission can suspend payments where Member State fails to react to Commission requests or observations within the established deadlines


    Specific provisions linked to adjustment programmes

    Specific provisions linked to adjustment programmes

    Where a Member State receives Union financial assistance linked to an adjustment programme, the Commission may amend the Partnership Contract and the OPs without a proposal by the Member State

    In this case the Commission will become directly involved in the management of the programmes


    Automatic suspension of payments

    Automatic suspension of payments

    The Commission shall suspend part or all of payments and commitments where:

    the Council decides or concludes that a Member State:

    does not comply with measures set out by the Council in relation to the economic policy guidelines for Eurozone members,

    has not taken effective action to correct its excessive deficit,

    has not taken the necessary measures to correct macro-economic imbalances;

    it concludes that the Member State has not taken measures to implement the adjustment programme and decides not to authorise the disbursement of the financial assistance granted to this Member State;

    the Board of Directors of the European stability mechanism concludes that the conditionality attached to an ESM financial assistance in the form of an ESM loan to the concerned Member State was not met and as a consequence decides not to disburse the stability support granted to it.


    Application and lifting of suspension

    Application and lifting of suspension

    When deciding to suspend part or all of the payments or commitments the Commission shall ensure that the suspension is:

    proportionate and effective,

    takes into account the economic and social circumstances of the Member State concerned,

    and respects the equality of treatment between Member States, in particular with regard to the impact of the suspension on the economy of the Member State concerned.

    All suspensions shall be lifted without delay when the underlying cause for suspension has been addressed


    Performance framework

    Performance framework

    • Focuses on the achievement of programme objectives

    • Sets out milestones and targets for performance of programme priorities for 2016, 2018 and 2022

    • Milestones established for 2016 shall include financial indicators and output indicators

    • Milestones established for 2018 shall include financial indicators, output indicators and where appropriate, result indicators

    • Milestones may also be established for key implementation steps


    Performance review

    Performance review

    The performance framework shall constitute the basis for the performance review in 2017 and 2019 and the disbursement of the performance reserve

    Information for the performance review is drawn from the progress reports

    Member States are expected to react to significant shortfalls in the achievement of milestones (measures to improve performance, reprogramming)

    In the absence of sufficient action, Commission can suspend payments

    Significant failure to achieve the targets set for 2022 in the performance framework can lead to a financial correction at the end of the programming period


    Performance reserve

    Performance reserve

    A performance reserve of 5% is set aside at the beginning of the programming period (exception for ETC)

    The performance reserve is established per CSF Fund, per Member State and per category of region

    The 5% reserve is allocated to each Member State following the performance review in 2019

    Allocation can only be used for priority axes where performance has been satisfactory (milestones have been achieved) – based on Member State proposal


    Additionality

    Additionality

    Only for MS in which less developed and transition regions cover at least 15 % of the total population

    between 15% and 70% = verification at national and regional level

    70%+ = verification at national level

    Reference level in the Partnership Contract – based on ex-ante verification by the Commission having regard to the average level of public or equivalent structural expenditure per year in the period 2007-2013

    Mid term verification in 2018 and ex-post verification in 2022

    Exceptional circumstances to be taken into account, revision of reference level possible after mid-term verification

    Shortfall of more than 3% from reference level at ex-post verification = financial corrections up to 5%

    Information drawn from Stability and Convergence programmes


    Block 4

    Block 4

    Programming

    (both common and specific provisions)

    Articles 23-27 of CPR

    Articles 87-98 of CPR

    Articles 51 and 52 of CPR

    Articles 108 and 109 of CPR

    Articles 6-12 of the ESF Regulation


    Programming

    Programming

    • Common provisions on preparation, adoption and amendment, as well as on the shared elements of the content

    • Specific provisions on the content of operational programmes under cohesion policy:

      • Strategy for smart, sustainable and inclusive growth

      • Description of priority axes

      • Contribution to territorial development

      • Arrangements to ensure effective implementation

      • Financing plan

      • Implementing provisions

      • Specific actions (related to horizontal principles)

    • Operational programmes submitted shall be accompanied by the ex-ante evaluation


    Adoption and amendment of operational programmes

    Adoption and amendment of operational programmes

    The Commission shall assess the consistency of programmes with this Regulation, the Fund-specific rules, their effective contribution to the thematic objectives and the Union priorities specific to each CSF Fund, the Common Strategic Framework, the Partnership Contract, the country-specific recommendations under Article 121(2) of the Treaty and the Council recommendations adopted under 148(4) of the Treaty, taking account of the ex ante evaluation.

