Proposal for a Council Regulation Amending Regulation (EC) No 1083/2006 on the European Regional Development Fund, the European Social Fund and the Cohesion Fund concerning certain provisions relating to financial management
Date: 2008-11-26
Institutions: European Commission
Subjects: Cohesion Fund, European Regional Development Fund, European Social Fund, competitiveness, cross-border cooperation, economic and social cohesion, financial management, operation of the Institutions, powers of the institutions (EU)

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 26.11.2008 
COM(2008) 803 final 

2008/0233 (AVC) 

Proposal for a 

COUNCIL REGULATION 

Amending Regulation (EC) No 1083/2006 on the European Regional Development Fund, 
the European Social Fund and the Cohesion Fund concerning certain provisions relating 
to financial management 

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EXPLANATORY MEMORANDUM 

1. 

BACKGROUND TO THE PROPOSAL 

•  Reasons and objectives for the proposal 

The  unprecedented  crisis  besetting  the  international  financial  markets  has  created 
major  challenges  for  the  European  Union  and  requires  a  rapid  response  in  order  to 
counter  the  impacts  on  the  economy  as  whole.  It  is  in  this  context  that  the 
Commission  wishes,  together  with  the  Member  States,  to  act  to  strengthen 
investment  with  a  view  to  generating  renewed  growth  and  job  creation.  This  is  the 
purpose  of  the  Commission  Communication  entitled  "From  financial  crisis  to 
recovery: a European framework for action" adopted on 29 October 2008. 

•  General context 

There are real fears that the financial crisis is substantially affecting the real economy 
due to the difficulties encountered by the banks and the tightening of credit (raising 
of  interest  rates,  greater  selectivity  in  borrowers)  which  could  reduce  household 
consumption as well as business investment, support to innovation, technological and 
industrial development with negative concomitant effects on GDP and employment. 

The  Commission's  most  recent  economic  forecasts  predict  a  marked  reduction  of 
growth  in  the  European  Union  -  which  would  fall  to  1,4 %  in  2008  (half  of  that 
achieved in 2007), 0,2 % in 2009 and 1,1 % in 2010. These poor economic prospects 
will  probably  weigh  heavily  on  public  finances.  Assuming  unchanged  policies, 
budget deficits could increase from 1 % of GDP in 2007 to 2,6 % in 2010. Reliable 
forecasting  on  public  finances  -  and  particularly  in  the  area  of  debt  -  is  difficult, 
however,  on  account  of  the  uncertainty  surrounding  the  budgetary  impacts  of 
emergency measures already taken by governments. 

In  order  to  combat  the  effects  of  the  crisis,  the  Member  States  have  acted  both 
individually  and  though  concerted  actions  agreed  at  European  and  international 
levels. In the United States, the government agreed to nationalise – on a case by case 
basis – companies in difficulty; this followed the agreement in early October for the 
State  to  buy  $700  billion  of  assets  at  risk.  In  Europe  different  national  plans 
announced at the same time total some €1.700 billion, comprising both refinancing 
guarantees and recapitalisation / nationalisation measures. 

It is in this context that the Commission has endeavoured to contribute to the debate 
currently  taking  place  within  the  Union  and  with  its  international  partners  on  how 
best to react to the current financial crisis and to its socio-economic consequences. In 
particular the Commission has examined together with Member States the possibility 
of accelerating investment projects and payments to Member States. 

To  do  this,  cohesion  policy  represents  the  most  powerful  and  relevant  lever  for 
assisting  the  real  economy.  With  total  financial  resources  of  €347  billion  for  the 
2007-2013  period  and  €250  billion  of  this  e nvelope  earmarked  for  Lisbon-related 

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investment, cohesion policy provides a powerful support for both budgetary stability 
and public investment in the Member States and the regions of the European Union. 

•  Provisions in force in the policy sphere of the proposal 

The serious economic repercussions suffered by the European economy will include 
the  reduction  of  growth  perspectives  over  the  medium  term  and  the  marked  slow-
down  in  real  growth  in  2009  and  2010.  According  to  the  latest  available  forecasts, 
several national economies will be in recession. These poor economic prospects will 
have  considerable  negative  impacts  on  the  public  finances  of  the  Member  States. 
Moreover  the  basic  conditions  for  implementing  cohesion  policy  –  which  requires 
public  match-funding  in  order  to  mobilise  Structural  Funds  –  risk  being  seriously 
disrupted.  

In such a situation, certain regulatory provisions presently in force should be adapted 
in  order  to  accelerate  the  implementation  of  investment  projects  and  the  making 
available of Community financial resources for the benefit of the Member States and 
the  regions  of  the  European  Union.  These  provisions  include  those  relating  to  pre-
financing, those concerning expenditure declarations – more specifically, on the one 
hand, the reimbursement of advances paid to beneficiaries within the framework of 
State  Aids  in  the  meaning  of  Article  87  of  the  Treaty  and,  on  the  other,  major 
projects  and  finally  those  relating  to  the  eligibility  of  expenditure  and  financial 
engineering instruments. 

