Special Report Technical assistance: what 
contribution has it made 
to agriculture and rural 
development? EN 2015  NO 04
EUROPEAN
COURT
OF AUDITORS

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Luxembourg: Publications Office of the European Union, 2015
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Technical assistance: what 
contribution has it made 
to agriculture and rural 
development? 
(pursuant to Article 287(4), second subparagraph, TFEU)Special ReportEN 2015  NO 04
02  Audit team
The ECA’s special reports set out the results of its performance and compliance audits of specific budgetary areas or 
management topics. The ECA selects and designs these audit tasks to be of maximum impact by considering the risks 
to performance or compliance, the level of income or spending involved, forthcoming developments and political and 
public interest.
This performance audit was produced by Audit Chamber I — headed by ECA member Rasa Budbergytė — which spe ‑
cialises in preservation and management of natural resources spending areas. The audit was led by ECA member Kersti 
Kaljulaid, supported by Helder Faria Viegas, head of unit; Csaba Bartos, team leader; Blanka Happach, deputy team leader; 
Maciej Szymura auditor; Carlos Sanchez Rivero, auditor; Roberto Resegotti, auditor; Tom Everett, drafting assistance.
From left to right: B. Happach, R. Resegotti, Cs. Bartos, M. Szymura, K. Kaljulaid, 
C. Sanchez Rivero, T. Everett, H. Faria Viegas.
03
 Contents
Paragraph
 Abbreviations
I–VII  Executive summary
1–16  Introduction
1–4 What is technical assistance?
5–10  The recent history of technical assistance in agriculture and rural development
11–13  Rules and regulations
14–16  Budgeting and spending levels
17–23  Audit scope, objectives and approach
17–19  Audit scope and objectives
20–23  Audit approach
24–82  Observations
24–51  How is money for technical assistance actually spent?
26–28  A problem of clarity
29–35  At the Commission, a shift towards administrative costs
36–51  In the Member States, an emphasis on payroll
52–59  Are the costs eligible?
52–53  Some formal ineligibility at the Commission
54–59  More frequent problems in the Member States
04 Contents
60–82  How suitable is the performance framework for TA?
64–67  Poor planning and assessment of needs
68–70  Objectives far from SMART
71–75  Limited monitoring and evaluation
76–78  The impact of an inadequate performance framework
79–82  Networking: potential for an effective performance framework
83–93  Conclusions and recommendations
 Annex  —  Financial planning of technical assistance in rural development for 
2007–13  and  2014–20
 Reply of the Commission
05
 Abbreviations
CAP : Common agricultural policy
CMEF : Common monitoring and evaluation framework
EAFRD : European Agricultural Fund for Rural Development
EAGF : European Agricultural Guarantee Fund
EAGGF : European Agricultural Guidance and Guarantee Fund — predecessor (1962–2006) to the EAGF and EAFRD
ENRD : European Network of Rural Development
RDP : Rural development programme
Sapard : Special accession programme for agriculture and rural development — instrument set up to assist 
candidate countries (2000–06) with the necessary structural adjustments in agriculture and rural areas prior to 
membership of the EU
06
 Executive  
summary
I
Technical assistance (TA) has traditionally been con ‑
cerned with the provision of expertise and funding 
to support government departments in the delivery 
of programmes linked to policy objectives. In the 
EU’s ‘Agriculture and rural development’ policy area, 
TA takes the form of funding in separate areas of the 
common agricultural policy  — the European Agricul ‑
tural Guarantee Fund (EAGF) (Pillar I) and the European 
Agricultural Fund for Rural Development (EAFRD) (Pil ‑
lar II). Expenditure should contribute to the develop ‑
ment of administrative capacity and implementation 
of programmes under the two pillars by the Commis ‑
sion and the Member States.
II
The Court audited the use of TA funding in agriculture 
and rural development during the 2007–13 period. 
By the end of 2013, the Commission and the Member 
States had spent half of their TA budget of 1.8 bil ‑
lion euro in this policy area, with the remainder avail ‑
able for spending until the end of 2015.
III
The audit focused on the management of techni ‑
cal assistance and its contribution to the core policy 
objectives. This was done by examining which activi ‑
ties were supported by TA funding at the Commission 
and in the Member States, whether the costs claimed 
were eligible and whether the arrangements for meas ‑
uring TA performance were appropriate and effective.
IV
The Court found that the Commission and the Mem ‑
ber States have taken full advantage of the regula ‑
tory flexibility in this area. However, the freedom of 
choice has resulted in a lack of rigour about the goals 
of funding and how it can be used. For the audited 
period there was a move away from a ‘capacity‑build ‑
ing’ understanding of TA towards support for regular 
administrative costs, such as payroll and IT mainte ‑
nance. Using TA in this way raises questions about its 
specific contribution to overall programme goals.
07 Executive summary 
V
Another consequence of the Commission’s insuf ‑
ficiently prescriptive approach to TA use lies in the 
area of eligibility. Because administrative costs are 
often shared between Pillar I and Pillar II, there can be 
confusion over the correct allocation of expenditure to 
a specific fund. This problem has mainly arisen in the 
Member States, where there is largely no entitlement 
to TA co‑financing under Pillar I. The fact that admin ‑
istrative costs are eligible under Pillar II only, or (at 
the Commission) have to be divided between the two 
pillars, has meant complex administrative procedures 
to justify the way they are allocated, and these are not 
always adequately applied.
VI
The use of all CAP funding is regulated by require ‑
ments relating to guarantees on the appropriateness 
of expenditure through a monitoring and evaluation 
framework. Being largely non‑operational, however, 
technical assistance was excluded from this frame ‑
work. As a result, transparency and accountability are 
compromised and it is impossible to say whether TA 
resources are being used effectively and efficiently. 
There is also a risk that diverting funds away from 
capacity‑building measures linked to the core fund ‑
ing objectives will penalise final beneficiaries — more 
especially, owing to the structure of co‑financing, in 
the EU’s poorer regions.
VII
Overall, the Court concludes that owing to the 
absence of a suitable performance framework for TA 
expenditure in agriculture and rural development, nei ‑
ther the Commission nor the Member States are able 
to demonstrate how well technical assistance has con ‑
tributed to the general policy objectives of the CAP .The Court therefore makes the following 
recommendations.
 ο The Commission should clarify the scope and 
application of technical assistance of Member 
States in the area of rural development. In par ‑
ticular, it should clarify the distinction between 
operational/‘capacity‑building’ expenditure and 
eligible administrative/‘budget support’ costs, 
notably in the case of payroll.  
Such clarification would improve transparency 
about the ways funding can be used. The Commis ‑
sion should closely monitor the Member States’ 
implementation of TA.
 ο The Commission should also take appropriate 
measures to ensure that general administrative 
expenditure such as regular IT maintenance is not 
charged to technical assistance budget lines.
 ο The Commission should, in future, require Member 
States to report administrative/‘budget support’ 
costs for rural development separately so as to 
make it more transparent that part of TA funding is 
spent on such support.
 ο The Commission and the Member States should 
establish a suitable performance framework for TA 
funding. In particular, the TA needs of the Commis ‑
sion and of the Member States should be prop ‑
erly assessed and there should be a mechanism 
in place to set objectives and measure progress 
towards them.
08
 Introduction
What is technical 
assistance?
01 
Technical assistance (TA) in the inter ‑
national context has been defined 
as ‘the provision of know‑how in the 
form of personnel, training, research 
and associated costs’1. It is generally 
delivered, in the framework of devel ‑
opment aid from the Organisation for 
Economic Cooperation and Develop ‑
ment (OECD), the United Nations (UN) 
and other international organisations, 
through expertise and advice to assist 
states with development programmes.
02 
For the EU, the delivery of specific 
expertise is characteristic of techni ‑
cal assistance measures in the area of 
external support for developing coun ‑
tries and other non‑Member States. 
The Commission also provides TA, in 
the form of funding, through three 
other main channels:
 ο it meets the costs of executive 
agencies set up to manage pro ‑
jects and programmes in both 
specific and cross‑cutting policy 
areas;
 ο it has established headings, 
financed by the operational bud ‑
get2, for its directorates‑general to 
run, manage and coordinate pro ‑
grammes in specific policy areas;
 ο it co‑finances the Member States’ 
use of TA in connection with EU 
funds (e.g. EAFRD, European Fish ‑
eries Fund (EFF), Cohesion spend ‑
ing, European Regional Develop ‑
ment Fund (ERDF)) to facilitate the 
implementation of national and 
regional programmes or actions.03 
This audit report covers the last two 
of these areas of expenditure, corre ‑
sponding to the way technical assis ‑
tance funding is used in the ‘Agricul ‑
ture and rural development’ policy 
area.
04 
Traditionally, the cost categories 
financed in this way are preparation of 
studies and evaluation reports, the or ‑
ganisation of meetings and seminars, 
training and the services of external 
experts. However, funding can also 
cover staff costs, IT development 
and maintenance, information and 
publicity activities and networking. 
Expenditure should be programme ‑
specific and should contribute to 
overall policy aims in administrative 
capacity development and programme 
implementation.1 OECD definition in DAC 
Statistical Reporting Directive, 
12 November  2010, 
paragraphs 47 to 48.
2 As the Commission is the only 
EU institution with an 
operational budget, it alone is 
responsible for financing, 
implementing and supervising 
TA funding at EU level.
09 Introduction
The recent history of 
technical assistance in 
agriculture and rural 
development
05 
The rules on the use of technical assis ‑
tance in agriculture are not the same 
for Pillar I of the common agricultural 
policy (CAP) (market measures and 
direct aid through the EAGF) and Pillar 
II (rural development support through 
the EAFRD).
06 
Between 2000 and 2004, the only TA 
co‑financing available to Member 
States in rural development came from 
the ‘Guidance’ section of the European 
Agricultural Guidance and Guarantee 
Fund (EAGGF). Levels of support were 
relatively low (1 % of total funding), 
and there was close Commission 
supervision of the way TA funding was 
used.
07 
During the 2000–06 programming 
period, 10 central and eastern Europe ‑
an candidate countries3 were offered 
technical assistance in agriculture in 
the context of Sapard. This was one of 
three structural programmes (the oth ‑
ers being Phare and ISPA) addressing 
institutional, transport, environmental 
and agricultural capacity‑building to 
prepare administrations for EU mem ‑
bership. The three programmes had 
shared rules on TA implementation 
and eligibility. In the case of Sapard, 
the EU bore the entire amount of the 
TA expenditure incurred in each coun ‑
try at the Commission’s initiative, at an 
average rate of 3 % of annual funding.08 
From 2004, the eight Sapard countries 
which that year joined the EU were 
able to benefit from new transitory 
measures, including additional TA 
resources from the EAGGF ‘Guarantee’ 
section to help them strengthen the 
administrative capacity to manage 
their rural development programmes 
(s) efficiently.
09 
For the 2007–13 period — which is the 
main focus of this report — the link to 
structural spending was severed, and 
funding (including the TA component) 
in agriculture and rural development 
was addressed separately through 
legislation specific to the policy area. 
While this did not mean major rule 
changes for Pillar I, there were signifi ‑
cant developments in the approach 
towards the use of TA under Pillar II. 
The applicable legislation is described 
in the following section.
10 
One noteworthy element of TA pro ‑
gramming that was introduced for 
2007–13 was the requirement for 
networking in rural development, 
both nationally4 and across the EU5. 
Although it accounted for only a small 
part of the EAFRD allocation to TA, 
networking was an important addi ‑
tion because it established an EU‑wide 
framework involving a large number 
and variety of potential partners.3 All of the 2004 and 2007 
accession States except Cyprus 
and Malta.
4 Through ‘national rural 
networks’.
5 Through the European 
Network for Rural 
Development.
10 Introduction
Rules and regulations
11 
For 2007–13, the key references to TA 
in agriculture and rural development 
appeared in more than one EU regula ‑
tion6. Under Pillar I, co‑financing of 
Member States’ TA was only allowed 
for a few schemes7 which together ac ‑
counted for less than 5 % of the EAGF 
budget. In addition, Article 13 of the 
CAP financing regulation explicitly 
stated: ‘Expenditure relating to admin ‑
istrative and personnel costs incurred 
by Member States and beneficiaries of 
aid from the EAGF shall not be borne 
by the Fund’. In contrast with these 
restrictions, no maximum amount was 
specified for the Commission’s use of 
TA funding under Pillar I.