    The Commission shall adopt a decision approving the operational programmes within 6 months of its submission

    Any amendment to an operational programme shall be duly substantiated and shall set out the expected impact of the amendment. Where necessary the Commission will amend the Partnership Contract at the same time with the amendment of the operational programme


    Reinforcing integrated programming

    Reinforcing Integrated Programming

    Integrated programme approach

    The Common Strategic Framework at EU level and the Partnership Contract at national level covering all the CSF Funds

    Possibility for Member States to prepare and implement multifund programmes combining ERDF, ESF and the Cohesion Fund

    Possibility for Member States to establish "multi-category" operational programmes which cover less developed, transition, and more developed regions or any combination of these.

    Integrated approaches for territorial development supported by the CSF Funds


    Major projects

    Major projects

    A coherent approach focusing on:

    realistic planning

    the preparation of the project pipeline

    monitoring and regular reporting

    2007-2013 threshold maintained

    Clear information requirements

    Major projects submitted must correspond to the list in the operational programme

    Limiting the scope of Commission appraisal

    Expenditure can be declared only upon approval of the major project by the Commission


    Joint actions plans

    Joint actions plans

    Optional approach – operation implemented and financed based on outputs and results agreed between the Member State and the Commission

    JAP adopted by the Commission, based on a proposal by the Member State

    Negotiation on:

    Outputs and resultsnecessary to reach an objective such as an education reform

    ‘Pricing’ of outputs and results based on lump sums and standard scales of unit costs

    Payments correspond to the achievement of ‘milestones’

    Control of outputs and results, not expenditure by the beneficiary

    National management practices at beneficiary level


    Block 5

    Block 5

    Territorial development

    (common and specific provisions)

    Articles 28-31 of CPR

    Articles 99 of CPR

    Articles 7-11 of the ERDF Regulation


    Reinforcing community led local development

    Reinforcing community-led local development

    • Integrated approach to community-led local development

      • Facilitates integrated investment by small communities including local authorities, NGOs, and economic and social partners

      • Integrated local development strategies

      • Local action groups to design and implement these strategies

      • Integrated approach and common rules = can be financed jointly from ERDF, ESF, EAFRD and EMFF


    Reinforcing territorial cohesion

    Reinforcing Territorial Cohesion

    • Focus on sustainable urban development

      • At least 5% of the ERDF resources to be allocated to integrated actions for sustainable urban development

    • Creation of an urban development platform

      • To promote capacity-building and networking between cities and exchange of experience on urban policy at EU level

      • Adoption of a list of cities to participate in the platform

    • Support for innovative actions in the field of sustainable urban development - Subject to a ceiling of 0,2% of the annual funding

    • Integrated territorial investments

      • Investments under one or more Operational Programmes can take the form of integrated territorial investments

    • Adressing the specific needs of geographical areas most affectedby poverty or target groups at highest risk of discrimination or exclusionwith special regard to marginalised communities

      • contribution highlighted in the content of each OP


    Block 6

    Block 6

    Financial instruments

    (common provisions for the CSF Funds)

    Articles 32-40 of CPR

    Article 15 of the ESF Regulation


    Financial instruments 1

    Financial Instruments (1)

    • Common rules for the cohesion policy, the rural development policy and the maritime and fisheries policy

    • Clarification of implementation rules

    • Reinforcement of legal certainty

    • Extension of the present scope of financial instruments

    • Simplification of access to instruments such as JEREMIE, JESSICA and JASMINE


    Financial instruments 2

    Financial Instruments (2)

    • Necessity for an ex ante assessment which has identified market failures or suboptimal investment situations, and investment needs

    • Combination with grants, interest rate subsidies and guarantee fee subsidies

    • Combination with other financial instruments

    • Eligibility of in-kind contributions in limited circumstances


    Financial instruments 3

    Financial Instruments (3)

    Options for set-up:

    1) EU level platforms

    2) Financial instruments established by the Member States complying with standard terms and conditions laid down by the Commission (standard models)

    3) Financial instruments of specific design established by Member States

    Support may be given by:

    • Investment in the capital of legal entities

    • Entrusting implementation tasks to the EIB, international financial institutions or a body selected in accordance with applicable Union and national rules

    • Direct implementation by the managing authority (for loans and guarantees only)


    Financial instruments 4

    Financial Instruments (4)

    • Special management and control provisions for instruments set up at EU level

    • Special provisions for financial management:

      • more flexible co-financing arrangements

      • clarification of eligible expenditure at closure

      • re-use of resources until closure

      • the use of legacy resources

      • specific reporting requirements (deadlines aligned with annual reports on implementation)