•  Consistency with other policies and objectives of the Union 

Not applicable. 

2. 

CONSULTATION OF INTEREST PARTIES AND IMPACT ANALYSIS 

•  Consultation of interested parties 

The  effectiveness  of  actions  undertaken  by  public  authorities  to  counteract  the 
negative  effects  of  the  financial  crisis  on  the  real  economy  requires  rapid 
intervention.  The  urgency  of  the  situation  has  not  allowed  prior  consultation  of  the 
Member States. Thus, although these measures seek to accelerate the implementation 
of programmes, some of them are also simplifying in nature. In this connection the 
Member  States  have  stated  on  several  occasions  that  the  work  on  the  revision  of 
Article 55 of the General Regulation should be continued. Additionally the European 
Parliament and the European Court of Auditors have repeatedly expressed their wish 
to simplify the regulations governing the Funds. 

•  Procurement and use of expertise 

Use of external expertise has not been necessary. 

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•  Impact analysis 

All  options  for  the  acceleration  of  implementation,  including  the  simplification  of 
certain  administrative  procedures,  have  been  discussed.  The  present  proposal 
completes a series of non-regulatory adjustments which seek to ensure that Member 
States can fully exploit the existing scope for flexibility including, where necessary, 
the  possibility  of  modifying  or  simplifying  programmes  in  order  to  adapt  them  to 
new  requirements.  Equally  the  Commission  calls  on  Member  States  to  finalise  the 
description  of  their  system  of  their  management  and  control  systems  in  order  to 
accelerate  their  acceptance,  thus  permitting  quicker  handling  of  interim  financial 
transactions while respecting the rules of sound financial management. 

This  willingness  to  simplify  the  management  of  the  Funds  will  undeniably  have  a 
positive  impact  on  the  pace  of  programme  implementation,  particularly  in  terms  of 
providing greater levels of liquidity resource at the start-up stage. 

Accelerated  implementation  of  operational  programmes  will  also  represent  an 
effective  contribution  hastening  a  return  to  normal  economic  conditions  once  the 
crisis is over. In fact an increase in advances to beneficiaries within the framework of 
already  approved  programmes  will  actually  provide  additional  liquidity  at  all 
territorial levels. Equally these advances will help strengthen the impact of cohesion 
policy on the real economy.  

3. 

LEGAL ELEMENTS OF THE PROPOSAL 

•  Summary of the proposed measures 

The proposed modifications to Regulation (EC) No 1083/2006 laying down general 
provisions on the European Regional Development Fund, the European Social Fund 
and the Cohesion Fund seek to counteract the negative effects of the economic crisis 
in its totality, in order to accelerate in the short term the implementation of the Funds 
for the benefit of the real economy, notably through strengthened support to SMEs. 

The proposed modifications are concentrated on four principal areas: 

•  extending the scope of application of Article 44 relating to financial engineering 
instruments for the intervention of the EIB and EIF in support of Member States 
for the preparation and implementation of operational programmes; 

•  an amendment to Article 56 relating to the eligibility of expenditure with a view 
to clarifying the possibility of payment of overheads on the basis of flat rates and 
to  introduce  the  possibility  of  in-kind  contributions  being  considered  as  eligible 
expenditure at the time of establishing - or contributing to – funds; 

•  A  modification  of  the  dispositions  relating  to  expenditure  declarations:  (i)  for 
major  projects  with  the  removal  of  the  prohibition  from  including  incurred 
expenditures  for  such  projects  in  interim  payment  requests  before  major  project 
approval by the Commission and (ii) for State Aids within the meaning of Article 

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87  of  the  Treaty  through  the  removal  of  the  35 %  limit  hitherto  attaching  to 
advances  paid  to  beneficiaries  by  the  body  granting  the  aid,  thus  permitting 
advance payments of up to 100 %, other conditions remaining unchanged; 

•  An  increase  in  the  third  pre-financing  instalment  (2009)  of  2 %  for  Structural 
Funds for those Member States that acceded to the European Union on or after 1 
May 2004, the creation of a third instalment (2009) of 2,5 % for Structural Funds 
for  all  those  Member  States  which  had  acceded  to  the  European  Union  as 
constituted before 1 May 2004, in terms of the territorial co-operation objective, if 
the programme contains at least one participating Member State which acceded to 
the  European  Union  on  or  after  1  May  2004,  it  is  attributed  an  additional 
percentage  advance  of  2%  in  2009.  These  additional  resources  which  should  be 
made  available  at  the  beginning  of  the  year  should  be  rapidly  transferred  to 
beneficiaries, taking due account of the rules of sound financial management. 