12 
In rural development, the rules auth ‑
orised the Commission to use up to 
0.25 % of the annual EAFRD allocation 
to fund TA activities. These were listed 
as ‘preparatory, monitoring, adminis ‑
trative support, evaluation and control 
measures’8. The Member States were 
given full charge of their own TA bud ‑
get, which was set at a maximum of 
4 % of the total amount for each RDP 
and was to be spent on ‘preparation, 
management, monitoring, evaluation, 
information and control activities of 
programme assistance’9. Within these 
limits, both the Commission and the 
Member States were free to determine 
how much to devote to TA and which 
projects/activities could be financed.13 
The Commission has not put forward 
any major changes to the principles 
of TA funding in the current program ‑
ming period (2014–20), either in rural 
development or in the general field of 
agriculture. Meanwhile, the planned 
volume of TA spending by both the 
Member States and the Commission is 
scheduled to increase (see Annex ).6 The main provisions for 
2007–13 were Article 5 of 
Council Regulation (EC) 
No 1290/2005 of 21 June 2005 
on the financing of the CAP 
(the CAP financing regulation) 
(OJ L 209, 11.8.2005, p. 1), 
Article 66 of Council 
Regulation (EC) No 1698/2005 
of 20 September 2005 on 
support for rural development 
by the EAFRD (the EAFRD 
Regulation) (OJ L 277, 
21.10.2005, p. 1) and Articles 40 
to 41a of Commission 
Regulation (EC) No 1974/2006 
of 15 December 2006 laying 
down detailed rules for the 
application of Council 
Regulation (EC) No 1698/2005 
on support for rural 
development by the EAFRD 
(the implementing regulation 
for EAFRD support) (OJ L 368, 
23.12.2006, p. 15). Like the 
2002 financial regulation 
(Council Regulation 
No 1605/2002), these texts 
have now been repealed and 
replaced.
7 Such as wine and beekeeping 
measures, the school fruit 
scheme and the POSEI scheme 
for outermost regions.
8 Article 66(1) of the EAFRD 
regulation.
9 Article 66(2) of the EAFRD 
regulation.
11 Introduction
Budgeting and spending 
levels
14 
In Title 05 of the EU budget (‘Agricul ‑
ture and rural development’), ap ‑
propriations for TA spending appear 
under both operational10 and adminis ‑
trative headings11.
15 
The table gives an overview of TA in 
agriculture and rural development dur ‑
ing the 2007–13 period.16 
At the end of the programming period, 
the Commission had not yet exhausted 
its TA commitments for Pillar I and 
Pillar II. The amount allocated under 
Pillar II was 0.19 % of the total EAFRD 
budget, significantly less than the per ‑
mitted ceiling, and by the end of 2013 
only around a quarter of this alloca ‑
tion had been spent. The situation was 
similar in the Member States, where 
the average amount planned for Pillar 
II was less than 1.9 % of the total rural 
development budget, while average 
execution was around 0.8 % at the end 
of 2013 — again, both significantly 
lower than the 4 % ceiling. However, 
because accounting can include costs 
incurred up to 2015 (the ‘n+2’ rule), 
final execution levels from all budgets 
may be much higher.10 Chapters 05 02 and 05 03 for 
specific schemes under Pillar I; 
chapter 05 04 for Pillar II. Some 
elements of TA spending are 
also included in chapter 05 08, 
which groups the general 
policy coordination activities 
of the CAP, i.e. those going 
beyond a specific programme 
area.
11 Article 05 01 04 (support 
expenditure). Although 
classified as administrative 
appropriations, costs of this 
nature are charged to the 
operational expenditure of the 
programme to which they 
contribute. The crucial point is 
that they must be clearly 
linked to either the EAGF or 
the EAFRD. Another part of 
chapter 05 01 (administrative) 
expenditure is also relevant to 
this audit. This concerns ‘Other 
management expenditure’ 
(item 05 01 02 11), a heading 
used to finance activities 
which, while very similar to 
operational TA, are not 
programme‑specific and 
therefore do not qualify under 
the regulations.
Overview of TA expenditure under Pillar I and Pillar IITable(million euro) 
Policy area Scheme Beneficiary Ceiling (%)TA budget planning 
(commitments)  
2007–13 Financial execution  
2007–13
Agriculture and rural 
developmentPillar ICOMM N/A 73.5 54.4
MS N/A No consolidated data available
Pillar IICOMM 240.6 (0.25  %) 188.0 47.9
MS 3 849.5 (4 %) 1 513.0 788.4
TOTAL ‘Agriculture and rural development’ 1 774.5 890.8
Note : All figures have been rounded.
Source:  ECA, on the basis of the EU general budget and data provided by the Commission.
12
 Audit scope, objectives  
and approach
Audit scope and 
objectives
17 
The Court examined the use of TA 
funds in agriculture and rural develop ‑
ment during the 2007–13 program ‑
ming period. The audit focused on the 
regularity, the effectiveness and the 
efficiency of funding at the Commis ‑
sion and in the Member States.
18 
The audit topic was chosen, in part, 
because of the diversity of TA (as 
a cross‑cutting area of spending), 
which appears under a number of 
budget headings (paragraph 14) and, 
finally, for which there was no sin ‑
gle clear definition in the applicable 
legislation.
19 
The audit aimed to assess how well TA 
was managed and whether it contrib ‑
uted to the core objectives of agricul ‑
ture and rural development policy. 
Specifically, we examined:
 ο what activities were financed from 
TA funding (see paragraphs 24 
to 51);
 ο whether the costs claimed for TA 
were eligible (paragraphs 52 to 59);
 ο whether the arrangements for 
measuring TA performance were 
appropriate and effective (para ‑
graphs 60 to 82).Audit approach
20 
The main audit work involved visits to 
the Commission’s Directorate‑General 
for Agriculture and Rural Development 
(DG Agriculture and Rural Develop ‑
ment) and to five Member States 
(Italy, Lithuania, Hungary, Austria and 
Poland) using TA funding in agricul ‑
ture and rural development. These 
countries were chosen because, taken 
together, they accounted for more 
than 50 % of TA spending during the 
audited period.
21 
Our findings are based on informa ‑
tion obtained from the audit visits and 
from a survey of regional and national 
managing authorities in the 27 Mem ‑
ber States. Of the 92 such authorities, 
50 replied to the survey, though not 
always in full or in much detail. All told, 
the survey and country visits produced 
information on approximately 76 % 
of all TA expenditure planned in rural 
development as at the end of 2013.
22 
In the five selected Member States, 
the auditors visited the main benefi ‑
ciaries of TA funding — ministries of 
agriculture, paying agencies and other 
bodies in charge of implementing rural 
development measures. They also 
held meetings with other stakehold ‑
ers, such as representatives of farmers’ 
associations, chambers of agriculture, 
non ‑governmental organisations 
(NGOs) and the other members of na ‑
tional rural networks. Lastly, the audi ‑
tors reviewed 20 DG Agriculture and 
Rural Development projects funded 
from the TA budget and 91 TA projects 
in the five Member States.
13 Audit scope, objectives and approach 
23 
Owing to the Article 13 prohibition 
on administrative spending under the 
EAGF (see paragraph 11) and the ab ‑
sence of consolidated data on the very 
few permitted cases of Pillar I TA, the 
audit in the Member States focused on 
rural development (Pillar II) spending. 
TA funding for EU candidate countries 
was excluded from the audit because 
of the minimal expenditure involved 
(just 0.3 million euro for the entire 
programming period).
14
 Observations
How is money for 
technical assistance 
actually spent?
24 
Before 2007, TA funding under the 
CAP was used essentially for capacity ‑
building activities, and administra ‑
tive costs in the Member States were 
explicitly excluded from all support12. 
At present, the scope of TA funding 
is sufficiently flexible to accommo ‑
date varied administrative capacity 
development needs. However, ensur ‑
ing flexibility should not mean losing 
sight of the traditional understanding 
of TA, or of how funding is to be used 
in practice. Furthermore, in order 
to ensure that TA funding provides 
added value, it should not replace the 
administrative expenditure that would 
anyway be incurred by national or EU 
administrations in their day‑to‑day 
management of public support 
schemes.
25 
Therefore, although the current rules 
do not universally prohibit TA fund ‑
ing for administrative costs, the Court 
considers that such use should be fully 
justified and transparent. It was in this 
light that we examined how money for 
TA has been disbursed and whether 
there is a clear common definition for 
use which ensures the added value of 
the supported activities.A problem of clarity
26 
In EU law, the only formal definition 
of TA appears in the context of public 
procurement from the general budget: 
‘[…] support and capacity‑building 
activities necessary for the implemen ‑
tation of a programme or an action, in 
particular preparatory, management, 
monitoring, evaluation, audit and 
control activities’13. Before 2013 there 
was no such definition anywhere in 
the financial regulation, and none in 
the regulations which formed the legal 
basis for the 2007–13 CAP.
27 
For the audited period, the notion 
of TA was itemised as part of ‘other 
financing’ of ‘the preparatory, moni ‑
toring, administrative and technical 
support, evaluation, audit and inspec ‑
tion measures required to implement 
the common agricultural policy, 
including rural development’ (Article 
5 of the CAP financing regulation)14. 
This list is notable for the omission of 
‘capacity‑building’. It recurs twice — 
each time slightly differently — in 
Article 66 of the EAFRD regulation in 
relation to TA funding in rural develop ‑
ment by, respectively, the Commission 
and the Member States (see paragraph 
12). There it is the non‑specific term 
‘administrative support’, or ‘manage ‑
ment’, which allows TA to be applied, 
if necessary, to administrative costs. 
Provided there is a programme link, 
the responsible authorities essentially 
have licence to use TA funding in any 
way they choose.12 Article 1(4) of Council 
Regulation (EC) No 1258/1999 
of 17 May 1999 on the 
financing of the CAP (OJ L 160, 
26.6.1999, p. 103) (fully 
repealed end 2006) stated: 
‘Expenditure relating to 
administrative costs and 
personnel borne by Member 
States and by recipients of aid 
[…] shall not be taken over [by 
the EAGGF]’.
13 Article 121(7) of Commission 
Delegated Regulation (EU) 
No 1268/2012 of 
29 October 2012 on the rules 
of application of Regulation 
(EU, Euratom) No 966/2012 of 
the European Parliament and 
of the Council on the financial 
rules applicable to the general 
budget of the Union (OJ L 362, 
31.12.2012, p. 1).
14 The wording used in Article 6 
of the ‘new’ CAP financing 
regulation (Regulation (EU) 
No 1306/2013 of the European 
Parliament and of the Council 
of 17 December 2013 on the 
financing, management and 
monitoring of the common 
agricultural policy and 
repealing Council Regulations 
(EEC) No 352/78, (EC) 
No 165/94, (EC) No 2799/98, 
(EC) No 814/2000, (EC) 
No 1290/2005 and (EC) 
No 485/2008 (OJ L 347, 
20.12.2013, p. 549)) is clearer 
but not substantially different.
15 Observations
28 
The absence of a clear and restric ‑
tive definition hinders the setting of 
targets and measurable objectives and 
thus reduces the degree of account ‑
ability. By blurring the distinction be ‑
tween operational and administrative 
costs, it is also damaging to budgetary 
transparency. Finally, greater freedom 
of choice has resulted in a lack of 
rigour about the goals of funding and 
how it can be used.
At the Commission, a shift 
towards administrative costs
29 
The regulations do not set an up ‑
per limit on the Commission’s use of 
TA funding under Pillar I. For Pillar 
II, the available amount is capped at 
0.25 % of the total EAFRD allocation 
and can be spent on a wide range of 
activities related to rural development 
operations, including ‘administrative 
support’. Beyond the requirement to 
establish a European Network for Rural 
Development (ENRD), the EAFRD regu ‑
lation does not more closely define 
those activities.30 
The Commission has largely refrained 
from going beyond the broad defini ‑
tions given in the CAP financing and 
EAFRD regulations and has not devel ‑
oped comprehensive guidelines as to 
the nature of operational TA activities. 