    Block 7

    Block 7

    Articles 41-50 of CPR

    Articles 100-104 of CPR

    Article 6 and Annex of ERDF Regulation

    Article 4 and Annex of CF Regulation

    Article 5 and Annex of the ESF regulation

    Article 15 and Annex ETC Regulation

    Articles 105-107 and Annex V of CPR

    Monitoring, evaluation and indicators

    Information and communication

    (both common and specific provisions)


    A focus on results indicators

    A Focus on Results: Indicators

    • Fund Specific Common Indicators

      • Common output and, where appropriate, result indicators

      • Fund specific rules on baselines, targets and reporting

    • Programme Specific Indicators

      • Output indicators, where appropriate

      • Result indicators related to the priority axis


    A focus on results monitoring reporting 1

    A Focus on Results: Monitoring & Reporting (1)

    • No annual report in 2015

    • Lighter annual reports on implementation:

      • Information of financial progress and indicators

      • Actions to fulfil ex-ante conditionalities

      • Issues which affect the performance of the programme

      • Information on the implementation of major projects and JAPs

    • Thorough information and analysis of all the elements of the OP required only in 2017, 2019 and for the final report


    A focus on results monitoring reporting 2

    AFocus on Results: Monitoring & Reporting (2)

    Financial data to be submitted electronically 4 times a year:

    the total and public eligible cost of the operations and the number of operations selected for support

    the total and public eligible cost of contracts or other legal commitments entered into by beneficiaries in implementation of operations selected for support

    the total eligible expenditure declared by beneficiaries to the managing authority

    A progress report (at national level) common for the CSF Funds to be submitted in 2017 and 2019 – content corresponds to that of the Partnership Contract


    A focus on results evaluation 1

    Ex-ante evaluation:

    Justification for selected thematic objectives contributing to EU2020 & consistency, relevance and realism of indicators, targets & financial allocations

    Monitoring and evaluation capacities and appropriate data collection arrangements

    Milestones for performance framework

    AFocus on Results: Evaluation (1)


    A focus on results evaluation 2

    A Focus on Results: Evaluation (2)

    • Evaluation during the programming period:

      • Evaluation plan obligatory – to be adopted by first Monitoring Committee

      • More evaluation of the effects of interventions (impact)

      • Implementation evaluations when necessary

      • Synthesis report of evaluations by MS in 2020

    • Ex-post evaluationby the Commission


    Information and communication

    Information and Communication

    • Rules on information and communication is part of main regulation

    • 7 year strategy with yearly updates (no Commission approval, Monitoring Committee adoption)

    • List of operations with comparable information

    • Single national website/portal for all programmes

    • Designation of national information officers

    • Networks to ensure exchange of experience and good practice


    Block 8

    Block 8

    Conditions of Assistance

    (common provisions for the CSF Funds)

    Articles 54-61 of CPR

    Articles 109-110 of CPR

    Articles 13 and 14 of the ESF Regulation


    Revenue generating operations

    Revenue generating operations

    Review of the rules on revenue generation

    • Member States can choose between:

      • The current approach based on the funding gap analysis;

      • A new approach based on application of a flat rate revenue percentages established at EU level for different types of operations

    • Where revenue cannot be determined in advance, the net revenue must be deducted retrospectively

    • Maintaining current exemptions (for all ESF operations, and operations under EUR 1 million, state aid and financial instruments) to ensure a proportionate approach


    Changes in eligibility rules 1

    Changes in eligibility rules (1)

    • An operation may receive support from one or more CSF Funds and from otherUnion instruments, provided that the expenditure item included in a payment application for reimbursement by one of the CSF Funds does not receive supportfrom another Fund

    • Net revenue directly generated by an operation during its implementation whichhas not been taken into account at the time of approval of the operation, shall bededucted from the eligible expenditure of the operation in the final paymentclaim submitted by the beneficiary. This rule shall not apply to financialinstruments and prizes

    • Operations shall not be selected for support by the CSF Funds where they havebeen physically completed or fully implemented before the application forfunding under the programme is submitted by the beneficiary to the managingauthority


    Changes in eligibility rules 2

    Changes in eligibility rules (2)

    • In the case of repayable assistance, the support repaid to the body that provided it, or toanother competent authority of the Member State, shall be kept in a separate account andreused for the same purpose or in accordance with the objectives of the programme

    • As a rule, VAT is not eligible. However, VAT amounts shall be eligible where they arenot recoverable under national VAT legislation and are paid by abeneficiary other than non-taxable person as defined in the firstsubparagraph of Article 13(1) of Directive 2006/112/EC, provided thatsuch VAT amounts are not incurred in relation to the provision ofinfrastructure


    Changes in eligibility rules 3

    Changes in eligibility rules (3)