•  Legal base 

Council  Regulation  (CE)  No  1083/2006  of  11  July  2006  laying  down  general 
provisions on the European Regional Development Fund, the European Social Fund 
and  the  Cohesion  Fund  and  repealing  Regulation  (EC)  No  1260/1999  defines  the 
common  rules  applicable  to  the  three  Funds.  Based  on  the  principle  of  shared 
management  between  the  Commission  and  the  Member  States,  this  regulation 
includes provisions for a new programming process as well as new arrangements for 
programme  (including  financial)  management,  monitoring,  financial  control  and 
evaluation of projects. 

•  Subsidiarity principle 

The proposal complies within the subsidiarity principle to the extent that it seeks to 
provide flanking support to the Member States in their combat against the effects of 
the  present  financial  crisis  through  changes  strengthening  their  role  within  the 
framework of shared management of the Funds. 

•  Proportionality principle 

The proposal conforms to the proportionality principle for the following reasons. 

On account of its being limited to five articles of the General Regulation, it allows 
discussion to be focussed on a few provisions of relatively technical nature and thus 
creates  the  conditions  for  a  rapid  (legislative)  revision,  the  only  means  of 
guaranteeing legal uncertainty which is strictly limited in terms of time and a rapid 
contribution towards the revival of economic activity in the European Union. 

Moreover,  by  reason  of  the  principles  of  equality  of  treatment  and  legal  security, 
only  the  amendment  relating  to  Article  56.2  should  apply  retrospectively  from 
1 August 2006, the date of coming into force of Regulation (CE) No 1083/2006.  

Thanks  to  the  proposed  simplifications,  the  financial  and  administrative  burden  on 
the Member States will be reduced. 

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•  Choice of instruments 

Proposed instrument: regulation. 

Other instruments would not be appropriate for the following reasons. 

The  Commission  has  explored  the  scope  for  manoeuvre  provided  by  the  Funds 
Regulations  to  accelerate  investment  projects  and  the  commitment  of  Community 
resources for the benefit of the Member State economies and the regions of the EU. 
Alongside  the  non-regulatory  modifications  presented  in  the  Communication  of  26 
November 2008, the Commission proposes modifications to the General Regulation 
which are limited to five Articles. The objective of these revisions is to facilitate the 
mobilisation of Community resources for the start-up of projects thereby accelerating 
both their implementation and the impact of such investments on the real economy. 

4. 

BUDGETARY IMPACT  

The  amount  of  additional  advance  payments  foreseen  in  2009  on  the  basis  of  the 
proposal totals €6,3 billion. Other proposed  amendments may increase the speed of 
interim payments. 

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2008/0233 (AVC) 

Proposal for a 

COUNCIL REGULATION 

Amending Regulation (EC) No 1083/2006 on the European Regional Development 
Fund, the European Social Fund and the Cohesion Fund concerning certain 
provisions relating to financial management 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular 
Article 161(3) thereof, 

Having regard to the proposal from the Commission, 

Having regard to the assent of the European Parliament, 

Having regard to the opinion of the European Economic and Social Committee, 

Having regard to the opinion of the Committee of the Regions, 

Whereas 

(1) 

(2) 

(3) 

The unprecedented crisis hitting international financial markets has brought about 
major challenges for the Community, which necessitates a rapid response in order 
to  counter  effects  on  the  economy  as  a  whole  and,  in  particular,  to  support 
investments in order to promote growth and employment. 

The  regulatory  framework  for  the  2007-2013  programming  period  has  been 
adopted  with  a  view  to  achieving  further  simplification  in  the  programming  and 
management  of  the  Funds,  their  effectiveness  and  subsidiarity  in  terms  of  their 
implementation. 

The adaptation of certain provisions of Regulation (EC) No 1083/2006 of 11 July 
2006  laying  down  general  provisions  on  the  European  Regional  Development 
Fund  and  the  Cohesion  Fund  and  repealing  Regulation  (EC)  No  1260/1999  is 
necessary in order to facilitate the mobilisation of Community financial resources 
for  the  start-up  of  operational  programmes  and  assisted  projects  within  the 
framework of these programmes in such a manner as to accelerate implementation 
and the impact of such investments on the economy. 

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(4) 

(5) 

It  is  necessary  to  strengthen  the  possibility  of  provision  by  the  European 
Investment Bank (EIB) and the European Investment Fund (EIB) of assistance to 
Member States in the preparation and implementation of operational programmes. 

Taking account of the status of the EIB and EIF as financial entities recognised by 
the Treaty, when financial engineering operations are organised involving them as 
holding funds, it should be possible to directly award them a contract.  

(6)  With  a  view  to  simplification,  it  is  all  the  more  appropriate  to  specify  the 
conditions  in  which  overheads  should  be  permitted  to  be  considered  as  paid 
expenditure by beneficiaries during the course of implementation of operations. 