The only such parameters have been 
set in connection with public procure ‑
ment and with the funding of IT and 
audit expenditure. At the central level, 
the responsible Commission services 
have drawn up general rules (a ‘vade ‑
mecum’) for the financial management 
of CAP expenditure, but these do not 
clearly explain the distinction between 
Pillar I and Pillar II eligible TA expendi ‑
ture and general administrative costs.
31 
The largest share of the Commis ‑
sion’s internal TA allocation during 
2007–13 was spent on operational, or 
capacity‑building, activities (mainly 
under the headings of networking, 
external consultancy, evaluations and 
IT). In 2007, the total value of commit ‑
ments was 12.78 million euro, while 
the figure for 2013 was 71 % higher, or 
21.9 million euro. At the same time, the 
balance between different TA activity 
areas altered. The budgets for evalua ‑
tions and consultancy remained fairly 
stable in absolute terms, but far more 
was committed to IT and network ‑
ing. The relative shares taken by these 
spending categories in 2007  and  2013 
are shown in Figure 1 .
16 Observations Figure 1Charts comparing DG Agriculture and Rural Development use of TA in 2007  and  2013 
(commitments made)
Source:  ECA on the basis of detailed budget data from DG Agriculture and Rural Development.2007Evaluations and studies, 32 %
2013IT maintenance/development, 39 %Other, 2 %
External personnel and experts, 16 % Evaluations and studies, 15 %
Networking, 28 %IT maintenance/development, 28 %Other, 6 %
External personnel and experts, 18 %
Networking, 16 %
17 Observations
32 
Whereas the introduction and de ‑
velopment of IT systems for specific 
purposes can easily be qualified as 
TA linked to capacity‑building, it is 
harder to categorise regular IT main ‑
tenance costs in this way. This is 
because IT maintenance is a necessary 
management cost rather than a pro ‑
gramme‑specific tool, and as such it 
was previously financed exclusively 
from the administrative budget. Now, 
although the information available 
from the Commission does not permit 
a clear breakdown between IT mainte ‑
nance and IT development, there are 
clear indications of a trend towards 
greater TA financing of non‑operation ‑
al IT costs. This is discussed below.33 
In recent years, firstly, there has been 
a decline in the area of ‘Other man ‑
agement expenditure’ (administrative 
costs which are not programme‑spe ‑
cific and therefore cannot be financed 
from a TA budget line). The Commis ‑
sion, as a whole, steadily reduced its 
annual ‘other management’ commit ‑
ments from just under 180 million euro 
in 2007 to below 145 million euro in 
2013 — a cumulative fall of over 20 %. 
As shown in Figure 2 , the fall was even 
steeper in agriculture and rural devel ‑
opment. However, it was more than 
balanced over the same period by the 
increase in total TA expenditure (EAGF 
and EAFRD, operational and non‑oper ‑
ational), which went from near‑parity 
in 2007 to nearly three times as much 
as ‘other management’ expenditure by 
2013.Figure 2Inverse trend in DG Agriculture and Rural Development spending on technical 
assistance compared with ‘other management’ items
Source:  ECA, from figures in the 2007–13 general budgets.(million euro)
0510152025
2013 2012 2011 2010 2009 2008 2007Total other management
expenditure (budget item 05 01 02 20 11)Operational and non-operational
technical assistance expenditure
18 Observations
34 
Secondly, from 2014 the Commission 
decided to finance its IT system in 
agriculture and rural development 
entirely from the TA allocation, citing 
this goal of a ‘constant decrease in the 
usage of the administrative budget’15. 
As IT maintenance is generally non ‑
operational or not programme ‑spe ‑
cific, the decision amounts, in effect, 
to formal recognition that general 
administrative expenditure is eligible 
for TA spending.
35 
Assigning IT maintenance and other 
essential costs to budget headings 
which do not reflect their true nature 
blurs the distinction between what is 
administrative and what is operational, 
which has an adverse impact on bud ‑
getary discipline. At the Commission, 
it has reduced transparency about the 
nature and benefits of TA spending 
and contributed to false economies.
In the Member States, an 
emphasis on payroll
36 
In rural development, the TA funding 
made available before 2006, through 
Sapard and the EAGGF, focused on 
capacity‑building for national au ‑
thorities. The underlying principle 
of support was that establishing and 
developing domestic capacity would 
allow funding to be reduced over time. 
For 2007–13, however, overall funding 
rates were increased, Member States 
were given more control over their 
own TA spending and the rules were 
relaxed, making it possible to finance 
costs that had not previously been 
eligible, such as day‑to‑day administra ‑
tion and payroll. As a result, the money 
available was used very differently to 
the early 2000s.37 
Just as, internally, the Commission 
has made the most of a situation of 
great flexibility, where Member State 
spending is concerned, it has adopted 
a ‘hands‑off’ policy. By offering little or 
no detailed guidance in this regard, it 
has endorsed the Member States’ use 
of TA co‑financing for a wide range of 
non‑operational expenditure.
38 
Under Pillar II (the EAFRD), Member 
States are entitled to use up to 4 % 
of total programme funding to cover 
their TA needs. Certain Member States 
opted to budget for a significant pro ‑
portion of this maximum percentage 
for 2007–13. Denmark, Estonia, Latvia, 
Lithuania, Hungary and Malta set a rate 
at or near the maximum, and the rate 
also exceeded 3 % in Sweden. Details 
for all Member States are given in the 
Annex , which also shows that, for the 
2014–20 period, a majority of Member 
States have increased their allocation 
to TA, some of them by a substantial 
margin.15 DG Agriculture and Rural 
Development, 2013, 
Information technology 
master plan, p. 12.
19 Observations
39 
Figure 3  shows the budget planning 
of the Member States visited in the 
course of the audit for the three most 
common spending categories in RDPs, 
which correspond to the activities 
named in the EAFRD regulation16.
40 
The category ‘Preparation, manage ‑
ment, monitoring, evaluation and 
control’ is of particular interest. It 
includes many types of administrative 
expenditure, mainly payroll. And in the 
Member States, as at the Commission, 
there is a growing tendency, wherever 
legitimate, to take up the burden of 
an increasingly straitened staff and 
administrative budget from alternative 
sources.41 
Four of the five Member States explic ‑
itly reported administrative costs as 
making up the largest share of their 
actual spending on TA. In Lithuania, 
during 2007–13, this heading account ‑
ed for 51 % of total TA expenditure, 
in Poland and Hungary the corre ‑
sponding figure was over 60 %, and 
in Austria it was just below 95 %. In 
Italy, where many TA managing bodies 
are external public‑sector consult ‑
ants, administrative spending (which 
covers the costs of IT and technical 
and administrative support staff) was 
often included as part of the ‘capacity 
strengthening’ category. High levels 
of administrative spending thus occur 
across the board, even in Member 
States where the overall TA commit ‑
ment rate is comparatively low — the 
share of administrative costs is larger 
in Poland (where the TA funding rate 
was 1.49 %) than in Hungary (3.94 %).16 Articles 66(2) and 66(3).Figure 3Planned TA spending by five Member States for 2007–13 (EAFRD co‑financing)
1 No consolidated data available on information and publicity at MS level.
Source:  RDPs and data supplied by the Member States.National rural network
Information and publicity
Prepar ation, managemen t,
monit oring , evalua tion and
control
Austria1Hungary Italy1Lithuania Poland(million euro)250
200
150
100
50
0
20 Observations
42 
Figure 4  gives a summary of actual 
spending from the EAFRD in the five 
countries visited, plus other Member 
States which responded to the sur ‑
vey17. It shows the same three main 
groups of activities as in Figure 3 , 
but with the category ‘Preparation, 
management, monitoring, evalua ‑
tion and control’ broken down into 
two parts. This allows a more precise understanding of ‘administrative 
costs’, which here include staff pay and 
related charges, office overheads and 
other running costs, but exclude the 
costs of evaluations, training and IT. 
Similar costs may also occur as a com ‑
ponent of ‘Information and publicity’ 
and ‘National rural network’ expendi ‑
ture, in the second case up to a ceiling 
of 25 % of funding18.Figure 4TA spending in various Member States by category (2007–13, EAFRD co‑financing)
Note: The figures for Spain, Germany and Italy, which each have a system of regional RDPs, are extrapolated from the data provided by the regions 
which responded to the survey. Coverage was anyway considered to be sufficiently representative in each case (Spain 95 %, Germany 85 %, Italy 
77 %).
0 20 40 60 80 100 120 140 160 180 200Poland
Italy
Hungary
Romania
Spain
Germany
Austria
Portugal
Lithuania
Sweden
France
Greece
Bulgaria
Estonia
Denmark
Czech Republic
Netherlands
Ireland
Preparation, management, monitoring, evaluation and control activities: administrative costs
Preparation, management, monitoring, evaluation and control activities: streghthening capacity
Information and publicity
National rural network
Remainder of TA budget not yet spent(million euro)17 Bulgaria and Romania did not 
in fact reply to the survey, but 
the necessary information was 
available in these countries’ 
RDPs and in spending 
breakdowns provided by the 
Commission.
18 Article 41(2) of Regulation (EC) 
No 1974/2006.
21 Observations
43 
The results of the survey confirm what 
was found in the five audited Member 
States: when setting the eligibility 
criteria for TA funding, the competent 
authorities generally interpreted the 
regulatory provisions in a very flexible 
manner.
44 
This broad understanding of TA is by 
no means specific to agriculture and 
rural development but also occurs in 
other areas of EU funding. A recent 
report for the Commission19 on the 
financing of payroll from the Structural 
Funds concludes ‘… all Member States 
have used TA to co‑finance staff. More 
precisely, the majority of the Member 
States uses TA to co‑finance mainly 
salaries.’20
45 
At the start of the period, payroll 
already accounted for a large part of 
the TA funding used by Member States 
from the EAFRD and, in many cases, 
that share subsequently increased 
further. In Poland, for example, appro ‑
priations to management (mainly staff) 
costs rose sharply in 2013 by transfer 
from information and rural network ac ‑
tions. From mid ‑2009 Lithuania gradu ‑
ally included the salaries of staff only 
partly assigned to implementation 
of the RDP in the TA allocation, with 
the express objective of relieving the 
burden on the national budget. From 
no part‑time staff in 2008, by the end 
of 2012 almost 75 % of all staff funded 
in this way were also engaged on other 
tasks unrelated to the RDP . Where it 
is used to finance the payroll of staff 
already in post, TA effectively amounts 
to budget support. The problems this 
raises are considered below.The opportunity cost of TA 
funding
46 
Given the loose definition of TA and 
the costs associated with running 
the CAP funds (see Box 1),  it is hardly 
surprising that Member States, like the 
Commission, have increasingly com ‑
mitted their TA spending to adminis ‑
trative costs which are ancillary to rural 
development funding or fall within 
non‑operational budgets. The problem 
is that it is inherently difficult to gauge 
the value for money of such costs, or 
to demonstrate that using TA funding 
in this way contributes usefully and 
efficiently to the impact of the ‘larger 
envelope’ of rural development aid.
47 
The greater the share of overall EAFRD 
funding assigned by the Member 
States to TA activities, the less the 
money available for the core measures 
in rural development, where there 
is more immediate benefit to farm ‑
ers and rural communities. Where TA 
amounts to no more than budget sup ‑
port, that expense is, in effect, borne 
by final beneficiaries.19 Metis GmbH, Co‑financing 
salaries, bonuses, top‑ups from 
Structural Funds during the 
2007–13 period , Publications 
Office of the European Union, 
Luxembourg, 2014.
20 Ibid., p. 67.
22 Observations
48 
In one sense, given the variations in 
co‑financing rates, the risk is greater 
for the needier beneficiaries of EU 
funds. For 2007–13, the EAFRD con ‑
tribution ceiling was 50 % in Austria 
and northern Italy but 75 % in ‘Con ‑
vergence’ regions, which included 
Lithuania, Hungary and Poland. The 
prospect of a 3:1 contribution ratio can 
give Member States an additional in ‑
centive to spend, but some of the po ‑
tential advantage is lost if a significant 
percentage of co‑financing is diverted 
to non‑operational purposes.49 
Use of EU funds in this manner, though 
relatively minor in percentage terms, 
diverts substantial sums from the key 
objectives of funding. Allowing admin ‑
istrative costs under TA places both the 
Commission and the Member States 
in a position of conflict of interest. As 
managers of the CAP , they decide how 
much should be spent on different 
measures, including TA, with the aim 
of achieving the best value for money. 