    • Eligibility of operations depending on their location

      • Operations supported by the CSF Funds shall be located in the area covered by the programme under which they are supported

      • Exemptions subject to conditions:

        • benefit to the programme area

        • ceiling of 10% at the level of a priority axis

        • Monitoring Committee approval

        • fulfilment of management, control and audit obligations

      • Only promotional activities may be financed outside the Union

      • Provisions do not apply to ETC and ESF


    Reimbursement options

    Reimbursement options

    • Grants may take the following forms:

      • reimbursement of eligible costs actually incurred and paid, together with, where applicable, in-kind contributions and depreciation;

      • standard scales of unit costs;

      • lump sums not exceeding EUR 100 000 of public contribution;

      • flat-rate financing, determined by the application of a percentage to one or several defined categories of costs.

    • The Member State may choose which option to use - exception for ESF operations < 50.000 EUR: only simplified costs are allowed


    Simplified costs 1

    Simplified costs (1)

    Simplified costs can be established on the basis of:

    • a fair, equitable and verifiable calculation method based on:

      • statistical data or other objective information; or

      • the verified historical data of individual beneficiaries or the application of their usual cost accounting practices;

    • methods and corresponding scales of unit costs, lump sums and flat rates applicable in Union policies for a similar type of operation and beneficiary;

    • methods and corresponding scales of unit costs, lump sums and flat rates applied under schemes for grants funded entirely by the Member State for a similar type of operation and beneficiary;

    • rates established by the CPR or the Fund-specific rules (no methodology required);

    • on the basis of the project budget (for ESF operations below 100 000).


    Simplified costs 2

    Simplified costs (2)

    • Rates established at EU level shall include:

      • a flat rate for indirect costs (all CSF Funds) - up to 15% of eligible direct staff costs;

      • for ETC - staff costs up to 15% of the direct costs other than the staff costs of that operation;

      • for ESF:

        • scales of unit costs/lump sums established by the Commission,

        • 40% flat rate of direct staff costs to calculate the amount of all the other eligible costs.

    • The rates established at EU level will not need to be justified by analysis atnational or regional level.


    Durability

    Durability

    • Durability affected when an operation undergoes:

      • a cessation or relocation of a productive activity;

      • a change in ownership of an item of infrastructure which gives to a firm or a public body an undue advantage; or

      • a substantial change affecting its nature, objectives or implementation conditions which would result in undermining its original objectives.

    • Clarification of situations where exemptions apply – ESF, operations other than infrastructure and productive investment, financial instruments and non-fraudulent bankruptcy


    Block 9

    Block 9

    Management and control

    Financial Management

    (both common and specific provisions)

    Articles 62-79 of CPR

    Articles 112-140 of CPR


    Responsibilities of member states and of the commission

    Responsibilities of Member States and of the Commission

    • Broad continuity of general responsibilities and obligations

    • Links with the recast of the Financial Regulation: general aim to strengthen the assurance process

    • eCohesion Policy

      • the Member States shall ensure that by the end of 2014 all exchanges between the administration and beneficiaries can be carried out by way of electronic data exchange systems (without a duplicating paper trail)

      • a possibility, not an obligation, for the beneficiaries to use electronic systems


    Structure of the management and control system

    Structure of the management and control system

    • There is broad continuity in the structure of the management and control system and in the division of tasks and the responsibilities of the managing authority, the certifying authority and the audit authority

    • New elements:

      • Possibility to set up managing authorities which fulfil the functions of certifying authorities

      • Requirement for the structural independence of audit authorities for operational programmes with total support from the Funds of above EUR 250 million


    Accreditation

    Accreditation

    • Member State should designate an accrediting body at ministerial level: responsibility for accreditation, continuous oversight, for fixing a probation period, and withdrawal of accreditation

    • Both managing authorities and certifying authorities should be accredited

    • Decision of national accreditation is to be made on the basis of an audit. The oversight by the accrediting authority shall be based on audit work of the audit authority– no additional controls

    • Interim payments will commence once the Commission has been notified of the accreditation decision

    • Review by the Commission is risk based: no review for programmes under EUR 250 million, or for low risk programmes


    The functions of the managing authority

    The functions of the managing authority

    Definition of responsibilities relating to:

    • Programme management (supporting the Monitoring Committee, reporting, distribution of information, establishment of systems to record and store data, ensuring data collection and storage)

    • Selection of operations (drawing up and application of selection criteria, ensuring that selected operations are eligible, informing beneficiaries of the conditions of support, ensuring that beneficiaries have sufficient capacity to implement operations, enforcing the rules on relocation, assigning intervention categories to operations)