(7) 

(8) 

(9) 

In order to facilitate the use of financial engineering instruments, notably within 
the  field  of  sustainable  urban  development,  it  is  necessary  to  provide  for  the 
possibility of in-kind contributions being considered as eligible expenditure in the 
constitution of – or contributions to – funds. 

In  order  to  support  enterprises,  and  in  particular  small  and  medium-sized 
enterprises, it is also necessary to make more flexible the conditions governing the 
payment of advances within the framework of State Aids under Article 87 of the 
Treaty. 

In  order  to  accelerate  the  implementation  of  major  projects,  it  is  necessary  to 
allow expenditures relating to major projects which have not yet been adopted by 
the Commission to be included in expenditure declarations. 

(10)  To  bolster  the  financial  resources  of  Member  States  thus  facilitating  the  rapid 
start-up  of  operational  programmes  in  a  crisis  context,  it  is  necessary  to  modify 
the provisions concerning pre-financing. 

(11)  The  payment  of  a  payment  on  account  at  the  beginning  of  operational 
programmes  should  allow  a  regular  cash  flow  and  facilitate  payments  to 
beneficiaries  during  programme  implementation.  For  this  reason  provisions 
should  be  established  for  such  payments  on  account  for  the  Structural  Funds: 
7,5% (for Member States for Member States of the European Union as constituted 
before 1 May 2004) and 9% (for the Member States who acceded to the European 
Union  on  or  after  1  May  2004)  in  order  to  accelerate  the  implementation  of 
operational programmes. 

(12)  By  reason  of  the  principles  of  equality  of  treatment  and  of  legal  security,  solely 
the amendment relating to Article 56.2 should apply with retroactive effect from 1 
August 2006, the date on which Regulation (EC) No 1083/2006 came into force. 

(13)  Regulation (EC) No 1083/2006 should therefore be modified. 

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HAS ADOPTED THIS REGULATION 

Article 1 

Regulation (EC) No 1083/2006 is modified as follows: 

1. 

At Article 44, the second paragraph, is amended as follows:  

a) point (b) is replaced by the following text: 

(b) "when the agreement is not a public service contract within the meaning of 
applicable public procurement law, the award of grant, defined for this purpose 
as  a  direct  financial  contribution  by  way  of  donation  to  a  financial  institution 
without call for proposals, if this is in accordance with a national law compatible 
with the Treaty." 

b) the following point (c) is added: 

"(c) the award of a contract directly to the EIB or the EIF." 

2. 

At Article 46.1, the following second paragraph is added: 

"The  EIB  or  the  EIF  may  upon  request  of  the  Member  States  take  part  in 
technical assistance activities referred to in the first paragraph." 

3. 

Article 56.2 is replaced by the following text: 

"2. By way of derogation from Article 56.1, contributions in kind, depreciation 
costs and overheads may be considered as incurred expenditure by beneficiaries 
for the implementation of operations under the conditions laid down in the third 
paragraph. 

By  way  of  derogation  from  paragraph  1,  contributions  in  kind,  as  regards 
financial engineering instruments as defined in Article 78 (6), first subparagraph, 
can  be  treated  as  expenditure  paid  at  the  constitution  of  the  funds  or  holding 
funds  or  contributing  to  those  funds  or  holding  funds,  under  the  conditions 
established in the third subparagraph of this paragraph. 

Expenditure  mentioned  in  the  first  and  second  paragraphs  must  fulfil  the 
following conditions: 

a) the eligibility rules drawn up on the basis of paragraph 4 foresee the eligibility 
of such expenditures; 

b)  the  amount  of  the  expenditure  is  duly  justified  by  supporting  documents 
having equivalent probative value to invoices; 

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c) in the case of contributions in kind, the co-financing from the Funds does not 
exceed 
the  value  of  such 
contributions. 

total  of  eligible  expenditure  excluding 

the 

By  derogation  to  point  b)  above,  and  within  the  context  of  grants,  overheads 
mentioned in the first paragraph of this section may be declared on the basis of a 
flat  rate.  This  rate  is  to  be  established  in  advance  according  to  an  accurate, 
reasonable and verifiable method of calculation." 

4. 

Article 78 is modified as follows: 

a) Article 78.2: point (b) is deleted; 

b) Article 78.4 is replaced by the following text: 

"4.  When,  in  application  of  Article  41.3,  the  Commission  refuses  to  make  a 
financial  contribution  to  a  major  project,  the  expenditure  declaration  following 
the adoption of the Commission must be rectified accordingly." 

5. 

