EU Financial Framework for Grants 1' Expenditure

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EU Financial Framework for Grants1. Expenditure

• Derek Stubbs
• The Lyndhurst Partnership

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EU Grants

• A direct payment
• of a non-commercial nature
• by the European Commission
• to promote an EU policy aim

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Grant Payments

• Depending on the programme, grants may be paid
• Directly to the beneficiary by the Commission
• Indirectly via
• A Member State (or foreign government)
• A National Agency or some other body designated
  by a State

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Calls for Proposals

• Grant funding opportunities are publicised
  through Calls for Proposals
• Published periodically in the Official Journal of
  the European Community, Series C
• Published on web sites of individual EU
  Directorates-General and specific EU Programmes
  and through national centres
• Not to be confused with Calls for Tender (i.e.
  for supply of specific services)

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Key Elements of Call

• Reference to specific EU Action Programme
• Eligible applicants organisations, countries,
  etc
• Eligible measures types of activity
• Duration start/end of activities
• Available financial support conditions
• Deadline application procedures
• Guidelines, application budget forms

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Types of grant funding

• Flat rate grants
• Fixed amount / lump sum payment (e.g. Leonardo
  Partnership grants)
• Fixed scales of unit costs
• Reimbursement of all / part of actual costs on a
  percentage basis

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Co-financing

• The majority of EU projects are co-financed.
• The Community contribution covers only part of
  the costs
• age contribution varies according to Programme
  (and sometimes type of organisation)
• The applicant/partners must provide the balance
  usually in the form of a cash contribution
• In small number of cases, EC provides 100
  funding

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Typical Budget Categories

• Direct Eligible Costs (D)
• Staff Costs (D1)
• Travel Costs (D2)
• Services/Activities (D3)
• Administration (D4)
• Indirect Eligible Costs (I)
• Overheads

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Eligible Costs

• Eligible Costs
• are the SUM of
• Direct Eligible Costs (D) and
• Indirect Eligible Costs (I)
• Eligible Costs D I

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Direct Eligible Costs (D)

• Must be reasonable value for money
• Be based on real costs not a fixed price
• Be essential to carry out the project
• Be incurred during the period of the project
• Be identified and recorded dual entry,
  computerised accounts Credits/Debits separate
  bank account?
• Be supported by appropriate documents e.g.
  staff time sheets, invoices and receipts, travel
  tickets, signed attendance sheets

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Direct Eligible Costs (D)STAFF COSTS (D1)

• Project Coordinator, Administrator, Secretary,
  Accountant, Researcher, Trainer, Internal Expert,
  etc.
• No. of days worked x daily rate
• Average 20 days per month max. 220 days per
  year
• Must be employee
• Gross salaries including social costs but not
  other payments expenses (N.B. May be maximum
  pay rates per grade)
• Subcontracted staff dealt with under
  Activities/Services (D3)

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Direct Eligible Costs (D)TRAVEL COSTS (D2)

• Planning meetings, seminars, conferences,
  research trips, exchanges
• Train less than 200km return journey 2nd
  Class. Over 200km 1st Class
• Air more than 800km return trip only APEX
  only retain ticket stubs
• Car equivalent of 1st Class rail fare or
  sometimes 0.22 - 0.25 per km
• Local travel daily subsistence allowance
• Taxis only with prior approval

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Direct Eligible Costs (D)TRAVEL COSTS (D2)

• Subsistence if over 100km from home
  accommodation, meals, local travel
• Invoiced cost or daily subsistence allowance
• No. of participants x no. of days x daily rate
• Different national maximum rates subject to
  change
• Calculate pro-rata, if less than whole days

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Direct Eligible Costs (D)SERVICES/ACTIVITIES (D3)

• Relates to the main activities of the project
• Details will vary from project to project but
  likely to contain some of following
• External experts, consultants, trainers
• Publications (printed or electronic)
• Translations
• Interpreters

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Direct Eligible Costs (D)SERVICES/ACTIVITIES (D3)

• External experts, consultants, trainers
• If not employed by project partner, must be
  regarded as sub-contracted
• Procurement rules
• Less than 200 just requires invoice
• 200 - 3,500 needs only 1 offer
• 3,500 25,000 needs 3 tenders written
  contract
• 25,000 - 60,000 restricted tender by minimum
  5 suppliers
• 60,000 prior approval by Commission
• Maximum sub-contracting 35 of total budget
• Need to justify need for sub-contracting

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Direct Eligible Costs (D)SERVICES/ACTIVITIES (D3)

• Publications
• Includes everything other than photocopying
• Include design, layout, artwork
• Provide details of no. of pages, no. of copies,
  which languages for printed publications
• May include electronic publications e.g. CD-ROM,
  web site
• May need to treat as sub-contracted services

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Direct Eligible Costs (D)SERVICES/ACTIVITIES (D3)

• Translations
• No. of languages
• No. of pages
• Rate per page

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Direct Eligible Costs (D)SERVICES/ACTIVITIES (D3)

• Interpreters
• Specify no. of languages x no. of interpreters x
  no. of days
• Must hire locally where possible
• Maximum daily fee 700 must include any travel
  and subsistence costs

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Direct Eligible Costs (D)ADMINISTRATION (D4)

• Costs associated with administering the project
• Details will vary from project to project but
  likely to contain some of following
• Equipment costs
• Room hire
• Finance costs
• Audit costs

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Direct Eligible Costs (D)ADMINISTRATION (D4)

• Equipment costs
• Rental of interpreting booths, microphones
  technician
• Specialist IT equipment e.g. web server, video
  projector
• Rent or buy? Purchase cost not allowed only
  allowance for depreciation
• Normally IT equipment related to project
  administration is considered an Indirect Cost

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Direct Eligible Costs (D)ADMINISTRATION (D4)

• Standard depreciation allowances
• Depreciation over 3 years
• Depreciation over 5 years for IT/AV equipment
  over 10,000
• Qualified by amount of usage within project
• Example photocopier - purchase cost 999
• Annual depreciation 999/3 333
• Shared usage - half-time use in project for 9
  months
• Allowance 3330.75/2 124.88

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Direct Eligible Costs (D)ADMINISTRATION (D4)

• Room hire
• Rental of rooms for seminars, conferences,
  meeting rooms, temporary offices
• Not provision of accommodation owned by partner
  organisations

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Direct Eligible Costs (D)ADMINISTRATION (D4)

• Finance costs
• Bank charges
• Financial guarantees
• Insurance

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Direct Eligible Costs (D)ADMINISTRATION (D4)

• Audit costs
• Carried out by independent body or expert
  officially authorised to audit accounts
• Distinct from audit by the European Commission

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Indirect Eligible Costs (I)

• General costs directly generated by the project
  activities overheads
• General office costs (stationery, copying, mail,
  telephone), heating and lighting, etc.
• Do not need to be supported by documentation
• Must not exceed 7 of the total Direct Eligible
  Costs. (NB. Not 7 of Total Eligible Costs)

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Ineligible costs

• Anything else is
• INELIGIBLE

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Ineligible costs

• Costs that would have been incurred anyway
• Costs outside period
• Costs without documentation
• Costs not in budget or not related to project
  activities
• Costs already financed under other EU programmes
• Costs incurred outside approved territories

• Costs of transport between home and work
• Purchase of land or buildings
• Debt charges and interest payments
• Provisions for losses contingency reserves
• VAT unless the promoter or partner can show that
  they are unable to recover it

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Currency

• Unless stated otherwise, all sums should be shown
  in Euros
• Official monthly exchange rates for budgetary
  purposes obtainable at
• http//ec.europa.eu/budget/inforeuro