    • Financial management and control (verifications, ensuring separate accounting, putting in place anti fraud- measures, ensuring audit trail, drawing up the management declaration of assurance)


    The functions of the certifying authority

    The functions of the certifying authority

    Definition of responsibilities relating to:

    • drawing up, submission and certification ofpayment applications

    • drawing up and certification of the annual accounts

    • ensuring that there is a system which records and stores accounting records for each operation

    • ensuringthat it has received adequate information from the managing authority on theprocedures and verifications carried out in relation to expenditure

    • taking account results of all audits carried out

    • maintaining accounting records in a computerised form of expenditure declaredto the Commission and the corresponding public contribution paid tobeneficiaries

    • keeping an account of amounts recoverable and of amounts withdrawn


    The functions of the audit authority

    The functions of the audit authority

    • There are no major changes to the functions of the AA in comparison with 2007-2013, however there will be changes in the timing of audit work and in the coverage of the audit opinion :

      • AA shall submit on an annual basis an audit opinion “on the annual accounts for the preceding accounting year, whose scope shall cover the completeness, accuracy and veracity of the annual accounts, the functioning of the management and control system and the legality and regularity of the underlying transactions”


    Proportionate audit arrangements

    Proportionate audit arrangements

    • At the level of operations

      • Operations under EUR 100 000 – max. one audit prior to closure

      • Other operations – max. one audit per accounting year prior to closure

    • At the level of the operational programme

      • No significant deficiencies – COM may agree with AA to reduce the level of audit work and not to perform any direct on-the –spot checks

      • Where the COM can rely on the opinion of the AA, it may agree to limit its on-the-spot audits to the work of the AA

    • COM can carry out audits if it identifies specific risks or there is evidence of serious deficiencies

    • COM can carry out audits to assess the work of the AA

    • No restrictions for audit work after closure of operations (within the retention period)


    Legislative package

    Accounting year and clearance of accounts

    Compulsory interim

    payment application

    Accounting year

    Clearance of accounts

    1 Feb N+1

    Dec N

    30 Jun N

    1 Jul

    N -1

    Dec N-1

    30 Apr N+1

    30 Jun N+1

    Preparation of the annual accounts, management declaration, audit report, audit opinion


    Pre financing

    Pre-financing

    • Initial pre-financing 4% paid in 3 instalments, cleared at the end of the programming period

    • Annual pre-financing paid before 1 July:

      • 2% in 2016

      • 2,5% in 2017-2022

    • Annual pre-financing cleared annually with the clearance of accounts


    Interim payments

    Interim payments

    • Regular submission of payment applications with a compulsory statement of expenditure at the end of accounting year (by 31 July, with the cut-off date of 30 June)

    • Payments of the public contribution to beneficiaries and expenditure paid by beneficiaries before expenditure declared to Commission

    • Payment by Commission limited to 90% of amount calculated

    • Remaining balance to be paid after clearance of accounts


    Decommitment

    Decommitment

    • N+2 rule throughout the whole programming period

    • Exception for the first year

      • no automatic decommitment exercise for the first year commitment

      • first year commitment spread over the following years (1/6)

    • Exceptions for force majeure or legal proceedings and administrative appeals

    • No exceptions for major project and state aids


    Annual clearance of accounts

    Annual clearance of accounts

    • Accounting year = 1 July - 30 June

    • Submission by 1 February n+1 annually:

      • Annual accounts, certified by CA

      • Management declaration + report on controls carried out

      • Audit opinion + report on all available audits

    • Content of certified annual accounts:

      • Total eligible expenditure entered in CA accounts – paid by beneficiaries

      • Corresponding public support paid

      • Amounts withdrawn or recovered

      • ERDF/CF operations completed

      • Possible provision of maximum 5% for open audit issues

    • Commission decision on clearance by 30 April N+1:

      • Amount chargeable to the Fund (subject to subsequent financial corrections)


    Closure

    Closure

    • Rolling closure of completed operations (ERDF, CF) or expenditure (ESF) within the process of annual clearance of accounts

      • The 3- year retention period shall run from the 31 December of the year of the annual clearance of accounts (interrupted for legal and administrative proceedings). No controls or audits of operations or expenditure closed beyond this period

    • Final closure – submission of documents by 30 September 2013

      • an application for payment of the final balance;

      • a final implementation report for the operational programme;

      • the documents for the annual clearance of accounts for the final accounting year from 1 July 2022 to 30 June 2023.


