So says a briefing paper written by the European Court of Auditors (ECA). And since they audit the European Commission (EC), they must be right.
The briefing paper was requested by the European Parliament and the Council of Ministers as an input to discussions on FP9, the successor to H2020. As usual, the ECA advocates wider use of “lump sums”: a fixed amount of money given if the proposed work is carried out satisfactorily, as well as unit costs (fixed numbers with limited relationship to actual costs, as used in the Marie Sklodowska-Curie programme) and flat rates, such as the current 25% of direct costs provided as a substitute for overheads. Not surprisingly, all of these produce lower error rates in audits than using actual costs, though they often generate funding for beneficiaries which is lower than actual costs.
But one of the ECA’s observations points in the opposite direction: reducing the rigid interpretations auditors place on the existing legal rules. They point out that auditors sometimes use examples given in the 750 page advisory document “Annotated Model Grant Agreement” as the only acceptable interpretations of the legal rules in the grant agreement and legislation. The ECA says that such examples should not limit the room for different interpretations. Now all they have to do is convince the EC’s auditors!
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