At the same time, as beneficiaries of 
TA paid in respect of administrative 
expenditure, they have an incentive 
to maximise payments towards the 
necessary costs of programme man ‑
agement (see Box 1).
Technical assistance and the costs of programme management
Implementation of both the EAGF and the EAFRD entails a certain administrative outlay. At EU level, as well as 
setting up and managing the funds, the Commission was required to establish the ENRD, which is explicitly 
linked to TA spending.
In the Member States, the national and/or regional authorities were charged with implementing a panoply of 
measures which may necessitate new administrative arrangements. The basic legislation governing the CAP 
requires them to do everything in their power to protect the Union’s financial interests. To that end, com ‑
pulsory measures were specified in the EAFRD regulation under sections headed 'Management and control', 
'Information and publicity', and 'Monitoring and evaluation'. Together with the requirement for local devel ‑
opment strategies, local action groups and national rural development networks, those measures exposed 
Member States to substantial costs in connection with the delivery of aid, as illustrated hereunder.
In its activity report for 2013, DG Agriculture and Rural Development summarised the Member States’ report ‑
ing of their total spending on checks and controls of Pillar I and Pillar II certified payments21. Under Pillar I, the 
costs of control bodies (including payroll, training, maintenance and building expenses) accounted for ap ‑
proximately 5.13 % of total spending on EAGF measures. There is next to no TA provision for Member States 
under Pillar I, so this amount cannot benefit from any EU co‑financing. Under Pillar II, the corresponding figure 
calculated on the basis of the Member States’ reports was 8.13 %. In these circumstances, the incentive to 
recover the maximum amount under TA is strong, and has led certain Member States to set their budgets at or 
close to the 4 % ceiling.
21 http://ec.europa.eu/atwork/synthesis/aar/doc/agri_aar_2013.pdfBox 1
23 Observations
50 
In adding to Member States’ au ‑
tonomy, the current TA arrangements 
have thus strengthened their reliance 
on EU money, which is increasingly 
used in areas with no clear impact on 
strengthening and developing capa ‑
city. During the audit, the Polish and 
Lithuanian authorities expressed dis ‑
satisfaction with the imprecision in the 
rules, as well as an interest in receiving 
further guidance from the Commission 
on more efficient and effective ways of 
using TA.
51 
The current high allocation rate of TA 
funds to administrative costs looks set 
to endure through the 2014–20 period. 
Four of the five Member States visited 
explained that they still see TA essen ‑
tially as a tool with which to finance 
the basic implementation structure of 
their RDPs22. Moreover, TA now repre ‑
sents a greater overall proportion of 
total spending. As can be seen from 
the Annex,  although the aggregate 
rural development budget for all Mem ‑
ber States is smaller in the new period, 
the total amount earmarked for TA 
(1.9 billion euro) is 24 % higher.Are the costs eligible?
Some formal ineligibility at 
the Commission
52 
At the Commission, the Court exam ‑
ined 20 DG Agriculture and Rural De ‑
velopment projects from the audited 
period in all areas of TA. Four projects 
were found to contain irregulari ‑
ties, in each case because incorrect 
use was made of the EAGF non‑op ‑
erational budget. Three of the four 
(51 500 euro for the purchase of 40 
laptops, 10 000 euro for the purchase 
of software licences and 13 800 euro 
for a firewall maintenance contract) 
were exclusively assigned to the EAGF 
although they were also of benefit 
under Pillar II. Since non‑operational 
expenditure must be programme‑spe ‑
cific to qualify for TA funding, these 
costs should have been divided pro ‑
portionately between the EAGF and 
EAFRD budgets. The fourth item was 
a TA grant of 278 000 euro paid to the 
OECD, which was also included under 
the EAGF budget although previous 
payments under the same grant agree ‑
ment had been funded — correctly — 
from the general CAP coordination 
chapter.
53 
All procurement relating to the 20 
selected projects was free of any major 
non‑compliance issues. Procedures 
were correctly chosen and advertised 
and then implemented as statutorily 
required.22 The exception is Hungary, 
which has decided to limit its 
TA funding for 2014–20 to the 
operation of the national rural 
network and related activities, 
at a total rate of 2.4 %. All 
other rural development 
financing needs are to be met 
from the national budget.
24 Observations
More frequent problems in 
the Member States
54 
The audit revealed many cases of irreg ‑
ular funding from Pillar II TA in the five 
audited Member States. Of the 91 TA 
projects reviewed, ineligible or partly 
ineligible expenditure was found in 
35. The main problems relate either to 
the use of funding for activities shared 
by both pillars (and thus not eligible in 
full) or to issues with contracting and 
procurement. Some projects had both 
types of irregularity.
Some Member State activities 
not exclusive to Pillar II
55 
As already noted, Article 13 of the 
CAP financing regulation expressly 
prohibited any funding for adminis ‑
trative and staff costs in connection 
with the EAGF (Pillar I). In the Mem ‑
ber States, however, we found that 
25 of the audited projects included 
TA payments made under Pillar II for 
administrative costs actually incurred 
in connection with Pillar I or for activi ‑
ties otherwise unrelated to the EAFRD. 
The risk of this occurring is particularly 
high where purchases or projects are 
shared between Pillar I and Pillar II. In 
such cases, part of the expenditure is 
of course ineligible and should not be 
co‑financed.56 
The examples in Box 2  show that there 
is a risk of irregular expenditure be ‑
cause of deficiencies in record‑keep ‑
ing, the use of coefficients or other 
administrative procedures linked to 
what is an overly complex, and some ‑
what arbitrary, distinction between 
expenditure in two very similar areas 
of activity. All else being equal, it is 
unclear why administrative and staff 
costs should be disallowed under Pil ‑
lar I but not under Pillar II.
25 Observations
Risk of ineligibility where costs are shared with Pillar I
Most examples of cost‑sharing concerned the remuneration of staff handling both RDP and non‑RDP activi ‑
ties, especially where there was insufficient evidence to justify the proportion of pay charged to Pillar II. In 
Lithuania, it could not be shown that the coefficients used to assign costs to RDP duties were accurate, and 
therefore the eligibility of expenditure claims could not be verified. In Hungary, staff costs were meant to 
be eligible only in respect of officials assigned full time to activities specifically linked to the 2007–13 RDP . 
However, some staff handling TA were employed in departments with regular duties going beyond the RDP 
(ministerial secretariats, financial and legal units), but with no real assurance that they were engaged full time 
on RDP activities. Similar cases to these were found in Poland and Austria.
Another area of shared Pillar I and Pillar II costs is the purchase or maintenance of IT equipment or software. 
In Poland, the coefficient used to apportion IT maintenance spending to rural development activities at the 
paying agency was at least four years out of date. In Italy, it was not clear that video‑conferencing equipment 
purchased by the Ministry of Agriculture and charged solely to the EAFRD was exclusively for Pillar II use.
A final shared area concerns cross‑compliance checks23, where, if no clear distinction is made by type of 
support, it is possible for action taken under the EAGF to benefit from funding intended exclusively for the 
EAFRD. In Austria, the coefficient used to attribute cross‑compliance inspection costs to SPS claims (ineligible) 
as compared with agri‑environment claims under rural development (eligible) was not updated each year. In 
2011 this initially resulted in an overpayment of 15 600 euro from the EAFRD.
23 ‘Cross‑compliance’ is the requirement that farmers receiving direct payments under Pillar I should meet basic environmental, food safety, animal 
and plant health and animal welfare standards. It also applies to most Pillar II environmental payments.Box 2
26 Observations
Procurement irregularities
57 
The audit revealed many problems 
with contracting and procurement 
practices in the Member States (af ‑
fecting 17 of 51 audited procurement 
procedures, mainly in the area of 
information and publicity activities). 
The issues that arose included the use 
of direct negotiation rather than com ‑
petitive tendering to award contracts, 
in contravention of the provisions on 
transparency, equal treatment and 
non‑discrimination in the Procure ‑
ment Directive24 and, in some cases, 
the relevant national rules. Use of the 
wrong procedure not only breaches 
EU and/or national law; it also subverts 
the open market rules, discriminates 
against other potential contractors 
and may result in overspending.24 Directive 2004/18/EC of the 
European Parliament and of 
the Council of 31 March 2004 
on the coordination of 
procedures for the award of 
public works contracts, public 
supply contracts and public 
service contracts (OJ L 134, 
30.4.2004, p. 114).
Examples of procurement irregularities
Use of the wrong procedure
In Italy, two travel agency services (worth 170 000 and 130 000 euro respectively) were purchased by direct 
negotiation, in contravention of the national rules stating that contracts exceeding 40 000 euro must be open 
to competition.
In Poland, direct negotiation was used without justification to conclude contracts with a subordinate gov ‑
ernment department (hotel, catering, conference and training services) and with a previous contractor (IT 
services delivered to a government agency).
Overpricing of contracts
In Hungary, a complex framework contract with an events organiser was awarded in 2008 on the basis of unit 
prices which would still have been too high even six years later. The overpriced contract was subsequently 
terminated two years early.
Tender specifications an obstacle to transparency and equal treatment
In Italy, the audit revealed multiple instances of public calls for tender with limited or imprecise information 
concerning the technical criteria which would be taken into account when an award was made. This made it 
difficult for competent but inexperienced tenderers to formulate their bids correctly, and it also complicated 
the task of assessing the relative merits of bids and justifying the final award decision.Box 3
27 Observations
25 Article 62 of Commission 
Implementing Regulation (EU) 
No 809/2014 of 17 July 2014 
laying down rules for the 
application of Regulation (EU) 
No 1306/2013 of the European 
Parliament and of the Council 
with regard to the integrated 
administration and control 
system, rural development 
measures and cross 
compliance (OJ L 227, 
31.7.2014, p. 69) expressly 
places Member States’ TA 
expenditure under the 
general requirement for 
administrative and 
on‑the‑spot checks and 
reporting. It also emphasises 
independence by stipulating 
that control bodies must be 
‘functionally independent’ 
from the bodies authorising 
payment.
26 ‘Specific, measurable, 
achievable, relevant and 
timed’.
27 The principles and rules in this 
paragraph are covered by 
Article 27 of the 2002 financial 
regulation.
28 See Article 53b of the 2002 
financial regulation.Control systems poorly applied
58 
Notwithstanding the comments in 
paragraph 56, we found that the 
Member States’ systems of controls to 
determine whether costs were cor ‑
rectly assigned to Pillar II did not func ‑
tion properly. In many cases where the 
Member States had specified coeffi ‑
cients or other calculations to estab ‑
lish the division of costs between the 
EAGF and EAFRD, the formulae were 
not systematically applied or were 
updated on an irregular basis, yet no 
checks had identified these failings for 
correction. In this regard it is encour ‑
aging to note that, since the audit, the 
Commission has reinforced the rules 
governing Member States’ checks of 
TA expenditure25.
59 
In much the same way, the vast major ‑
ity of projects in which we identified 
procurement irregularities had already 
been subject to administrative checks 
by the relevant national authorities. 
Inasmuch as these checks had not 
identified the shortcomings detected 
by the ECA, they were revealed to be 
ineffective. Once again, in response to 
the need for action to improve the effi ‑
ciency of Member States’ management 
and control systems for TA, the Com ‑
mission has already reported that it is 
drafting guidance on public procure ‑
ment for the 2014–20 period.How suitable is the 
performance framework 
for TA?
60 
The preamble to the financial regula ‑
tion establishes economy, efficiency 
and effectiveness as the core princi ‑
ples of sound financial management 
in all areas of budget spending. To 
safeguard these principles, SMART26 
objectives must be set for each sector 
of activity and monitored by means of 
performance indicators, leading to an ‑
nual ‘activity statements’. The institu ‑
tions (in this case the Commission) are 
required, finally, to make ex ante and  
ex post evaluations.27
61  
In the context of shared management, 
the above tasks are delegated to the 
Member States, which are responsible 
for ensuring that funds are used in ac ‑
cordance with the applicable rules and 
principles.28
62 
The use of all CAP funding is therefore 
tightly regulated by requirements 
relating to guarantees on the ap ‑
propriateness of expenditure. The 
audit revealed that the implementing 
authorities frequently exclude TA from 
the scope of these rules. However, as 
explained in Box 4,  the obligations 
in the financial regulation are equally 
valid for TA as an activity in the ‘Agri ‑
culture and rural development’ policy 
area.