    Interruption of the payment deadline

    Interruption of the payment deadline

    • The payment deadline may be interrupted for a maximum of 9 months where:

      • following information provided by a national or Union audit body, there is evidence to suggest a significant deficiency in the functioning of the management and control system;

      • the authorising officer by delegation has to carry out additional verifications following information coming to his attention alerting him that expenditure in a request for payment is linked to an irregularity having serious financial consequences;

      • there is a failure to submit one of the documents required for annual clearance of accounts.

    • Interruption may be limited to a part of expenditure covered by the payment application


    Suspension of payments

    Suspension of payments

    • All or part of the interim payments at the level of priority axes or operationalprogrammes may be suspended by the Commission where:

      • there is a serious deficiency in the management and control system of theoperational programme for which corrective measures have not beentaken;

      • expenditure in a statement of expenditure is linked to an irregularityhaving serious financial consequences which has not been corrected;

      • the Member State has failed to take the necessary action to remedy the situation giving rise to an interruption;

      • there is a serious deficiency in the quality and reliability of the monitoring system or of the data on common and specific indicators;

      • the Member State has failed to undertake actions set out in the operational programme relating to fulfilment of an ex ante conditionalities;

      • there is evidence resulting from a performance review that a priority axis has failed to achieve the milestones set out in the performance framework;

        + possibility of suspension envisaged in connection to the macro-economic conditionality.


    Financial corrections by the member state

    Financial corrections by the Member State

    • Member State is responsible for investigating irregularities and for making the financial corrections required and pursuing recoveries

    • The Member State shall make the financial corrections required in connection with individual or systemic irregularities detected in operations or operational programmes

    • The contribution recovered by the Member State may be reused by the Member State within the operational programme concerned, but not for operations that have been the subject of the correction or for any operation affected by a systemic irregularity


    Financial corrections by the commission 1

    Financial corrections by the Commission (1)

    • Commission shall make financial corrections where:

      • there is a serious deficiency in the management and control system of the operational programme which has put at risk the Union contribution already paid to the operational programme;

      • the Member State has not carried out the necessary financial corrections on its own;

      • expenditure contained in a payment application is irregular and has not been corrected by the Member State;

        + corrections envisaged in connection with the performance framework and review.

    • A breach of applicable Union or national law shall lead to a financial correction only where one of the following conditions is met:

      • the breach has or could have affected the selection of an operation by the responsible body for support by the CSF Funds;

      • there is a risk that the breach has or could have affected the amount of expenditure declared for reimbursement by the Union budget.


    Financial corrections by the commission 2

    Financial corrections by the Commission (2)

    • Financial corrections by the Commission can be based on precise amounts, but they can also be extrapolated or based on flat rates if the irregular amount cannot be quantified precisely

    • Financial corrections shall be proportionate taking into account the nature and the gravity of the irregularity

    • Where irregularities affecting annual accounts sent to the Commission are detected by the Commission or by the European Court of Auditors, the resulting financial correction shall reduce support from the Funds to the operational programme.


    Block 10

    Block 10

    Scope, thematic concentration

    in ERDF and CF regulations

    Article 16 of CPR

    Articles 1-5 of the ERDF regulation

    Articles 1-3 of the CF regulation

    Articles 1, 5 and 6 of the ETC regulation


    Scope of erdf

    Scope of ERDF

    • The scope defines what can and what cannot be supported by the ERDF

    • Investments in infrastructure providing basic services to citizens in the areas of environment, transport, and ICT are limited to the less developed and transition regions

    • More targeted support to large enterprises, focused on technology and applied research, including the first production of Key Enabling Technologies

    • Restrictions for support to tobacco industry, decommissioning of nuclear power stations and undertakings in difficulties


    Investment priorities

    Investment priorities

    All thematic objectives can be supported by the ERDF

    The regulation includes, for every thematic objective:

    A definitive list of investment priorities which set the aims for intervention by the Fund

    Example:

    Thematic objective: supporting the shift towards a low-carbon economy in all sectors

    Investment priorities:

    promoting the production and distribution of renewable energy sources

    promoting energy efficiency and renewable energy use in SMEs

    supporting energy efficiency and renewable energy use in publicinfrastructures and in the housing sector

    developing smart distribution systems at low voltage levels

    promoting low-carbon strategies for urban areas


    Legislative package

    Thematic Concentration for ERDF

    • The ERDF allocation for energy efficiency and renewables, innovation and SME support shall form at least:

      • 80% of the total ERDF resources at national level in developed and transition regions;

      • 60% of the total ERDF resources at national level in more developed and transition regions whose GDP per capita in 2007-2013 is below 75% of EU average;

      • 50% of the total ERDF resources at national level in less developed regions.

    • In addition the support to energy efficiency and renewables within this allocation must form at least:

      • 20% of the total ERDF resources at national level in more developed and transition regions;

      • 6% of the total ERDF resources at national level in less developed regions.


