Transcript Challenges
European Union Regional Policy – Employment, Social Affairs and Inclusion EU Cohesion Policy 2014-2020 Proposals from the European Commission Structural Actions Working Party 12-13 October 2011 1 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 2 European Union Regional Policy – Employment, Social Affairs and Inclusion 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. 3 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 4 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 5 European Union Regional Policy – Employment, Social Affairs and Inclusion Budget for Cohesion Policy post 2013 billion EUR (2011 prices) Cohesion Fund* 68.7 Less developed regions 162.6 Transition regions 39.0 More developed regions 53.1 Territorial Cooperation 11.7 Extra allocation for outermost and northern regions TOTAL** Connecting Europe facility for transport, energy and ICT TOTAL 0.9 336.0 40.0 376.0 *Cohesion Fund will ringfence 10 billion EUR for the new Connecting Europe Facility **Includes 2,5 billion EUR allocation for food for deprived persons 6 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 7 European Union Regional Policy – Employment, Social Affairs and Inclusion 8 European Union Regional Policy – Employment, Social Affairs and Inclusion • 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 phasingout of Cohesion Fund 9 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 average GDP per capita for the period 2007 to 2009 was below 85 % of the EU-27 average 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 Cohesion Fund 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 capita for the 2007-2013 period was less than 75% of the average of the EU-25 for the reference period but whose GDP per capita is above 75% of the GDP 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 10 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 11 European Union Regional Policy – Employment, Social Affairs and Inclusion Block 2 Strategic Approach (common provisions for the CSF Funds) Articles 3-15 of CPR 12 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 13 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 14 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 15 European Union Regional Policy – Employment, Social Affairs and Inclusion Strengthening the Strategic Approach Common Strategic Framework Partnership contract Operational Programmes 16 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 17 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 18 European Union Regional Policy – Employment, Social Affairs and Inclusion Adoption and amendment of the partnership contract • The Commission shall assess the consistency of the Partnership Contract with the CPR, with the Common Strategic Framework, and 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 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 States shall propose amendments, where necessary, to their Partnership Contract and programmes to ensure their consistency with the revised Common Strategic Framework 19 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 20 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 fulfilment defined 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 21 European Union Regional Policy – Employment, Social Affairs and Inclusion 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. 22 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 23 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 24 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 25 European Union Regional Policy – Employment, Social Affairs and Inclusion 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. 26 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 27 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 28 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 29 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 30 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 31 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 32 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 33 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 34 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 35 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 36 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 results necessary 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 37 European Union Regional Policy – Employment, Social Affairs and Inclusion Block 5 Territorial development (common and specific provisions) Articles 28-31 of CPR Articles 99 of CPR Articles 7-11 of the ERDF Regulation 38 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 39 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 affected by poverty or target groups at highest risk of discrimination or exclusion with special regard to marginalised communities – contribution highlighted in the content of each OP 40 European Union Regional Policy – Employment, Social Affairs and Inclusion Block 6 Financial instruments (common provisions for the CSF Funds) Articles 32-40 of CPR Article 15 of the ESF Regulation 41 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 42 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 43 European Union Regional Policy – Employment, Social Affairs and Inclusion 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) 44 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 the “2 year rule” 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) 45 European Union Regional Policy – Employment, Social Affairs and Inclusion Block 7 Monitoring, evaluation and indicators Information and communication (both common and specific provisions) 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 46 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 47 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 48 European Union Regional Policy – Employment, Social Affairs and Inclusion A Focus 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 49 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 50 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 evaluation by the Commission 51 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 52 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 53 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 54 European Union Regional Policy – Employment, Social Affairs and Inclusion Changes in eligibility rules (1) • An operation may receive support from one or more CSF Funds and from other Union instruments, provided that the expenditure item included in a payment application for reimbursement by one of the CSF Funds does not receive support from another Fund • Net revenue directly generated by an operation during its implementation which has not been taken into account at the time of approval of the operation, shall be deducted from the eligible expenditure of the operation in the final payment claim submitted by the beneficiary. This rule shall not apply to financial instruments and prizes • Operations shall not be selected for support by the CSF Funds where they have been physically completed or fully implemented before the application for funding under the programme is submitted by the beneficiary to the managing authority 55 European Union Regional Policy – Employment, Social Affairs and Inclusion Changes in eligibility rules (2) • In the case of repayable assistance, the support repaid to the body that provided it, or to another competent authority of the Member State, shall be kept in a separate account and reused 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 are not recoverable under national VAT legislation and are paid by a beneficiary other than non-taxable person as defined in the first subparagraph of Article 13(1) of Directive 2006/112/EC, provided that such VAT amounts are not incurred in relation to the provision of infrastructure 56 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 57 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 58 European Union Regional Policy – Employment, Social Affairs and Inclusion 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). 59 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 at national or regional level. 