28 Observations
63 
Although TA is a small part of global 
spending, it represents a significant 
amount of money over the program ‑
ming period and needs to be duly 
accounted for. Despite assurances 
from the Commission and the Mem ‑
ber States that their TA spending on 
non‑operational costs is both nec ‑
essary and proportionate, and that 
it makes a valuable contribution to 
programme success, by and large, 
no performance framework exists to 
demonstrate that this is the case. The 
field is characterised by inadequate 
multiannual planning, no proper needs 
assessment, imprecise objectives (thus 
not SMART), and no performance‑ori ‑
ented monitoring and evaluation of TA 
programmes (instead financial aspects 
are given the greatest weight).Is TA an activity or just a tool?
The audit generally found that the responsible authorities consider TA, as a source of administrative support 
for essential funding operations, to be exempt from the regulatory requirements on performance. For Austria, 
TA is purely and simply a tool for implementing the RDP , and the only yardstick for its effectiveness is pro ‑
gramme success. In this view, TA cannot be planned and cannot be assigned objectives or indicators, which 
more properly belong to the core measures29 to which it contributes. For the Commission, presenting TA as 
a separate consolidated activity in its own right would make it difficult to assess the input made in each rural 
development activity area.
This reasoning, which casts TA funding as somehow passive and not part of the operational performance 
framework, is contradicted by the regulations. Article 66 of the EAFRD regulation calls TA both an ‘activity’ and 
a ‘measure’, and Article 2(d) defines ‘measure’ as ‘a set of operations contributing to the implementation of an 
axis’. Moreover, given the volume of funds committed to TA spending, particularly in the Member States (over 
1.5 billion euro), it is essential to have clarity that it is soundly managed and contributing to programme im ‑
plementation. This can best be achieved by correctly planning, monitoring and evaluating its specific impacts.
29 As described in Title IV, chapter I, of the EAFRD regulation. TA is dealt with in Title IV, chapter II.Box 4
29 Observations
Poor planning and 
assessment of needs
64 
So that objectives can be developed 
and targets set appropriately, it is 
important to perform an initial needs 
assessment and plan for the medium 
and long term. This is, moreover, part 
of the ex ante  evaluation procedure 
laid down in the EAFRD regulation30.
65 
At the Commission, one upshot of the 
perception of TA spending as admin ‑
istrative support is that it is largely 
considered to be annual expenditure. 
In almost all activity areas (with the 
exception of studies and evaluations 
and the ENRD), there was neither an 
initial needs assessment for the period 
nor multiannual planning of the use of 
funds. This meant, in some cases, that 
budget allocations were renewed from 
one year to the next without confirma ‑
tion whether the (short‑term) need 
expressed some years previously was 
still valid. Moreover, without a proper 
needs assessment, implementation 
can become random and unfocused.
66 
The EAFRD regulation required Mem ‑
ber States to undertake an ex ante eval ‑
uation of their RDPs so as to ‘identify 
and appraise medium and long‑term 
needs, the goals to be achieved, the 
results expected, the quantified tar ‑
gets particularly in terms of impact in 
relation to the baseline situation, the 
Community value‑added, the extent to 
which the Community’s priorities have 
been taken into account, the lessons 
drawn from previous programming 
and the quality of the procedures for 
implementation, monitoring, evalua ‑
tion and financial management.'3167 
Just like the Commission, the five 
Member States generally omitted TA 
from their multiannual rural develop ‑
ment needs assessment. The main 
consequence of this policy came in the 
form of unstable TA budgets subject 
to change by administrative decree. 
Even in Poland, which did produce 
a TA needs assessment for one com ‑
ponent of its RDP , the initial budget 
was significantly underestimated. In 
keeping with its hands‑off approach 
to Member State spending under this 
heading, the Commission accepted the 
necessary programme amendments 
without reservation.30 Article 85.
31 Article 85.
30 Observations
Objectives far from SMART
68 
The purpose of SMART objectives is to 
target funding more precisely and thus 
achieve specific ends more efficiently. 
Objectives that are SMART also provide 
a clearer framework for monitoring 
and the evaluation of results.
69 
Because of its inadequate planning 
and needs assessment, the Com ‑
mission generally failed to develop 
SMART objectives for TA funding. TA 
does not appear in DG Agriculture and 
Rural Development’s detailed annual 
management plans summarising the 
department’s objectives and indicators 
for the coming year  — even though 
the projects and actions supported by 
TA funding are included in those plans. 
Nor do the operational financing deci ‑
sions prepared by the DG have SMART 
objectives or indicators for TA projects, 
which are treated in the same way as 
the Commission’s general administra ‑
tive expenditure. The only exception 
is the area of evaluations and studies, 
which, as already noted, benefit from 
multiannual planning and have SMART 
objectives which are built into the 
requirements of the relevant specific 
regulations.70 
In the Member States, little was done 
to develop specific TA objectives. The 
lack of multiannual planning in dis ‑
crete areas of TA activity (e.g. national 
rural network information and commu ‑
nication measures) hindered transpar ‑
ency and the definition of objectives. 
Nor did it help that there was no clear 
distinction between individual TA 
activity areas, or between them and 
other similar activities unrelated to the 
aims of the EAFRD. Of the five Member 
States visited, only Italy went beyond 
the general scope of the regulations. 
However, even in Italy the objectives 
were unquantified and lacked a time 
horizon.
Examples of inadequately‑worded objectives from the programming documents of 
Member States
The Lithuanian objectives included the following: ‘to ensure appropriate preparation, efficient implementa ‑
tion and evaluation of the programme […] to ensure the appropriate presentation of and publicity for infor ‑
mation […] to ensure accessibility of information’.
The Polish objectives were essentially limited to a recital of the activities covered by Articles 66 and 68 of the 
EAFRD regulation. Thus, although in line with the regulatory requirements, they did not specify the antici ‑
pated results or impacts of TA, or address how TA performance is to be measured.Box 5
31 Observations
Limited monitoring and 
evaluation
71 
The financial regulation makes cer ‑
tain stipulations for the Commission’s 
monitoring and evaluation activities. 
Essentially, annual reports are to be is ‑
sued to the budgetary authority on the 
achievement of objectives assessed 
against performance indicators32.
72 
In rural development33, the key points 
for 2007–13 included the requirement 
for a common monitoring and evalu ‑
ation framework (CMEF) between the 
Commission and the Member States, 
with a limited number of indicators 
common to all RDPs. Each Member 
State was also expected to set addi ‑
tional indicators allowing the progress, 
efficiency and effectiveness of its RDP 
to be measured at all stages of imple ‑
mentation. There was to be an annual 
progress report to the Commission, 
and also ex ante , mid‑term and ex post  
evaluations of programme quality, ef ‑
ficiency and effectiveness.
73 
The CMEF was established as required. 
In line, however, with the view that 
TA is not subject to performance 
requirements, it was not mentioned 
in general guidance on the CMEF and 
was also absent from the description 
of measures and common indicators.74 
At the Commission, therefore, the 
monitoring and evaluation of TA fund ‑
ing are just as limited as the planning 
of TA. There are no criteria making 
the link to overall programme perfor ‑
mance, but there is an overwhelming 
focus on financial and other purely 
administrative aspects, such as respect 
for expenditure ceilings and contract 
execution deadlines.
75 
The situation is very similar in the 
Member States, again because TA does 
not appear in the CMEF. The Commis ‑
sion’s monitoring of Member States’ 
RDPs is limited to checks of budgetary 
implementation and compliance with 
the 4 % ceiling. The Member States’ 
own principal monitoring tool is the 
annual progress report each produces 
on its RDP , but the annual progress 
reports on three of the six RDPs exam ‑
ined contained no evaluation of TA. 
Where such an evaluation was given, 
moreover, the lack of performance and 
impact indicators or clear guidelines 
for presentation limited the scope of 
monitoring to the financial execution.32 Article 27(3) of the 2002 
financial regulation.
33 Articles 77 to 87 of the EAFRD 
regulation.
32 Observations
The impact of an inadequate 
performance framework
76 
It is for the Commission, as the body 
responsible for the execution of the EU 
budget, to guarantee sound financial 
management of the EAFRD. This task 
includes offering strong guidance on 
the efficient and effective use of TA. 
However, by not defining its own TA 
needs as part of a performance frame ‑
work, and by not insisting that the 
Member States do likewise, the Com ‑
mission has deprived itself of a tool 
for assessing the global impact of TA 
spending and thus targeting funding 
where it will be most beneficial.
77 
A performance framework would also 
be useful as a basis for proposing TA 
solutions to specific problems that 
might arise with the EAFRD. When, in 
2011 and 2012, the Commission invited 
all Member States to develop action 
plans for reducing the unacceptable 
error rate in rural development, an 
opportunity was lost to identify TA as 
a means of facilitating or supporting 
remedial action.78 
To the extent that the elements of 
planning, monitoring and evaluation 
required by the financial regulation 
are in place at the Commission and in 
Member States, they cover operational 
activities rather than the administra ‑
tive expenditure which now accounts 
for the largest share of TA budgets. 
One key reason is that it is very dif ‑
ficult to plan and assess the contribu ‑
tion of payroll, for example, to overall 
programme performance. This type 
of spending is far less compatible 
than operational expenditure with 
the need to demonstrate compliance 
with the principles of sound financial 
management.
Networking: potential for 
an effective performance 
framework
79 
The ENRD34 is the only component of 
TA at the Commission to be explicitly 
defined in the EU’s agriculture and 
rural development legislation. The 
ENRD has clear aims linked to the con ‑
solidation and strengthening of rural 
development practices and capacity 
throughout the Union.
80 
One of the ENRD’s tasks is to support 
national rural networks (NRNs) in the 
Member States, which are also funded 
from TA35. An absolute ceiling of 25 % 
of each NRN’s allocation was estab ‑
lished for the necessary administrative 
structures36, with the remainder to be 
spent on an action plan containing 
specified information and capaci ‑
ty‑strengthening activities37.34 Established in accordance 
with Article 67 of the EAFRD 
regulation.
35 Under Article 68 of the EAFRD 
regulation.
36 Article 41(2) of Regulation (EC) 
No 1974/2006.
37 ‘[…] at least the identification 
and analysis of good 
transferable practices and the 
provision of information about 
them, network management, 
the organisation of exchanges 
of experience and know‑how, 
the preparation of training 
programmes for local action 
groups in the process of 
formation and technical 
assistance for inter‑territorial 
and transnational 
cooperation.’
33 Observations
81 
In the case of both the ENRD and the 
national networks, therefore, the legi ‑
slation set more precise guidelines as 
to the uses of TA funding, with a clear 
distinction between what is opera ‑
tional and what is not. Most network 
spending is theoretically compatible 
with a performance framework, which 
should make it easier to ensure the co ‑
herence of TA activities in this area and 
should facilitate evaluation and verifi ‑
cation in line with the general princi ‑
ples of sound financial management.82 
However, network activities were 
often characterised by the same 
incomplete planning, monitoring and 
evaluation as TA in rural development 
as a whole. Generally speaking, their 
impact is hard to assess — although an 
exception can be made for the Ital ‑
ian NRN (see Box 6),  which is in some 
respects a model for TA planning and 
operation.
The Italian NRN38 as an example of a functioning performance framework
The audit found that the Italian NRN has largely achieved its global operational objectives (improved govern ‑
ance, managerial and administrative capacity‑building, the sharing of knowledge and good practices), and 
that it has offered effective coordination and support for Italy’s regional RDPs (through data collation and 
consultancy) while also promoting transnational cooperation. The NRN has a popular website and organises 
a varied range of initiatives and events. Its communication activities are very broad‑based (including a web 
community for young farmers and school projects). To identify and promote good practices, video competi ‑
tions have been organised for young farmers, and the winners’ work has been uploaded to the NRN website.
The NRN’s achievements and success with its stakeholders are due in part to detailed planning of operational 
outputs. The NRN is then monitored and evaluated against a range of indicators accompanied by target val ‑
ues. A set of output indicators (e.g. meetings held, guidelines published) relate to specific programme actions, 
while result indicators (customer satisfaction rates, dissemination of good practices) and impact indicators 
(number of key players involved in governance, public perception of the visibility of RD policies) have been 
established for the NRN as a whole.