    Areas with specific natural or demographic features

    Areas with specific natural or demographic features

    Specific additional allocation for the outermost regions and sparsely populated regions.

    Outermost regions can use the allocation to support thematic objectives, but also for freight transport services and start-up aid for transport services; operations linked to storage constraints, the excessive size and maintenance of production tools, and lack of human capital in the local market, to finance operating aid and expenditure covering public service obligations and contracts in the outermost regions.

    At least 50% of the special allocation to outmost regions to be used for actions contributing to the diversification and modernisation of their economies, with particular focus on research and innovation, information and communication technologies and SMEs competitiveness


    Scope of the cohesion fund

    Scope of the Cohesion Fund

    Cohesion Fund supports:

    investments in the environment, including areas related to sustainabledevelopment and energy which present environmental benefits

    trans-European networks in the area of transport infrastructure, in compliancewith the guidelines adopted by Decision No 661/2010/EU

    technical assistance

    Appropriate balance of investments required

    Restrictions – decommissioning of nuclear power stations, housing


    Thematic objectives supported under the cohesion fund

    Thematic objectives supported under the Cohesion Fund

    Supporting the shift towards a low-carbon economy in all sectors

    Promoting climate change adaptation, risk prevention and management

    Protecting the environment and promoting resource efficiency

    Promoting sustainable transport and removing bottlenecks in key network infrastructures

    Enhancing institutional capacity and an efficient public administration by strengthening of institutional capacity and the efficiency of public administrations and public services related to implementation of the Cohesion Fund


    Investment priorities1

    Investment priorities

    The regulation includes, for every thematic objective:

    A definitive list of investment priorities which set the aims for intervention by the Fund

    Example

    Thematic objective: Protecting the environment and promoting resource efficiency

    Investment priorities

    addressing the significant needs for investment in the waste sector to meet therequirements of the Union's environmental acquis

    addressing the significant needs for investment in the water sector to meet therequirements of the Union's environmental acquis

    protecting and restoring biodiversity, including through green infrastructures

    improving the urban environment, including regeneration of brownfield sites and reduction of air pollution


    Block 11

    Block 11

    Scope, thematic concentration

    in ESF regulation

    Articles 1-4 of the ESF Regulation


    Thematic concentration for esf

    Thematic Concentration for ESF

    LESSDEVELOPEDREGIONS

    60% budget

    on 4 priorities

    MORE

    DEVELOPED

    REGIONS

    80% budget

    on 4 priorities

    TRANSITION

    REGIONS

    70% budget

    on 4 priorities

    20% budget on Social Inclusion

    - poverty reduction


    Scope of esf

    Scope of ESF

    Human capital as driver for smart, sustainable and inclusive growth

    18 Investment priorities in 4 thematic objectives:

    • Promoting employment and supporting labour mobility

    • Promoting social inclusion and combating poverty

    • Investing in education, skills and lifelong learning

      4.Enhancing institutional and administrative capacities

    ESF contribution to the other thematic objectives notably:

    • Supporting an environmentally sustainable economy (low carbon…)

    • Enhancing the accessibility, use and quality of ICT

    • Strengthening research and innovation

      4.Enhancing the competitiveness of SMEs


    Promoting employment and supporting labour mobility

    Promoting employment and supporting labour mobility

    • Access to employment for job-seekers and inactive people; including local employment initiatives and support for labourmobility;

    • Sustainable integration of young people not in employment,education or training into the labour market;

    • Self-employment, entrepreneurship and business creation;

    • Equality between men and women and reconciliation between workand private life;

    • Adaptation of workers, enterprises and entrepreneurs to change;

    • Active and healthy ageing;

    • Modernisation and strengthening of labour market institutions, including actions to enhance transnational labour mobility.


    Investing in education skills and life long learning

    Investing in education, skills and life-long learning

    • Reducing early school-leaving and promoting equal access to goodqualityearly-childhood, primary and secondary education

    • Improving the quality, efficiency and openness of tertiary andequivalent education with a view to increasing participation andattainment levels

    • Enhancing access to lifelong learning, upgrading the skills andcompetences of the workforce and increasing the labour marketrelevance of education and training systems


    Promoting social inclusion and combating poverty

    Promoting social inclusion and combating poverty

    • Active inclusion

    • Integration of marginalised communities such as the Roma;

    • Combating discrimination based on sex, racial or ethnic origin,religion or belief, disability, age or sexual orientation

    • Enhancing access to affordable, sustainable and high-qualityservices, including health care and social services of generalinterest