Article  82.1,  second  paragraph,  points  (a),  (b)  and  (c)  are  replaced  by  the 
following text: 

(a) for Member States of the European Union as constituted before 1 May 2004: 
in  2007,  2 %  of  the  contribution  from  the  Structural  Funds  to  the  operational 
programme,  in  2008  3 %  of  the  contribution  from  the  Structural  Funds  to  the 
operational  programme  and  in  2009,  2,5 %  of  the  contribution  from  the 
Structural Funds to the operational programme; 

(b)  for  Member  States  that  acceded  to  the  European  Union  on  or  after  1  May 
2004:  in  2007  2 %  of  the  contribution  from  the  Structural  Funds  to  the 
operational  programme,  in  2008  3 %  of  the  contribution  from  the  Structural 
Funds to the operational programme and in 2009, 4 % of the contribution from 
the Structural Funds to the operational programme; 

(c) if the operational programme falls under the European territorial cooperation 
objective and at least one of the participants is a Member State that acceded to 
the  European  Union  on  or  after  1  May  2004,  2 %  of  the  contribution  from  the 
European  Regional  Development  Fund  to  the  operational  programme,  in  2008 
3 %  of  the  contribution  from  the  European  Regional  Development  Fund  to  the 
operational programme and in 2009, 4 % of the contribution from the European 
Regional Development Fund to the operational programme. 

Article 2 

This regulation shall enter into force on the day following its publication in the Official 
Journal of the European Union. 

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However, Article 1.3 is applicable with effect from 1 August 2006.  

This  Regulation  shall  be  binding  in  its  entirety  and  directly  applicable  in  all  Member 
States. 

Done at Brussels,  

For the Council 
The President

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LEGISLATIVE FINANCIAL STATEMENT 

This document is intended to accompany and complement the Explanatory Memorandum. 
As such, when completing this Legislative Financial Statement, and without prejudice to 
its legibility, an attempt should be made to avoid repeating information contained in the 
Explanatory  Memorandum.  Before  filling  in  this  template,  please  refer  to  the  specific 
Guidelines  that  have  been  drafted  to  provide  guidance  and  clarification  for  the  items 
below.  

1. 

NAME OF THE PROPOSAL: 

Proposal  for  a  COUNCIL  REGULATION  amending  Regulation  (EC)  No 
1083/2006  on  the  European  Regional  Development  Fund,  the  European  Social 
Fund and the Cohesion Fund concerning certain provisions relating to financial 
management 

2. 

ABM / ABB FRAMEWORK 

Policy Area(s) concerned and associated Activity/Activities: 

Regional Policy; ABB activity 13.03  

Employment and social Affairs; ABB activity 04.02 

3. 

BUDGET LINES 

3.1. 

Budget  lines  (operational  lines  and  related  technical  and  administrative 
assistance lines (ex- B.A lines)) including headings: 

The proposed new action will be implemented on the following budget lines in 
2009:  

•  13.0316 Convergence 

•  13.0318 Regional competitiveness & employment 

•  13.0319 European territorial cooperation 

•  04.0217 Convergence 

•  04.0219 regional Competitiveness 

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3.2. 

Duration of the action and of the financial impact: 

The  budgetary  impact  is  on  the  payments  Budget  for  2009  with  the  advance 
being  made  as  soon  as  possible  following  the  adoption  of  the  Draft  Council 
Regulation amending Regulation 1083/2006. In view of the uncertainties linked 
to the timing of the receipt of interim payment claims and in regard to progress 
of  the  compliance  by  Member  States  with  article  71  of  Council  Regulation 
1083/2006,  the  proposed  advance  will  be  funded  from  within  the  existing 
payments  budget.  In  the  light  of  Member  State's  progress  in  regard  to  the 
submission of interim payments and of satisfactory compliance assessments, the 
Commission will in 2009 review the need for additional payment credits and if 
necessary propose the necessary actions to the Budgetary Authority. 

3.3. 

Budgetary characteristics (add rows if necessary): 

Budget 
line 

13.0316 

13.0318 

13.0319 

13.0402 

04.0217 

04.0219 

Type of expenditure 

New 

EFTA 
contribution 

Contributions 
from applicant 
countries 

Heading in 
financial 
perspective 

Non-
comp 

Non-
comp 

Non-
comp 

Non-
comp 

Non-
comp 

Non-
comp 

Diff 

NO 

NO 

Diff 

NO 

NO 

Diff 

NO 

NO 

Diff 

NO 

NO 

Diff 

NO 

NO 

Diff 

NO 

NO 

NO 

NO 

NO 

NO 

NO 

NO 

No 1b 

No 1b 

No 1b 

No 1b 

No 1b 

No 1b 

4. 

SUMMARY OF RESOURCES 

4.1. 

Financial Resources 

4.1.1. 

Summary of commitment appropriations (CA) and payment appropriations (PA)  

No further additional financial resources for 2009 will be requested at this stage 
due to uncertainties linked to the timing of the receipt of interim payment claims 
and in regard to progress of the compliance by Member States with article 71 of 
Council Regulation 1083/2006.  