Finally, the NRN programme takes account of the ex ante and ongoing evaluations of TA funding. All the 
recommendations made in 2010 by the independent mid‑term evaluator concerning the need for an indica ‑
tor framework common to all TA actions were taken up by the Italian authorities with a view to improving the 
quality of monitoring.
38 Italy is one of a handful of Member States with a system of regional RDPs. What this means is that the NRN doubles as a coordination and support 
body for the regions in all areas of rural development policy, not just as a TA measure. It is therefore subject, as if it were a national RDP, to the 
requirements of the CMEF.Box 6
34
 Conclusions and 
recommendations
83 
Overall, the Court concludes that ow ‑
ing to the absence of a suitable perfor ‑
mance framework for TA expenditure 
in agriculture and rural development, 
neither the Commission nor the Mem ‑
ber States are able to demonstrate 
how well TA has contributed to the 
general policy objectives of the CAP .
84 
Despite the significant amounts in ‑
volved, the legislative framework does 
not clearly define TA, and the rules are 
vague about how it can be used. The 
audit showed that the Commission 
and the Member States have taken full 
advantage of this situation. However, 
the freedom of choice has resulted in 
a lack of rigour (paragraph 28). The 
Commission has not developed com ‑
prehensive guidelines on TA funding, 
either internally or for the Member 
States (paragraphs 30  and  37).
85 
At the Commission, the distinction 
between operational expenditure 
and general administrative costs 
has become blurred. Spending on IT 
maintenance in particular is an increas ‑
ingly prominent part of the TA budget 
(paragraphs 32 to 35). Meanwhile, four 
of the five audited Member States re ‑
ported administrative costs as making 
up the largest share of their spending 
on TA, with an emphasis on payroll. In 
situations where the staff concerned 
would be required in any case to 
implement policy, this use of TA ef ‑
fectively amounts to budget support. 
It is now standard practice in many EU 
policy areas to fund payroll from TA 
(paragraphs 39 to 45).86 
The absence of a clear distinction be ‑
tween operational and administrative 
costs, and the lack of clarity as to the 
nature of activities that TA is supposed 
to cover, reduce budgetary transpar ‑
ency and hinder scrutiny of how budg ‑
ets are spent (paragraphs 26 to 28).
87 
The audit revealed some formal ineli ‑
gibility at the Commission, owing to 
the incorrect assignment of costs to 
budget (paragraph 52). In the Member 
States, the main problems relate either 
to the use of funding for activities 
shared by both pillars (and thus not eli ‑
gible in full) or to issues with contract ‑
ing and procurement (paragraphs 54 
to 59). Nonetheless, the Court con ‑
cludes that most TA expenditure meets 
the flexible eligibility criteria currently 
in force.
88 
The Court found that, in practice, 
administrative costs such as payroll or 
IT frequently relate to both pillars of 
the CAP . The fact, therefore, that they 
are eligible under Pillar II only (in the 
Member States) or, proportionately, 
under both Pillar I and Pillar II (at the 
Commission) creates a need for bur ‑
densome procedures to justify the way 
costs are allocated (paragraphs 52, 54 
to 56).
35 Conclusions and recommendations
89 
Moreover, it is inherently difficult to 
gauge value for money in the context 
of administrative costs. Thus, although 
the absorption of such costs by TA is 
likely to contribute in some ways to 
achievement of the policy objectives 
of the CAP , it is virtually impossible 
to make a reliable assessment of this 
contribution and, in particular, to dem ‑
onstrate that this form of TA spending 
represents better value for money 
than direct spending on the core CAP 
measures (paragraphs 46 to 48).
90 
Additionally, allowing administrative 
costs under TA puts both the Commis ‑
sion and the Member States in a posi ‑
tion of conflict of interest. As mana ‑
gers of the CAP , they decide how much 
should be spent on different measures, 
including TA, with the aim of achieving 
the best value for money. At the same 
time, as beneficiaries of TA paid in 
respect of administrative expenditure, 
they have an incentive to maximise 
payments towards the necessary costs 
of programme management (para ‑
graph 49).
Recommendation 1
The Commission should clarify the 
scope and application of TA. In par ‑
ticular, it should clarify the distinc ‑
tion between operational/‘capacity ‑
building’ expenditure and eligible 
administrative/‘budget support’ costs, 
notably in the case of payroll.
Such clarification would improve 
transparency about the ways funding 
can be used. The Commission should 
closely monitor the Member States’ 
implementation of TA.Recommendation 2
The Commission should also take 
appropriate measures to ensure that 
general administrative expenditure 
such as regular IT maintenance is not 
charged to TA budget lines.
Recommendation 3
The Commission should, in future, 
require Member States to report 
administrative/‘budget support’ costs 
for rural development separately so as 
to make it more transparent that part 
of TA funding is spent on such support.
91 
The Court found that neither the Com ‑
mission nor the Member States have 
established a suitable performance 
framework to demonstrate the neces ‑
sity and effectiveness of TA funding. 
The imprecision with which TA was 
cast in the regulations for 2007–13 al ‑
lowed managing authorities to exclude 
it from this essential aspect of sound 
financial management. Because the 
bulk of TA spending is not operational, 
it is largely considered to be annual 
expenditure and did not appear in the 
common monitoring and evaluation 
framework. As a result, it is character ‑
ised by inadequate multiannual plan ‑
ning and lacks a proper needs assess ‑
ment, leading to imprecise objectives 
and no performance‑oriented moni ‑
toring and evaluation (paragraphs 60 
to 75).
36 Conclusions and recommendations
92 
By not defining its own TA needs as 
part of a performance framework, 
and by not insisting that the Member 
States do likewise, the Commission 
has deprived itself of a tool for asses ‑
sing the global impact of TA spending 
and targeting funding where it will be 
most beneficial. The potential effec ‑
tiveness of TA funding is thus severely 
compromised (paragraphs 76 to 78).
93 
The Court found that the arrange ‑
ments for networking afforded greater 
compatibility with the elements of 
a performance framework, through 
more precise guidelines as to the uses 
of TA funding and a clear distinction 
between what is operational and what 
is not, together with a ceiling on man ‑
agement spending by the Member 
States (paragraphs 79 to 82).Recommendation 4
The Commission and the Member 
States should establish a suitable 
performance framework for TA fund ‑
ing. In particular, the TA needs of the 
Commission and of the Member States 
should be properly assessed and there 
should be a mechanism in place to 
set objectives and measure progress 
towards them, which would in turn 
enhance accountability and make it 
possible to improve the effectiveness 
and efficiency of spending.
This Report was adopted by Chamber I, headed by Mrs Rasa BUDBERGYTĖ, 
Member of the Court of Auditors, in Luxembourg at its meeting of 11 March 2015.
 For the Court of Auditors
 Vítor Manuel da SILVA CALDEIRA
 President

37
 Annex AnnexFinancial planning of TA in rural development for 2007–13  and  2014–20 based on DG 
Agriculture and Rural Development data
Member State2007-2013 2014–20Changes 
2007–13  to 2014–20 
(2007–13 = 100 %)
Financial plan: 
rural 
development  
(in euro)Financial 
plan: TA  
(in euro)TA as 
share of 
RDFinancial plan: 
rural 
development  
(in euro)Financial 
plan: TA  
(in euro)TA as 
share of 
RDChange 
in RD 
planningChange 
in TA 
planning
Belgium1487 484 306 5 653 734 1.16  % 647 797 759 7 614 324 1.18  % 132.89  % 134.68  %
Bulgaria12 642 248 596 39 545 031 1.50  % 2 338 783 966 54 500 000 2.33  % 88.51  % 137. 82  %
Czech Republic12 857 506 354 13 514 430 0.47  % 2 281 445 107 22 500 000 0.99  % 79.84  % 166.49  %
Denmark2577 918 796 23 100 024 4.00  % 629 400 690 25 175 839 4.00  % 108.91  % 108.99  %
Germany19 078 378 263 92 685 319 1.02  % 8 768 178 051 199 667 445 2.28  % 96.58 % 215.43  %
Estonia 723 736 855 28 586 354 3.95  % 823 341 558 28 083 108 3.41  % 113.76  % 98.24  %
Ireland12 494 540 590 2 160 000 0.09  % 2 190 000 000 3 180 000 0.15  % 87.79  % 147. 2 2  %
Greece13 906 228 424 45 000 000 1.15  % 4 223 960 793 79 723 255 1.89  % 108.13  % 17 7.16  %
Spain18 049 474 764 101 591 356 1.26  % 8 214 328 821 118 952 677 1.45  % 102.05  % 117.0 9  %
France17 584 497 109 49 972 316 0.66  % 11 353 567 383 127 974 320 1.13  % 149.69  % 256.09 %
Italy18 985 781 883 191 256 136 2.13  % 10 384 714 084 260 147 585 2.51  % 115.57  % 136.02  %
Cyprus1164 563 574 2 913 089 1.77  % 132 214 377 2 381 377 1.80  % 80.34  % 81.75  %
Latvia 1 054 373 504 41 644 500 3.95  % 1 074 576 782 42 983 070 4.00  % 101.92  % 103.21  %
Lithuania 1 765 794 093 67 996 680 3.85  % 1 613 088 240 57 323 530 3.55  % 91.35  % 84.30  %
Luxembourg194 957 826  -  0.00  % 100 574 600 1 058 045 1.05  % 105.92  % N/A
Hungary13 860 091 392 152 233 735 3.94  % 3 430 667 653 74 055 333 2.16  % 88.88  % 48.65  %
Malta177 653 355 3 063 355 3.94  % 97 326 898 3 893 076 4.00  % 125.34  % 127.0 9  %
Netherlands1593 197 167 3 251 167 0.55  % 607 305 360 21 695 360 3.57  % 102.38  % 6 67. 31  %
Austria 4 025 575 992 87 807 211 2.18  % 3 937 551 997 114 181 478 2.90  % 97. 81  % 130.04  %
Poland213 398 928 156 199 950 000 1.49  % 8 598 280 814 132 527 195 1.54  % 64.17  % 66.28  %
Portugal14 056 570 600 86 483 763 2.13  % 4 057 788 354 77 095 212 1.90  % 100.03  % 89.14  %
Romania18 124 198 745 100 895 834 1.24  % 8 015 663 402 178 367 919 2.23  % 98.66  % 176.78  %
Slovenia 915 992 729 12 922 668 1.41  % 837 849 803 24 946 000 2.98  % 91.47  % 193.04  %
Slovakia21 996 908 078 42 238 362 2.12  % 1 545 272 844 59 291 790 3.84  % 7 7. 38  % 140.37  %
Finland12 155 018 907 23 082 183 1.07  % 2 380 408 388 29 874 500 1.26  % 110.46  % 129.43  %
Sweden11 953 061 954 64 188 151 3.29  % 1 763 315 250 63 410 453 3.60  % 90.28  % 98.79  %
United Kingdom14 612 120 420 31 294 724 0.68  % 5 190 459 683 67 171 685 1.29  % 112.54  % 214.64  %
Total/average 
share by MS3 96 236 802 432  1 513 030 122 1.57  % 95 237 862 657  1 877 774 575 1.97  % 98.96  % 124.11  %
1 For the 2014–20 period, RDPs not yet or only partially approved by the Commission (as at the end of February 2015).
2 For the 2014–20 period, flexibility (Pillar I transfers) not yet included.
3  Excluding Croatia, which joined the EU in 2013 so had no EAFRD expenditure for 2007–13; for 2014–20 its planned EAFRD budget is 2 026 mil ‑
lion euro, including 55 million euro TA.
38
VI
Member States have the obligation to provide infor ‑
mation in the annual progress report on the quality 
and effectiveness of the programme implementa ‑
tion, including the use of TA (Annex VII, Regulation 
(EC) No 1974/2006).
TA expenditure contributes to a smooth implemen ‑
tation of the programmes, which ultimately ben ‑
efits beneficiaries. 
VII
TA contributes to the implementation, monitor ‑
ing, control and evaluation of the RDPs. Only the 
synthesis of ex post evaluations of the RDPs will be 
able to demonstrate the contribution of TA to the 
general CAP objectives.
The legislator decided to grant flexibility to Mem ‑
ber States in the use of TA funds. 
