Brussels, 29 October 2012
Faster and simpler access to EU funds for European businesses, towns, regions and scientists
Following the recent entry into force of the new Financial Regulation the Commission has adopted its new detailed Rules of application. The delivery of EU funds to businesses, NGOs, researchers, students, municipalities and other recipients will be improved as of 1 January 2013 thanks to simplified procedures. The new legislation increases transparency and introduces higher accountability for anyone dealing with EU finances. It includes wider possibilities to use lump sums and flat rates for smaller amounts, eliminates the need to fill in the same details every time you apply for EU funds and introduces on-line applications as well as many other new features.
“This new regulation brings significant improvements to all beneficiaries of EU funding. We succeeded in reducing administrative burden for recipients of Union funds, which translates into easier access and a shortened time span for getting funding from the European budget. The new rules pave the way for a more effective use of EU resources. It is important for any European citizen as in the times of crisis the EU budget plays an important role in boosting jobs and growth. Making EU funds more accessible and increasing the accountability of those who manage these funds is one of the major tasks of my mandate” said Janusz Lewandowski, European Commissioner for budget and financial programming.
The revised Financial Regulation contains numerous improvements which will make the life of recipients of Union funds easier. The period between calls for proposals and the conclusion of grant agreements and payment deadlines will be shortened. The emphasis of the grant system will be shifted from reimbursing cost claims to payments for the delivery of results through a greater use of lump sums, flat rates, unit costs. A greater use of prizes, paid to the winner of a contest for developing the solution to a pre-defined problem ('inducement prizes') will also contribute to simplify administration and strengthen the result-orientation of EU funding. Beneficiaries of EU funds will no longer be obliged to open separate interest bearing bank accounts. Furthermore, even if interest is generated, it will not have to be returned to the EU Budget and neither will it be counted as revenue of the project. This addresses a major concern of grant beneficiaries and other stakeholders, in particular from the research and the NGO community, that was brought up during the public consultation of 2009 preceding the Commission's proposal of 2010.
More accountability and protection for European citizens
The new rules will increase the accountability of those managing EU taxpayers' money. This includes the Member States, which implement a large proportion of the EU budget, including the EU's regional policy. In future, Member State authorities managing EU funds will have to sign and submit to the Commission annual declarations certifying that EU funds have been used correctly.
Mechanisms for financial corrections in cases of irregularities committed by beneficiaries and discovered through audit have been strengthened: as a deterrent, the Commission will publish decisions imposing sanctions for misuse of EU funds.
Enhancing the effectiveness of EU funds through innovative funding mechanisms
In the future, various financial instruments, such as loans, equity or guarantees will be used to enhance the effectiveness of EU funds and thus multiply their financial impact. New possibilities are created for a more flexible implementation of public-private partnerships ('PPPs') which reflects the calls of European industry stakeholders who are the partners in such PPPs.
In the area of external action, the EU will be able to create EU trust funds pooling its own resources with those of its Member States and other donors in order to better coordinate and deliver external aid and increase its visibility.
Commission determined to push the simplification agenda further
Simplifying rules and processes will not stop after the adoption of the new Financial Regulation. The Commission will continue to pursue its multiple simplification proposals so that they are firmly anchored in the new generation of programmes (2014-2020), currently under negotiation in the Council and the European Parliament.
The Financial Regulation is the core of EU financial rules. It sets the principles of the EU budget and governs the way the EU funds are spent. The present version was adopted in 2002 and most recently amended in 2010 to cover the creation of the European External Action Service. The legislative procedure of this more substantial revision was initiated by the Commission in December 2010, when the Commission's proposal on the review of the Financial Regulation addressed the main concerns raised by beneficiaries of EU funds. The new rules will focus on simpler and faster access to funds, while strengthening accountability of those managing EU taxpayers' money.
After the formal adoption of the Financial Regulation on 25 October and its publication in the Official Journal of the EU, the Financial Regulation entered into force on 27 October 2012.
Following this the Commission adopted today the new Rules of application for the new Financial Regulation which contain detailed rules for financial management and complement the Financial Regulation. Within the next two months, the European Parliament and the Council can express objections or give their comments to these Rules of application as proposed by the Commission. After the publication in the Official Journal and entry into force at the end of December 2012 the new Rules of application will start to be applied as from 1 January 2013 together with new Financial Regulation.
Link to: MEMO/12/795