Friday, 30 November 2012

€63bn for Horizon 2020

While the recent summit between EU heads of state and government failed to reach agreement on the EU budget for 2014-2020, it did produce interesting information. The compromise proposed by Herman van Rompuy, who chaired the meeting, suggests that he hoped to get agreement on a budget which would give Horizon 2020 about €63bn.

For the EU budget sub-heading 1a (Competitiveness for growth and jobs), which includes Horizon 2020, the Van Rompuy figures show a budget of €139,452m. His proposal identifies budgets for some elements of the sub-heading (see table). Subtracting these leaves €84,640m, which must fund activities originally planned by the European Commission to cost €107,187m, including €80bn for Horizon 2020. So, a pro rata reduction of budgets would give €63,172m for H2020.

Friday, 2 November 2012

Council undermines EC’s H2020 simplifications

The Council of Ministers – official representatives of the EU Member States – has made two tentative decisions which go against simplifications proposed by the European Commission (EC) for Horizon 2020.  In its initial conclusions on the EC’s proposed Rules for Participation (known as a “partial general approach”), the Council decided that, for close to market projects, funding would be 100% of eligible costs for not-for-profit organisations, and 70% for the rest. The EC had proposed 70% for all organisation types. 

The Council also decided that productive hours – the hours a researcher is available for work in a year – could be either a number laid down by the EC in the grant agreement, or based on a method taking account of the participant’s usual accounting practices. The EC had proposed that everyone used a figure it would decide. Productive hours are fundamental to the costs claimed on EU projects, and through its audits the EC has criticised the figures used by many organisations.
Other important decisions were to offer a flat rate for overheads of 25% of direct costs, compared with the EC’s suggestion of 20%; to allow one organisation to guarantee the participation of another (in FP7, a parent company was not permitted to provide guarantees for its subsidiaries); and to allow a bonus of up to €8000 per year per researcher if this is the normal practice of an organisation. The latter proposal is an attempt to handle the tradition in some newer Member States of paying researchers extra for each research contract they win. Unfortunately, €8000 appears to be far below the norm in these countries.

Of course, we are some way from finalising these matters. The next major event for Horizon 2020 is when the European Parliament decides its position. This is scheduled for December, but first there is the meeting of EU heads of state and governments to decide the total EU budget for the period 2014 – 2020. Negotiations on this are not going well!

Monday, 1 October 2012

And an index!

Many important European Commission documents lack a list of contents. For example, the EC’s proposals for Horizon 2020 consist of a Proposal establishing the Framework Programme (119 pages), Rules for Participation (36 pages) and the Specific Programme Implementing Horizon 2020 (128 pages), all with lots of sections with headings and subheadings, but no contents list. The “no contents list” even extends to the current  Guide for Applicants, which in many parts of FP7 comes in two parts: a general part (about 30 pages) with contents list and an annex specific to a Call (about 40 pages) without a contents list.

So it was amusing to find, amongst the 240 pages of text which will become the EU’s new Financial Regulation, an amendment from the Council of Ministers stating “The readability of this Regulation should be improved by attaching an index that includes also the names of each article”. A small step on the road to simplification?

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Tuesday, 4 September 2012

In a bad mood

Before slipping away for summer, the EC issued a new manual for users of its “FORCE” software, through which many FP7 participants submit their financial reports (Forms C). Rejection of Form C accounts for one third of payment delays. The manual includes a table of the history of a specific report, reproduced here. The EC Rejection comment confirms what many of us have long thought.

EC Submission Date
EC Rejection Comment
No Audit Details
I am in a bad mood

Wednesday, 1 August 2012

Europe First and Horizon 2020

Amongst its proposals for Horizon 2020, the EC made no change to the FP7 rule concerning access to IPR for affiliates. The rule allows affiliates to have access to the IPR of other consortium members in an EU funded research project on the same terms as a partner in the project, but only if the affiliates are established in the EU or associated countries.

For many multi-national companies this is incompatible with their normal practices for exploiting their IPR. Their manufacturing is located where it is most economic, and sometimes this is outside Europe, necessitating a corresponding transfer of IPR. The grant agreement rule obliged them to negotiate additional terms in their project consortium agreement to cover this situation, causing long discussions with other consortium members and occasionally disagreements.

The EC proposal reflects the “Europe First” policy advocated by its High Level Group on Key Enabling Technologies, which reported last year. The group suggested that EU rules should favour “Europe First” exploitation of the results of EU funded research projects, paralleling the situation in the USA under the Bayh-Dole Act, which favours commercialisation in the USA of its publically funded inventions. The High Level Group specifically proposed this limit on affiliate access.