VII First recommendation
The Commission accepts this recommendation and 
will further develop guidance in this regard. 
VII Second recommendation
The Commission cannot accept this recom ‑
mendation. It considers that IT maintenance is 
an operational activity linked to the update and 
development of the systems. In accordance with 
the Commission’s ESIF budgetary guidelines, dated 
16 May 2014, for the shared management pro ‑
grammes on the use of the operational and the 
non ‑operational (administrative) TA in the case of IT 
and audit expenditure, all types of IT costs, whether 
related to IT development or IT maintenance, 
should always be charged in the same budget 
line as their respective IT development costs. This 
approach strengthens the budgetary discipline and 
consistency in all shared management areas of the 
Commission’s budget. 
VII Third recommendation
The Commission accepts this recommendation.Executive summary
IV
The Commission considers that Article 5 of Regula ‑
tion (EC) No 1290/2005 provides the single clear 
legal reference for both EAGF and EAFRD at Com ‑
mission level and/or on its behalf.
For the new programming period, technical assis ‑
tance (TA) at the level of the Member States is 
defined under Article 59 of Regulation 1303/2013.
The freedom of choice resulting from the regulatory 
flexibility is needed to cope with the large variety 
of needs encountered by national and regional 
authorities. Capacity ‑building is very much linked 
to certain types of costs such as administrative 
costs or IT tools. Expenditure financed through TA is 
directly linked to the preparation, implementation 
and evaluation of the rural development pro ‑
grammes (RDPs).
As regards the 2014–20 programming period, 
the Commission has presented comprehensive 
guidelines to the Member States and provided 
policy lines to desk officers in order to streamline 
approaches in the negotiation of new RDPs.
V
Member States must ensure that all the rural 
development measures they intend to implement 
are verifiable and controllable. To this end Member 
States shall define control arrangements that give 
them reasonable assurance that eligibility criteria 
and other commitments are respected (Article 48, 
Regulation (EC) No 1974/2006). 
For the 2014–20 programming period, TA will be 
subject to administrative and on ‑the ‑spot checks 
(Article 62, Regulation (EC) No 809/2014) improving 
the level of assurance in `terms of eligibility of the 
expenditure. 
TA expenditure must be traceable and resources 
financed therewith should be identifiable through 
sound accounting practices. The same principle 
applies to other expenditure, beneficiaries and 
operations that could be financed under other EU 
funds or public support in general. Reply of the  
Commission
Reply of the Commission 39
As regards Pillar II, the outcome of the use of the 
planned TA funds is not fully known yet, as the 
Member States may submit expenditure declara ‑
tions throughout 2015. There is a wide variation 
among the Member States in relation to the propor ‑
tion of the rural development allocation they plan 
to use for TA. 
Observations
24
As regards Pillar I, funding of Member States’ 
administrative costs is excluded in the EAGF. 
Administrative costs incurred by beneficiaries of 
operational funds or programmes are eligible and 
can be included in the Member States’ declarations 
on the basis of the delegated acts adopted by the 
Commission under the new CMO Regulation (EC) 
No 1308/2013. 
25
The Commission recognises the importance of 
justification and transparency of TA ‑funded admin ‑
istrative costs. The sound implementation of the 
programmes, and ultimately the rural development 
policy, requires well ‑equipped administrations.
26
The Commission considers that Article 5 of Regula ‑
tion (EC) No 1290/2005 provides a single clear legal 
reference for both the EAGF and EAFRD at Commis ‑
sion level and/or on its behalf.
For the new programming period, TA at the level 
of the Member States is defined under Article 59 of 
Regulation (EC) No 1303/2013.
27
Despite the non ‑explicit inclusion of the term 
‘capacity ‑building’ in Article 5, all the itemised 
activities lead eventually to capacity ‑building of the 
Commission and Member States’ services for the 
legal and regular application of CAP rules.In the medium term, the Commission will request 
more detailed information within the current 
reporting systems in order to improve the monitor ‑
ing of the type of costs incurred (i.e. administrative 
and operational costs) under the TA budget. 
VII Fourth recommendation
The Commission accepts this recommendation.
The Commission will encourage Member States 
to use adequate indicators for the monitoring 
of TA expenditure, although it will not make it 
compulsory.
Introduction
13
The volume of TA spending is planned according to 
identified relevant needs. For example, Art   icle 8(c)
(vi) of Regulation (EC) No 1305/2014 introduces the 
requirement for the managing authorities to ensure 
adequate advisory capacity on regulatory require ‑
ments and actions related to innovation, a fact 
which might have triggered additional correspond ‑
ing needs in terms of TA.
The Commission has streamlined the approach 
towards TA in all ESI funds, establishing common 
legal provisions applicable to all. This provision 
(Article 59, Regulation (EC) No 1303/2013) slightly 
widens the scope of the expenditure eligible for 
support, including communication, networking, 
complaint resolution and audit activities, which 
were not used for the definition of TA in the previ ‑
ous rural development legal framework.
16
As regards Pillar I, all commitments have to be made 
within the budget year concerned and, barring the 
rare cases of allowed carry ‑overs from one budget 
year to the next, they lapse at the end of that year. 
However, payments can be made in the course of 
more than one budget year.
Reply of the Commission 40
31
According to the Commission’s accounting sys ‑
tems, the total value of commitments in 2013 was 
21.879.114 euro. The Commission has reinforced 
networking activities, in particular in relation with 
the European Innovation Partnership, at the end 
of the 2007–13 programming period. Networking 
activities were also a key element for the prepa ‑
ration of the next programming period. Overall, 
networking represents an important result ‑oriented 
activity underpinning policy conception. As regards 
IT systems, the development of new and more 
sophisticated tools (e.g. RDIS2, SFC) to prepare for 
the 2014–20 period was implemented mainly as 
from 2012 and consequently, related expenditure is 
substantially higher than in 2007. See also replies to 
paragraphs 32–35.
32
Common Commission reply to paragraphs 32 to 35:
The responsible Commission services have funded 
IT expenditure through a number of budget articles 
on the basis of the link of the expenditure con ‑
cerned with the underlying activity:
The budget articles used for this funding involve 
non ‑technical operational assistance of support 
expenditure for CAP operations (EAGF and EAFRD 
were separately funded through Article 05 01 04) 
and operational TA directly linked to the implemen ‑
tation of operational CAP programmes and activi ‑
ties (EAGF funded under article 05 08 09 and EAFRD 
under item 05 04 05 02).
The development and maintenance of IT admin ‑
istrative systems has been progressively taken on 
board by the horizontal services within the Com ‑
mission. However, the Commission has remained 
responsible for IT systems serving the CAP . The 
aforementioned budget articles cover both the 
initial development costs of the IT systems con ‑
cerned and their maintenance costs. These latter 
costs involve both the further development of these 
systems as needs arise (evolutive maintenance) 
and their needed corrective maintenance and 
operation.28
The legislator, when adopting the regulations, 
chose a flexible and wide approach for the use of 
TA by the Member States. The Commission cannot 
interfere with the application of such provisions, 
especially when the expenditure is found to be 
eligible. 
Nonetheless, for the current programming period, 
the Commission has issued specific guidelines for 
Member States, as well as policy lines and indicative 
indicators for desk officers.
Administrative costs supported by TA must be 
clearly linked to the implementation of the pro ‑
gramme. The flexibility in the use of funds under TA 
within the established ceilings does not imply a lack 
of rigour. Under shared management, Member 
States should ensure that the EU budget is spent 
following the principles of economy, efficiency and 
effectiveness (Article 30 of the financial regulation 
(Regulation (EC) No 966/2012).
TA expenditure supports activities of the national 
rural networks (NRNs) of the Member States, 
which are clearly defined and established in the 
legal framework (Article 68, Regulation (EC) No 
1698/2005) and in the RDPs.
30
In the Commission’s view, the ‘definition’ and 
the ‘nature’ of TA should be determined by the 
legislator. 
The aim of the vade mecum for the direct manage ‑
ment mode is to provide guidance on the valida ‑
tion, financial circuits, processes and procedures 
applied for the implementation of the budget and 
not to provide rules on budget allocation between 
headings.
Reply of the Commission 41
Moreover, the audited period was affected by 
a severe economic crisis, especially in certain 
Member States where national administrations 
experienced important cuts and lack of resources. 
In order to ensure a sound implementation of the 
policy and reduce the increasing level of error rate, 
such administrations sought EU funding through TA 
support.
43
Article 66(2) of Regulation (EC) No 1698/2005 states 
that ‘At the initiative of the Member States, for each 
rural development programme, the EAFRD may 
finance preparation, management, monitoring, 
evaluation, information and control activities of 
programme assistance. Up to 4 % of the total amount 
for each programme may be devoted to these 
activities.’ According to Article 71(3) of Regulation 
(EC) No 1698/2005, it is for the competent national 
authorities to set the rules on eligibility of expendi ‑
ture, subject to the special conditions laid down by 
Regulation (EC) No 1698/2005 for certain rural devel ‑
opment measures.
45
The Commission considers that reallocation of 
appropriations to management improves proces ‑
sing of aid applications and better advisory ser ‑
vices rendered to RDPs’ beneficiaries, especially 
with regard to complex investment measures, thus 
improving the overall programme implementation.
46
TA is partly used for the overall management of 
RDPs which is considered by decision ‑makers a nec ‑
essary support for the implementation of the policy. 
Therefore, it should be assessed in the light of the 
performance indicators of the RDPs. 
47
TA is largely used for easing the administrative 
burden of the beneficiaries, improving their knowl ‑
edge on, and information about, the programme 
implementation, or making full use of IT tools and 
e‑administration. Therefore, TA expenditure, even if 
dedicated partly to budget support, has a positive 
impact for the beneficiaries.Guidelines have been issued by the Commission for 
shared management programmes that provide for 
the necessary guidance on the type of budget line 
to use in the case of IT expenditure (and audit) for 
the purposes of adequate consistency with regards 
to the budgeting of the IT expenditure. All types of 
IT costs should follow these guidelines, whether IT 
development or IT maintenance and the mainte ‑
nance costs should always be charged in the same 
budget line as their respective IT development 
costs. This approach strengthens the budgetary 
discipline and consistency in all shared manage ‑
ment DGs.
36
See Commission reply to paragraph 28.
37
See Commission reply to paragraph 28.
38
The average figure regarding the use of TA for the 
2007–13 programming period (1. 57 %) and the 
estimated one for the 2014–20 programming period 
(1.97 %) reveal a moderate allocation by Member 
States and indicate that funds are only spent on 
needed activities related to the implementation of 
the RDPs. Furthermore, the actual amount spent 
in 2007–13 (as of 31 October 2014) was only 70 % 
of the planned amounts indicated in the annex. 
Therefore, only 1.16 % of the executed budget for 
2007–13 has been actually dedicated to TA. 
See also Commission reply to paragraph 13.
Common Commission reply to 
paragraphs 40 and 41
Sound financial management and ambitious policy 
objectives in rural development policy require 
enhanced administrative capacities in the Member 
States. In order to ensure an adequate implementa ‑
tion, an increased use of resources was dedicated to 
maintain administrative capacity in Member States. 
Reply of the Commission 42
50
The Commission has presented guidelines to 
Member States on the use of TA for the 2014–20 
programming period in the framework of the Rural 
Development Committee. 
51
The table in the annex is based on draft RDPs sub ‑
mitted by the Member States, the majority of which 
are still under discussion. 
See also Commission reply to paragraph 13. 
54
The Commission is conducting a number of audits 
in the Member States to verify TA expenditure. 
Errors reported by the Commission and the ECA are 
followed up and financial corrections are proposed.
The legal framework for 2014–20 programming 
period has been reinforced. The guidance fiche 
presented to Member States includes the following 
recommendation: ‘The administrative costs of the 
beneficiaries financed through technical assistance, 
including staff costs, should clearly be determined 
(type of administrative costs and criteria for attribu ‑
tion). In addition, when beneficiaries are also imple ‑
menting other Funds (i.e. ESIF or EAGF), the verifi ‑
ability and measurability of the administrative costs 
financed technical assistance must be ensured’.
55
Member States are made aware that TA can only 
relate to the RDPs and that a clear separation of 
administrative costs and staff costs related to Pillars 
I and II must be proven. 