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The following tables show the impact of the proposed advances. The measure on 
simplification  and  the  possibility  to  have  interim  payment  payments  for  major 
projects before the decision of the Commission approving them could also have 
an  impact  on  the  repartition  of  the  payment  appropriations,  leading  to  some 
frontloading in 2009/2010. However at this stage is effect is difficult to quantify. 

EUR million (to 3 decimal places) 

Section 
no. 

Expenditure type 

n + 1 

n + 2 

n + 3 

n + 4 

Year 
n 

n + 5 
and 
later 

Total 

Operational expenditure1 

Commitment 
Appropriations (CA) 

8.1 

Payment  Appropriations 
(PA) 

a 

b 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

0 

0 

0 

n.a. 

6 
250,
833 

-6 
250,
833 

Administrative expenditure within reference amount2 

Technical & 
administrative assistance 
(NDA) 

8.2.4 

c 

TTOOTTAALL  RREEFFEERREENNCCEE  AAMMOOUUNNTT  

n.a.   n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

Commitment 
Appropriations 

Payment 
Appropriations 

a+c  n.a. 

n.a. 

b+c 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

0 

0 

0 

6 
250,
833 

0 

6 

- 
250,
833 

Administrative expenditure not included in reference amount3 

Human 
associated 
(NDA) 

resources 

and 
expenditure 

Administrative  costs,  other 
than  human  resources  and 
associated 
not 
included in reference amount 
(NDA) 

costs, 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

8.2.5 

d 

8.2.6 

e 

1 
2 
3 

Expenditure that does not fall under Chapter xx 01 of the Title xx concerned. 
Expenditure within article xx 01 04 of Title xx. 
Expenditure within chapter xx 01 other than articles xx 01 04 or xx 01 05. 

EN 

14 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
  
  
  
  
  
  
 
 
 
 
 
 
                                                 
Total indicative financial cost of intervention 

TOTAL  CA 
cost 
Resources 

of 

TOTAL  PA 
cost 
Resources 

of 

including 
Human 

including 
Human 

a+c+d
+e 

b+c+d
+e 

Co-financing details 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

0 

0 

0 

n.a. 

6 
250,
833 

0 

- 6 
250,
833 

Co-financing body 

…………………… 

TOTAL CA including co-
financing 

f 

a+c
+d+
e+f 

EUR million (to 3 decimal places) 

Year n 

n + 1 

n + 2 

n + 3 

n + 4 

n + 5 and 
later 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

Total 

n.a. 

n.a. 

4.1.2  Compatibility with Financial Programming 

⌧  Proposal is compatible with existing financial programming. 

(cid:133) 

(cid:133) 

Proposal will entail reprogramming of the relevant heading in the financial 
perspective. 

Proposal may require application of the provisions of the Interinstitutional 
Agreement4  (i.e.  flexibility  instrument  or  revision  of  the  financial 
perspective). 

4.1.3 

Financial impact on Revenue 

⌧  Proposal has no financial implications on revenue 

(cid:133) 

Proposal has financial impact – the effect on revenue is as follows: 

NB:  All  details  and  observations  relating  to  the  method  of  calculating  the 
effect on revenue should be shown in a separate annex. 

4 

See points 19 and 24 of the Interinstitutional agreement. 

EN 

15 

   EN 

 
 
 
 
 
 
 
 
 
 
                                                 
Budget line 

Revenue 

EUR million (to one decimal place) 

Prior to
action 
[Year 
n-1] 

[Yea
r n] 

Situation following action 

[n+1] [n+2] [n+3

[n+4] 

[n+5]5

] 

a) Revenue in absolute 
terms 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

b) Change in revenue 

 ∆ 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

(Please  specify  each  revenue  budget  line  involved,  adding  the  appropriate 
number of rows to the table if there is an effect on more than one budget line.) 

4.2. 

Human Resources FTE (including officials, temporary and external staff) – 
see detail under point 8.2.1. 

Annual requirements 

Year n 

n + 1 

n + 2 

n + 3 

n + 4 

n + 5 and later 

Total 
number 
human resources 

of 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

5. 

CHARACTERISTICS AND OBJECTIVES 

Details  of  the  context  of  the  proposal  are  required 
in  the  Explanatory 
Memorandum.  This  section  of  the  Legislative  Financial  Statement  should  include 
the following specific complementary information: 

5.1. 

Need to be met in the short or long term 

The current deteriorating economic prospective will have a negative impact on 
the public finances of the Member States, putting into question the capacity of 
Member States to maintain expected levels of national co-financing as required 
for  the  smooth,  efficient  and  quick  start-up  and  implementation  of  operational 
programmes.  Indeed,  in  a  context  of  economic  downturn,  the  objective  of  this 
modification to the Council Regulation is to act rapidly in order to facilitate the 
acceleration of investment and, in this way, to provide an early boost to growth 
and employment. 