60 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 61 European Union Regional Policy – Employment, Social Affairs and Inclusion Block 9 Management and control Financial Management (both common and specific provisions) Articles 62-79 of CPR Articles 112-140 of CPR 62 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 63 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 64 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 65 European Union Regional Policy – Employment, Social Affairs and Inclusion 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) 66 European Union Regional Policy – Employment, Social Affairs and Inclusion The functions of the certifying authority Definition of responsibilities relating to: – drawing up, submission and certification of payment applications – drawing up and certification of the annual accounts – ensuring that there is a system which records and stores accounting records for each operation – ensuring that it has received adequate information from the managing authority on the procedures 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 declared to the Commission and the corresponding public contribution paid to beneficiaries – keeping an account of amounts recoverable and of amounts withdrawn 67 European Union Regional Policy – Employment, Social Affairs and Inclusion 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” 68 European Union Regional Policy – Employment, Social Affairs and Inclusion 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) 69 European Union Regional Policy – Employment, Social Affairs and Inclusion Accounting year and clearance of accounts Compulsory interim payment application Accounting year 1 Jul N -1 Dec N-1 Clearance of accounts 30 Jun N Dec 1 Feb N+1 N 30 Apr 30 Jun N+1 N+1 Preparation of the annual accounts, management declaration, audit report, audit opinion 70 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 71 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 72 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 73 European Union Regional Policy – Employment, Social Affairs and Inclusion 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) 74 European Union Regional Policy – Employment, Social Affairs and Inclusion 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. 75 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 76 European Union Regional Policy – Employment, Social Affairs and Inclusion Suspension of payments • All or part of the interim payments at the level of priority axes or operational programmes may be suspended by the Commission where: – there is a serious deficiency in the management and control system of the operational programme for which corrective measures have not been taken; – expenditure in a statement of expenditure is linked to an irregularity having 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 macro77 economic conditionality. European Union Regional Policy – Employment, Social Affairs and Inclusion 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 78 European Union Regional Policy – Employment, Social Affairs and Inclusion 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. 79 European Union Regional Policy – Employment, Social Affairs and Inclusion 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. 80 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 81 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 the ETS sector, the tobacco industry, decommissioning of nuclear power stations and undertakings in difficulties 82 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 public infrastructures and in the housing sector • developing smart distribution systems at low voltage levels 83 • promoting low-carbon strategies for urban areas European Union Regional Policy – Employment, Social Affairs and Inclusion 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 20072013 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 84 regions. European Union Regional Policy – Employment, Social Affairs and Inclusion 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 85 European Union Regional Policy – Employment, Social Affairs and Inclusion Scope of the Cohesion Fund • Cohesion Fund supports: – investments in the environment, including areas related to sustainable development and energy which present environmental benefits – trans-European networks in the area of transport infrastructure, in compliance with the guidelines adopted by Decision No 661/2010/EU – technical assistance • Appropriate balance of investments required • Restrictions – decommissioning of nuclear power stations, ETS sector, housing 86 European Union Regional Policy – Employment, Social Affairs and Inclusion Thematic objectives supported under the Cohesion Fund 1. Supporting the shift towards a low-carbon economy in all sectors 2. Promoting climate change adaptation, risk prevention and management 3. Protecting the environment and promoting resource efficiency 4. Promoting sustainable transport and removing bottlenecks in key network infrastructures 5. 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 87 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 the requirements of the Union's environmental acquis – addressing the significant needs for investment in the water sector to meet the requirements 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 88 European Union Regional Policy – Employment, Social Affairs and Inclusion Block 11 Scope, thematic concentration in ESF regulation Articles 1-4 of the ESF Regulation 89 European Union Regional Policy – Employment, Social Affairs and Inclusion Thematic Concentration for ESF LESS DEVELOPED REGIONS TRANSITION REGIONS MORE DEVELOPED REGIONS 60% budget on 4 priorities 70% budget on 4 priorities 80% budget on 4 priorities 20% budget on Social Inclusion - poverty reduction 90 European Union Regional Policy – Employment, Social Affairs and Inclusion Scope of ESF Human capital as driver for smart, sustainable and inclusive growth 18 Investment priorities in 4 thematic objectives: 1. Promoting employment and supporting labour mobility ESF contribution to the other thematic objectives notably: 1. Supporting an environmentally sustainable economy (low carbon…) 2. Promoting social inclusion and combating poverty 2. Enhancing the accessibility, use and quality of ICT 3. Investing in education, skills and lifelong learning 3. Strengthening research and innovation 4. Enhancing institutional and administrative capacities 4. Enhancing the competitiveness of SMEs 91 European Union Regional Policy – Employment, Social Affairs and Inclusion Promoting employment and supporting labour mobility • Access to employment for job-seekers and inactive people; including local employment initiatives and support for labour mobility; • 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 work and 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. 92 European Union Regional Policy – Employment, Social Affairs and Inclusion Investing in education, skills and lifelong learning • Reducing early school-leaving and promoting equal access to goodquality early-childhood, primary and secondary education • Improving the quality, efficiency and openness of tertiary and equivalent education with a view to increasing participation and attainment levels • Enhancing access to lifelong learning, upgrading the skills and competences of the workforce and increasing the labour market relevance of education and training systems 93 European Union Regional Policy – Employment, Social Affairs and Inclusion 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-quality services, including health care and social services of general interest • Promoting the social economy and social enterprises • Community-led local development strategies 94 European Union Regional Policy – Employment, Social Affairs and Inclusion Enhancing institutional capacity and efficient public administration • Investment in institutional capacity and in the efficiency of public administrations 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 to mobilise for reform at national, regional and local level 95 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 96 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 • 97 European Union Regional Policy – Employment, Social Affairs and Inclusion Block 12 European Territorial Cooperation 98 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 99 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 100 European Union Regional Policy – Employment, Social Affairs and Inclusion 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) 101 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 102 European Union Regional Policy – Employment, Social Affairs and Inclusion 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, macroregional strategies 103 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 104 European Union Regional Policy – Employment, Social Affairs and Inclusion 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+3 105 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 106 European Union Regional Policy – Employment, Social Affairs and Inclusion 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 107 European Union Regional Policy – Employment, Social Affairs and Inclusion Comitology • Application of the Lisbon treaty – Delegated acts – Implementing acts without the involvement of committees – Implementing acts subject to a committee procedure 108