    • Promoting the social economy and social enterprises

    • Community-led local development strategies


    Enhancing institutional capacity and efficient public administration

    Enhancing institutional capacity and efficient public administration

    • Investment in institutional capacity and in the efficiency of publicadministrations and public services with a view to reforms, better regulation and good governance

    • Capacity building for stakeholders delivering employment,education and social policies and sectoral and territorial pacts tomobilise for reform at national, regional and local level


    Esf s reinforced social dimension

    ESF’s reinforced social dimension

    • Focusing on the most vulnerable: 20% of ESF allocations for social inclusion and poverty reduction actions

    • Greater emphasis on fighting youth unemployment

    • Mainstreaming & specific support for gender equality & non-discrimination

    • Possibility to involve social partners and NGOs through global grants and through allocation of appropriate amounts of resources for capacity building


    Financial instruments and esf

    Financial instruments and ESF

    • Key for leveraging resources

    • Widening of ESF support through financial instruments to job creation, mobility of workers and students, social inclusion

    • Enhance access to capital markets through an ESF policy based guarantee


    Block 12

    Block 12

    European Territorial Cooperation


    Architecture

    Architecture

    • Cross-border cooperation

      • COM to adopt list of cross-border areas to receive support by programme (at NUTS 3 level)

      • List specifies border areas covered by IPA/ENI

      • List includes regions in NO, CH etc. and countries neighbouring outermost regions for information purposes

      • Addition of adjacent NUTS 3 regions may be proposed when submitting programmes


    Architecture1

    Architecture

    • Transnational cooperation

      • COM to adopt list of transnational areas to receive support by programme (at NUTS 2 level)

      • Third country regions covered by ENI (incl. Russia) and IPA can also be covered by programme, funding to be made available.

      • Third country regions included in list for information purposes

      • Addition of adjacent NUTS 2 regions may be proposed when submitting programmes

      • Interregional cooperation – EU-27, whole or part of territory of third countries may be covered


    Financial resources

    Financial Resources

    • 3 categories

      • 73%for cross-border cooperation (EUR 8.6 bn)

      • 21% for transnational (EUR 2.4 bn)

      • 6% for interregional (EUR 0,7 bn)

    • EUR 50 million to be set aside from interregional allocation for outermost regions cooperation, ERDF support for outermost regions’ cooperation not to be less than 150% of 2007-2013 level)

    • Population = criterion for breakdown by Member State

    • 75% co-financing rate (50% for outermost regions’ allocation)


    Financial resources1

    Financial Resources

    • ERDF transfer to ENI and IPA

      • Amount to be transferred to be established by COM and MS

      • If no programme submitted, funds to be allocated to internal CBC programmes of Member State concerned

      • Programme to be discontinued if none of the partners countries have signed the financing agreement by deadline established in ENI regulation


    Thematic concentration

    Thematic Concentration

    • 4 thematic objectives for cbc and transnational

    • Interregional can cover all thematic objectives

    • Definition of investment priorities in ERDF regulation apply

    • Additional element in ETC regulation: ESF-type actions, legal and administrative cooperation and cooperation between citizens and institutions, macro-regional strategies


    Monitoring evaluation and ta

    Monitoring, Evaluation and TA

    • First annual report to be submitted in 2016

    • Lighter annual reports, regular electronic exchange of data

    • More strategic reports in 2017 and 2019

    • Annual review can also be carried out in writing

    • Common output indicators, programme specific output and result indicators

    • Programme TA: Maximum of 6% of ERDF allocation, but not less than 1,5 mio. EUR


    Implementing arrangements

    Implementing arrangements

    • Eligibility rules established at EU level complemented by rules established by the Monitoring Committee (national rules as a last resort)

    • Merger between the managing authority and the certifying authority; controls and audits should be carried out for the programme area as a whole

    • N+3


    Egtc regulation

    EGTC regulation

    • Amendment of the present regulation

    • Broadening of the EGTC and its use, including:

      • the possibility to involve national authorities

      • inclusion of members from third countries and overseas territories

      • possibility to set up EGTC between 1 MS and 1 non-MS

    • New deadline for state approval of EGTC – 6 months


    Block 13

    Block 13

    Comitology, definitions etc.

    Articles 1,2 and 80 of CPR

    Articles 141-147 of CPR

    Articles 12-17 of the ERDF regulation

    Articles 12-17 of the ERDF regulation

    Articles 5-8 of the CF regulation

    Articles 29-33 of the ETC regulation


    Comitology

    Comitology

    • Application of the Lisbon treaty

      • Delegated acts

      • Implementing acts without the involvement of committees

      • Implementing acts subject to a committee procedure


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