5 

Additional columns should be added if necessary i.e. if the duration of the action exceeds 6 years 

EN 

16 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
5.2. 

Value-added  of  Community  involvement  and  coherence  of  the  proposal 
with other financial instruments and possible synergy 

introducing  more  flexibility  and 

By 
the 
implementation of the operational programmes will be better placed to resist the 
negative  impacts  of  the  current  economic  downturn  and  to  build  a  rhythm  of 
implementation  allowing  achieving  the  objective  of  boosting  growth  and 
employment.  

increasing  cash  availabilities, 

5.3. 

Objectives,  expected  results  and  related  indicators  of  the  proposal  in  the 
context of the ABM framework 

It  has  been  assessed  that  given  the  uncertainties  linked  to  the  timing  of  the 
receipt of interim payment claims and in regard to progress of the compliance by 
Member  States  with  article  71  of  Council  Regulation  1083/2006,  the  proposed 
advance can be funded from within the existing payments budget subject to the 
possible need for additional payments credits in the second semester of 2009.  

The positive  effects  of  this modification are expected for mid to late 2009 and 
also  for  early  2010  and  they  would  counter  any  relatively  slow  start  to  the 
programming  period.  More  flexibility  leading  to  simplifications  as  well  as 
further pre-financing seem to provide together an adequate reply to the current 
needs of the Member States for a larger margin of manoeuvre.  

5.4.  Method of Implementation (indicative) 

Show below the method(s)6 chosen for the implementation of the action. 

(cid:133)  Centralised Management 

(cid:133) 

(cid:133) 

directly by the Commission 

indirectly by delegation to: 

(cid:133) 

(cid:133) 

(cid:133) 

executive Agencies 

bodies set up by the Communities as referred to in art. 185 of 
the Financial Regulation 

national  public-sector  bodies/bodies  with  public-service 
mission 

(cid:58) 

Shared or decentralised management 

(cid:58)  with Member states 

6 

If more than one method is indicated please provide additional details in the "Relevant comments" 
section of this point 

EN 

17 

   EN 

 
                                                 
(cid:133)  with Third countries 

(cid:133) 

Joint management with international organisations (please specify) 

Relevant comments:  

For ESF, the amount of the additional advance of 2,5 % for the EU-15 Member States 
and 2% for EU-12 Member States is 1,763 M€.  

For ERDF, the amount of the additional advance of 2,5 % for the EU-15 Member States 
(with Cross border initiatives set at 2%) and 2% for EU-12 Member States is 4,488 M€. 

The total amount of the proposed further pre-financing totals 6,251 €M. 

EU12
EU15
EU cross-border cooperation
Sum:

2,0 %
2,5 %
2,0 %

ERDF
1.764.808.036
2.567.983.696
155.382.632

ESF
528.758.858
1.233.899.696

4.488.174.364

1.762.658.554

Advance total

2.293.566.894
3.801.883.392
155.382.632
6.250.832.918

2000-2006 interim payments: the B2009 is based on the hypothesis that the payments in 
2009 will reach the 95% threshold.  

2007-2013  interim  payments:  some  factors  may  have  a  negative  impact  on  the  interim 
payments  notably  the  risk  of  a  delayed  submission  of  compliance  assessments  by 
Member States and due to late compliance assessment, the risk that some Member States 
send their interim payments at the end of the year.  

EN 

18 

   EN 

 
 
 
6. 

MONITORING AND EVALUATION 

6.1.  Monitoring system 

The  currently  in  place  monitoring  of  acceptance  of  compliance  assessments, 
adoption  of  major  projects  and  interim  payments  of  period  2007-2013  will 
ensure the smooth budgetary execution of the proposed modification.  

6.2. 

Evaluation 

6.2.1.  Ex-ante evaluation 

Given  the  emergency  situation  requiring  a  very  quick  reaction,  no  ex-ante 
evaluation has been undertaken.  

6.2.2.  Measures  taken  following  an  intermediate/ex-post  evaluation  (lessons  learned 

from similar experiences in the past) 

6.2.3.  Terms and frequency of future evaluation 

The monitoring system in place is made on a monthly basis.  

7. 

ANTI-FRAUD MEASURES  

N.A. 

EN 

19 

   EN 

 
8. 

DETAILS OF RESOURCES 

8.1. 