See also reply to 54.48
National administrations in economically weaker 
Member States need increased support to meet 
EU commitments and obligations in terms of 
programme implementation. Such expenditure is 
needed to finance administrative resources linked 
to the implementation of the programme. 
Poland’s TA spending in percentage terms is rela ‑
tively low.
49
TA supports the implementation of the key objec ‑
tives of the policy, which would not be achieved 
in the absence of such funding. Therefore, the 
Commission believes that TA expenditure does 
not divert substantial resources from the objec ‑
tives of the policy, but on the contrary, it reinforces 
the implementation arrangements in the Member 
States. 
Only 1.16 % of the expenditure was spent on TA in 
2007–13 (of a possible ceiling of 4 %). This relatively 
minor percentage of rural development expendi ‑
ture does not show any will to maximise payments 
towards administrative costs of the Member States. 
Box 1 
Considering that the TA budget finances some 
overheads attributable to programme implementa ‑
tion, the share of such expenditure compared to the 
overall budget of the policy (i.e. 1.16 %) seems to be 
very limited.
In the Commission’s opinion, although the cost of 
controls in Member States should not be increased, 
emphasis should be put on the need to improve the 
quality and efficiency of controls.
Obligations linked to management, control, infor ‑
mation, publicity, networking monitoring and 
evaluation are necessary for a performing policy 
and their costs should be co ‑financed by the EAFRD. 
Reply of the Commission 43
Specific assurances with regard to compliance, in 
particular with respect to rules on competition and 
public procurement, have been provided by the 
Italian managing authority in the annual progress 
report.
Article 62 of Regulation (EC) No 1305/2013 broad ‑
ened the domain where an independent expert 
should perform or confirm the calculations. It also 
covers all operations where simplified cost options 
are used. 
62
In the 2014–20 programming period, the NRNs will 
be monitored through three specific output indica ‑
tors (Annex IV of Regulation (EC) No 808/2014). As 
for other activities funded under TA, the guidance 
fiche presented to Member States includes the fol ‑
lowing recommendation: ‘In order to comply with 
the general principles of sound financial manage ‑
ment of EU funds, technical assistance expenditure 
should be based on SMART operational objectives 
(Article 30, Financial Regulation (EC) No 966/2012), 
following appropriate needs assessment. The out ‑
puts should be monitored and evaluated, based on 
performance indicators. Member States are encour ‑
aged to establish additional specific indicators for 
technical assistance ’.
Box 4 
The RDPs are implemented through the measures 
which require support in the form of TA for their 
overall sound implementation. In this sense, the 
Commission considers the measures being the 
policy tools (toolkit) and TA a cross ‑cutting activity 
supporting the effective management of the RDPs. Box 2 
According to the Lithuanian authorities, the min ‑
istry approves regularly updated lists of employ ‑
ees partially assigned to work on RDPs together 
with specific percentages of their working time. 
In the paying agency, the pro rata attribution of 
the working time of the staff is established tak ‑
ing into account different funds managed by the 
agency, tasks and functions assigned, action plans 
approved, planned calls for proposals and their 
processing, on ‑the ‑spot checks etc.
As regards Hungary, on 19 December 2014, the 
Commission reminded the Hungarian authorities 
that for 2014–20 programming period a list of the 
beneficiaries of TA should be provided. In addition, 
where beneficiaries also implement other funds (i.e. 
ESIF or EAGF), the verifiability and measurability of 
the administrative costs financed must be ensured.
As regards Austria, during the 2014–20 programme 
negotiations, the authorities were made aware that 
TA can only relate to the RDPs and that a clear sepa ‑
ration of administrative costs and staff costs related 
to Pillars I and II must be proven. 
As regards Poland, the coefficients were estimated 
on the assumption that the share between Pillar 
I and II was unlikely to be changed over the period. 
It shall be noted that the Commission takes into 
account the Court’s observations during its own 
audits. 
See also reply to paragraph 55.
56
See Commission reply to paragraph 54.
Box 3
The Commission has repeatedly stressed the 
importance of compliance with the rules on public 
procurement in bilateral meetings and in various 
documents exchanged with the managing authori ‑
ties in line with Article 82(2)(f) of Regulation (EC) 
No 1698/2005.
Reply of the Commission 44
Moreover, the example of Poland demonstrates 
possible difficulty in preparation of a separate 
meaningful long ‑term assessment of needs in the 
area of TA. 
69
The Commission did not set separate objectives for 
all TA funding because it considered it not to be 
necessary, cost ‑effective or proportional. However, 
where relevant, it has developed multiannual plan ‑
ning and related milestones (evaluation, IT schema 
directeur, etc.).
73
TA was not mentioned separately in general guid ‑
ance on the CMEF because the performance 
requirements are indirectly covered and measured 
under the performance of the measures to which 
they contribute. 
The CMEF foresees the use of RDPs’ additional 
indicators (Article 81(2) of Regulation (EC) No 
1698/2005) to be defined by the Member States in 
order to allow the monitoring and evaluation of the 
specificities of the RDPs. It also introduced common 
evaluation questions for the TA to be evaluated in 
the mid ‑term and ex post  evaluations.
75
Given the wide variety of needs covered by TA, 
separating the monitoring and evaluation from 
the elements of the RDPs to which they contribute 
would necessitate a very large and costly framework 
to follow up relatively low expenditure. According 
to Annex VII of Regulation (EC) No 1974/2006, the 
annual progress report should contain information 
on the steps taken by the managing authority and 
the monitoring committee to ensure the quality 
and effectiveness of programme implementation, 
including TA. However, the evaluation of RDPs 
(including performance and impact assessments) 
should be performed in the mid ‑term and ex post 
evaluations.The intention to consider TA as separate from the 
measures is clearly evidenced by the fact that they 
are set in different chapters in the rural devel ‑
opment legislation. For instance, in the case of 
Regulation (EC) No 1305/2013, Chapter I of Title 
III describes the measures, Chapter II describes 
the common provisions for several measures and 
Chapter III describes TA and networking. Clearly 
TA is separated from the measures. However, this 
separation does not entail that TA is not monitored 
or evaluated. The RDPs are properly planned, moni ‑
tored and evaluated and the effects of TA underpin 
sound implementation and effective delivery of the 
RDPs as a whole. 
As regards Austria, the funding of administra ‑
tive costs executed by the paying agency was in 
line with the relevant EU legislation and therefore 
approved by the Commission. 
63
Since the monitoring and evaluation framework 
assesses the overall performance of the RDPs, an 
overspending on (non ‑operational) costs that do 
not contribute to programme performance would 
be reflected in a lower overall performance. There ‑
fore, the Commission considers that the contribu ‑
tion of TA is indirectly included in the assessment.
64
Objectives and targets are set appropriately at the 
level of the RDPs.
See also Commission reply to paragraph 62.
67
Member States are required to evaluate how the 
medium and long ‑term needs can be covered by 
the RDPs as a whole. 
Programme amendments must be duly justified by 
Member States and where TA expenditure is to be 
modified, concrete reasoning must be provided. 
Reply of the Commission 45
84
The Commission considers that Article 5 of Regula ‑
tion (EC) No 1290/2005 provides the single clear 
legal reference for both the EAGF and EAFRD at 
Commission level and/or on its behalf.
For the new programming period, TA at the level 
of the Member States is defined under Article 59 of 
Regulation (EC) No 1303/2013.
The freedom of choice resulting from the regulatory 
flexibility is needed to cope with the large variety 
of needs encountered by national and regional 
authorities. Sound implementation of the RDPs is 
very much linked to necessary costs such as admin ‑
istrative costs of the IT tools. Expenditure financed 
through TA is directly linked to the preparation, 
implementation and evaluation of the RDPs.
As regards the 2014–20 programming period, 
the Commission has presented comprehensive 
guidelines to the Member States and provided 
policy lines to desk officers in order to streamline 
approaches in the negotiation of new RDPs.
85
In accordance with the Commission’s ESIF budget ‑
ary guidelines for the shared management pro ‑
grammes on the use of the operational and the 
non ‑operational (administrative) TA in the case of IT 
and audit expenditure, all types of IT costs, whether 
related to IT development or IT maintenance, 
should always be charged in the same budget 
line as their respective IT development costs. This 
approach strengthens the budgetary discipline 
and consistency in all shared management areas 
of the Commission’s budget. As regards TA on the 
initiative of the Member States, payroll is an eligible 
expenditure if resources paid thereof are directly 
linked to the implementation of the RDP . In this 
regard, the guidance fiche presented to Member 
States on TA for the 2014–20 period includes spe ‑
cific information on how to attribute and finance 
staff costs.76
Given the high number of RDPs and the wide 
variety of needs covered, it is considered that the 
Member States are more suitable to assess where 
and how support, as defined in the legislation, is 
the most needed. Targeting is done by Member 
States on the basis of the assessment of needs 
and the funds are allocated to the concrete areas 
considered relevant. These areas, as shown by the 
figures, vary substantially from one Member State 
to the other.
77
Member States have notably increased coopera ‑
tion activities among the paying agencies in order 
to assess and remedy the existing shortcomings in 
the implementation causing high error rates. Such 
activities can be financed through TA. 
78
See Commission reply to paragraph 75.
82
For the 2014–20 programming period, one of the 
tasks of the rural networks’ assembly established in 
Article 3(d) of Commission Implementing Decision 
(EC) No 825/2014 is to ensure appropriate monitor ‑
ing and assessment of the activities of the ENRD 
and of the EIP network. Under the same regulation, 
Article 8(c) foresees the assessment on an ongo ‑
ing basis of the effectiveness and efficiency of the 
activities of the ENRD and of the EIP network.
Conclusions and recommendations
83
TA contributes to the implementation, monitor ‑
ing, control and evaluation of the RDPs. Only the 
synthesis of ex post  evaluations of the RDPs will be 
able to demonstrate the contribution of TA to the 
general CAP objectives.
The legislator decided to grant flexibility to Mem ‑
ber States in the use of TA funds. 
Reply of the Commission 46
91
TA being a cross ‑cutting supporting activity, 
the monitoring and evaluation of its spending is 
embedded in the monitoring and evaluation of the 
programmes as a whole. 
Specific financial output indicators are applied to 
TA. 
92
The potential effectiveness of a tool does not 
depend on the presence of a system to assess its 
impacts. 
Recommendation 4
The Commission accepts this recommendation.
The Commission will encourage Member States 
to use adequate indicators for the monitoring of 
the TA expenditure, although it will not make it 
compulsory. 86
The Commission encourages Member States to 
ensure that the administrative costs of the ben ‑
eficiaries financed through TA, including staff 
costs, are clearly determined. In addition, where 
beneficiaries also implement other funds (i.e. ESIF 
or EAGF), the verifiability and measurability of the 
administrative costs financed through TA must be 
ensured.1 
Recommendation 1
The Commission accepts this recommendation and 
will further develop guidance in this regard. 
Recommendation 2
The Commission cannot accept this recom ‑
mendation. It considers that IT maintenance is 
an operational activity linked to the update and 
development of the systems. In accordance with 
the Commission’s ESIF budgetary guidelines, dated 
16 May 2014, for the shared management pro ‑
grammes on the use of the operational and the 
non ‑operational (administrative) TA in the case of IT 
and audit expenditure, all types of IT costs, whether 
related to IT development or IT maintenance, 
should always be charged in the same budget 
line as their respective IT development costs. This 
approach strengthens the budgetary discipline and 
consistency in all shared management areas of the 
Commission’s budget.
Recommendation 3
The Commission accepts this recommendation.
In the medium term, the Commission will request 
more detailed information within the current 
reporting systems in order to improve the monitor ‑
ing of the type of costs incurred (i.e. administrative 
and operational costs) under the TA budget. 
1 Technical assistance guidance fiche, 2014–20.
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Technical assistance traditionally means the provision of 
expertise and funding to support government departments 
in the implementation of policy. In this audit, the Court 
examined how EU spending on technical assistance was 
used in the area of agriculture and rural development during 
2007–13. It found that there has been a move away from 
a ‘capacity-building’ understanding of technical assistance 
towards support for regular administrative costs. For this 
reason, and because of the absence of a suitable 
performance framework, neither the Commission nor the 
Member States are able to demonstrate how well technical 
assistance has contributed to the impact of the CAP .
EUROPEAN
COURT
OF AUDITORS