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.
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.
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.
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.