Objectives of the proposal in terms of their financial cost 

(Headings of Objectives, 
actions and outputs should be 
provided) 

OPERATIONAL OBJECTIVE 
No.1 7…Sustain the 
implementation of the 
operational programmes 

Action 1 – Further pre-
financing 

Action 2 – Simplification of 
management of major projects 

Action 3 – Simplification of 
pre-financing related to State 
aid 

Action 4 – Simplification of 
financial engineering 

Action 4 – Clarification on 
lump sum for overheads 

TOTAL COST 

Type of 
output 

Av. 
cost 

Year 
n 

Year 
n+1 

Year 
n+2 

Year 
n+3 

Year 
n+4 

Year n+5 and 
later 

TOTAL 

No. 
outputs 

Total 
cost 

No. 
outputs 

Total 
cost 

No. 
outputs 

Total 
cost 

No. 
outputs 

Total 
cost 

No. 
outputs 

Total 
cost 

No. 
outputs 

Total 
cost 

No. 
outputs 

Total 
cost 

Commitment appropriations in EUR million (to 3 decimal places) 

0,000 

0,000 

0,000 

0,000 

0,000 

0,000 

7 

As described under Section 5.3 

EN 

20 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
8.2. 

Administrative Expenditure 

8.2.1.  Number and type of human resources 

Types of 
post 

Staff to be assigned to management of the action using existing and/or additional 
resources (number of posts/FTEs) 

Year n 

Year n+1 

Year n+2 

Year n+3 

Year n+4 

Year n+5 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

Officials or 
temporary 
staff8 (XX 
01 01) 

A*/A
D 

B*, 
C*/A
ST 

Staff  financed9  by 
art. XX 01 02 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

Other staff10 
financed by art. XX 
01 04/05 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

TOTAL 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

8.2.2.  Description of tasks deriving from the action 

8.2.3. 

Sources of human resources (statutory) 

(When  more  than  one  source  is  stated,  please  indicate  the  number  of  posts 
originating from each of the sources) 

(cid:133) 

(cid:133) 

(cid:133) 

(cid:133) 

(cid:133) 

Posts currently allocated to the management of the programme to be replaced 
or extended 

Posts pre-allocated within the APS/PDB exercise for year n 

Posts to be requested in the next APS/PDB procedure 

Posts  to  be  redeployed  using  existing  resources  within  the  managing  service 
(internal redeployment) 

Posts required for year n although not foreseen in the APS/PDB exercise of the 
year in question 

8 
9 
10 

Cost of which is NOT covered by the reference amount 
Cost of which is NOT covered by the reference amount 
Cost of which is included within the reference amount 

EN 

21 

   EN 

 
 
 
 
                                                 
8.2.4.  Other  Administrative  expenditure  included  in  reference  amount  (XX  01  04/05  – 
8Expenditure on administrative management)UR million (to 3 decimal places) 

Budget line 

(number and heading) 

Year 
n 

Year 
n+1 

Year 
n+2 

Year 
n+3 

Year 
n+4 

Year 
n+5  

and 
later 

TOTAL 

Technical 

and 
1 
assistance (including related staff costs) 

administrative 

Executive agencies11 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

Other technical and administrative 
assistance 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

- intra muros  

- extra muros 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

Total Technical and administrative 
assistance 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

8.2.5.  Financial cost of human resources and associated costs not included in the reference 

amount 

Type of human resources 

Year n 

Year n+1  Year n+2  Year n+3  Year n+4 

Year n+5 

and later 

EUR million (to 3 decimal places) 

Officials and temporary staff  
(XX 01 01) 

Staff financed by Art XX 01 02 
(auxiliary, END, contract staff, etc.) 

(specify budget line) 

Total cost of Human Resources 
and associated costs (NOT in 
reference amount) 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

Calculation– Officials and Temporary agents 

Reference should be made to Point 8.2.1, if applicable 

n.a. 

11 

Reference should be made to the specific legislative financial statement for the Executive Agency(ies) 
concerned. 

EN 

22 

   EN 

 
 
 
 
 
 
 
 
 
 
                                                 
Calculation– Staff financed under art. XX 01 02 

Reference should be made to Point 8.2.1, if applicable 

n.a. 

8.2.6.  Other administrative expenditure not included in reference amount 

EUR million (to 3 decimal places) 

Year 
n 

Year 
n+1 

Year 
n+2 

Year 
n+3 

Year 
n+4 

Year 
n+5 
and later 

TOTAL 

 XX 01 02 11 01 – Missions 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

XX 01 02 11 02 – Meetings & Conferences 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

XX 01 02 11 03 – Committees12  

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

XX 01 02 11 04 – Studies & consultations 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

XX 01 02 11 05 - Information systems 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

2.  Total Other Management 

Expenditure (XX 01 02 11) 

3.  Other expenditure of an 

administrative nature (specify 
including reference to budget line) 

Total Administrative expenditure, other 
than human resources and associated 
costs (NOT included in reference 
amount) 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

Calculation - Other administrative expenditure not included in reference amount 

n.a. 

12 

Specify the type of committee and the group to which it belongs. 

EN 

23 

   EN