Interestingly, the group also proposed that public laboratories should only be allowed to license their results of EU funded research within the EU. However no such restriction is proposed for Horizon 2020, except where exclusive licences are envisaged.

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Tuesday, 26 June 2012

DG INFSO shoots H2020 in the foot

Through an enthusiastic campaign of auditing and error correction, DG INFSO has reduced the error rate in FP6 project cost claims to 1.9% by the end of 2011. This has significant implications for the EC’s proposed simplifications for Horizon 2020, because it shows that some EC teams can achieve the target 2% error without imposing unrealistic limitations on eligible cost rules.

The target error rates in costs claimed for FP6, FP7 and H2020 are all 2%. The EC’s proposals state that a 2% error rate can only be achieved in H2020 if its many proposed simplifications are accepted. These include overheads of 20% of direct costs, a standard number of working hours in a year, and the same funding rate for all types of organisation.

DG INFSO (the Directorate General for Information Society and Media) administers the Information and Communications Technology theme within FP7 and its FP6 predecessor. This theme accounts for 16% of the total FP7 budget. The same DG achieves time to grant (from proposal submission to grant agreement signature) of about 270 days, compared with 360 days across the whole of FP7. In Horizon 2020 the EC aims to achieve 270 days average across the whole programme. Seems that better management might achieve the EC’s objectives without imposing many changes on


Friday, 1 June 2012

FP7 and the London Olympics

Those planning a trip to the London Olympics don’t need to worry that athletes, officials, dignitaries and spectators might arrive late for their events. FP7 project STADIUM is designing ICT applications to control transport for large events hosted by big cities. And the London Olympics is one of the project’s demonstration sites.

We hope the consortium have Tom Cruise on standby, because it looks like “Mission Impossible” to us.

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Wednesday, 2 May 2012

Draft Workprogrammes released

Calls for proposals in most parts of FP7 are expected in mid July 2012. At that time the corresponding Workprogrammes will be published. Given the short time to submit proposals, with many deadlines in September and October, draft Workprogrammes are being released. Six of these can be found on our website.

Friday, 30 March 2012

When “economic, efficient and effective” met Ryanair

When the EC can’t find a specific rule to exclude a cost which they don’t wish to accept, they often describe it as “uneconomic”. Now Ryanair, a low cost airline, has used the same rule against them. The EC invited Ryanair’s chief executive, Michael O’Leary, to lecture at an innovation conference in Brussels. All travel, including chauffeured transport from the airport, would be organised and paid for by the EC.

However, when he asked to fly Ryanair to Brussels Charleroi airport he was told that the EC’s travel agent could not book this travel, because their computer systems did not interface to Ryanair’s. Further investigation found that the travel agent also organises business travel for EC staff, and does not book Ryanair flights for them. How could the EC have selected a travel agent that doesn’t work with (according to Ryanair) Europe’s largest low-cost airline, so missing out on the opportunity to reduce travel costs?

Lawyers for Ryanair have filed a formal complaint with the European Court of Auditors, which audits the EC, asking it to assess “the legality, regularity and financial soundness” of the EC’s travel policy.


Forthcoming Singleimage workshops:

19 April Finance in FP7 – with guest auditor (Brussels)
24 April Consortium Agreements for FP7 (Cambridge)
22 May Winning FP7 bids (Cambridge)
26-27 June Finance in FP7 – the fuller picture (Cambridge)
3 July Coordinating FP7 projects (Cambridge)

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Thursday, 1 March 2012

When is a rule not a rule?

One of the EC’s most arcane FP7 “rules” is that pre-financing paid to a project coordinator must be placed in an interest bearing bank account. The EC claims this is required by the EU’s Financial Regulation. The University of Copenhagen disputed their interpretation of the legal texts, and won.

The case was mediated by the European Ombudsman from September 2010 to December 2011, when the EC finally agreed to relax the rule in cases where the coordinator says that the cost of establishing or operating an interest bearing account outweighed the interest to be earned. This now appears in the January 2012 Financial Guidelines.

We should all be grateful to Copenhagen University and others who have taken formal (and informal) action against the EC where it over interprets legal texts to add complexity to FP7.

Singleimage - FP7 Training Workshops and Advice

Thursday, 2 February 2012

FP7: costs of participating

The table below shows the costs of participating in the most common types of FP7 project. The table is derived from a survey of 3900 FP7 participants carried out by the EC. Participation costs include both administrative and scientific tasks for all consortium members, excluding carrying out the research. Costs associated with “management and reporting” would be part funded by the EU project, the rest usually not.

Predictably, ERC grants are the lightest in terms of bureaucracy, at 2.3% of the EU grant. Most other projects carry about a 10% bureaucratic on cost. But for R4SMEs, the bureaucratic cost is around 25% of the grant. No explanation for this high figure is suggested.

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