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European Commission

A REFERENCE MANUAL ON PARTNERSHIP PROJECTS

VALID FOR THE SECOND CALL FOR PROPOSALS OF THE KEY INSTITUTIONS PROGRAMME

September 2003

1 KEY TERMS USED

Tacis Tacis is the main means of assistance to promote the transition to a market economy and to reinforce democracy and the rule of law. The latest Tacis regulation was adopted in Council Regulation (EC, Euratom) 99/2000 of 29 December 2000.

NIS Newly Independent States

PC Partner Country(ies). For the purpose of this manual it includes countries covered by the Tacis Programme: Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrghyzstan, Moldova, Mongolia, Russian Federation, Tajikistan, Turkmenistan, Ukraine and Uzbekistan.

MS Member State(s) of the European Union.

CC Candidate Countries

NCP National Contact Point. A designated person in each of the MS/CC and partner countries is the official contact point for all twinning activities.

Practical The Practical Guide to EC External Aid Contract Procedures covers all Guide contracting procedures which apply to EX external aid contracts.

PA Partnership Adviser, who works full-time on the project.

Grant Contractual agreement between the EC and the MS/CC on the Contract Partnership Project. It includes the work plan and standard annexes. Signed by the EC and the MS/CC.

Standard annexes of the Grant Contract are:

Annex I Description of the Action Annex II General Conditions applicable to European Community- financed grant contracts for External Actions Annex III Budget for the Action Annex IV Contract-Award Procedures Annex V Standard request for payment and financial identification form Annex VI Model audit certificate Annex:VII Model Financial Guarantee (not. applicable) Annex VIII Categories and Remuneration of Partnership Experts

Work Plan Legal document developed by the PC and MS/CC, which commits both

2 parties to achieving the results described through the implementation of a detailed work programme.

3 1 TABLE OF CONTENTS

PART A THE GENERAL APPROACH 7 1.2 Key Institutions as an Instrument for Institution Building 8 Section 2: The Components of a Partnership Project 9 2.1 The Fundamental Basis 9 2.2 The Project Leader and Partnership Advisor (PA) 9 2.3 The "Description of the Action including the detailed Work Plan" 13 2.4 Role of the Partner Countries 14 2.5 Role of the Member States/Candidate Countries 15 2.6 Role of the Commission 15

PART B PREPARATION OF PARTNERSHIP PROJECTS 17 Section 3: Process of Project Preparation 18 3.1 Call for proposals 18 3.3 Eligibility of Potential Partners 19 3.4 Member State/Candidate Country consortia 20 3.5 Selection of the Partners 21 3.6 Drafting of the "Work Plan and Budget" 21 3.7 Signature of the Grant Contract and annexes 22 Section 4: Detailed Project Design 24 4.1 Designing the Project 24 4.2 Benchmarks, Timeframes, Duration & Risk Analysis 25 4.3 Deciding Project Management responsibilities 26 4.4 Projects involving a Consortium of MS/CC 27 4.5 Inputs of PC (Staff & Infrastructure) 28 4.6 Inputs of MS/CC (Staff) 29 4.7 Management & Accounting 31 4.8 Translation & Interpretation 31 4.9 Seminars, Training, Traineeships & Workshops 32 4.10 Intangible Inputs 32 4.11 Project Presentation 33 Section 5: The Partnership Project Budget 34 5.1 The Project Budget 34 5.1.1 Global envelope 34 5.1.2 Content of the budget 34 5.1.3 Eligible costs 34

1 Please note that the sections and articles have been chosen in line with the Phare Twinning Manual. However, some articles were not relevant for the Key Institutions Manual as they are covered by the General Conditions and/or the Practical Guide. This explains the occasional gaps.

4 5.1.4 Structure of the budget 35 5.2 Costs arising during the preparation of the Project Proposal 35 5.3 Partnership Advisers 36 5.3.1 General principles 36 5.3.2 Staff Categories and rates of reimbursement 37 5.4 Project Leader, Short & Medium Term Expert Inputs 38 5.6 Travel & Per Diem 39 5.6.1 Travel 39 5.6.2 Per Diem 40 5.6.3. Reserve for adjustment of prices 40 5.7 Training and Seminars 40 5.7.1 Training in the PC 40 5.7.2 Trainee/internships in the MS/CC 41 5.8 Flat rate compensation 41 5.8.1 Principle 41 5.8.2 Beneficiary 42 5.8.3 Budget presentation 42 5.9 Translation and Interpretation 42 5.10 Equipment 43 5.11 Private Sector Sub-Contractors 43 5.12 Costs not covered by the EU 44

PART C IMPLEMENTATION OF PARTNERSHIP PROJECTS 45 Section 6: General Management of the Project 46 6.1 Management by the Project Leaders 46 6.6 Changes to a "Grant Contract" 48 Section 7: Financial Management and Control 49 7.1 General Principles 49 7.4 Private Sector Inputs: tendering, procurement and contracting 51 7.7 Audit 51 Section 8: Other Issues 52 8.1 Languages 52 8.2 Troubleshooting 52 8.3 Acknowledgement of Funding Source 53

5 ANNEXES

D. Templates

D1 Model Project Proposal D2 Standard EU CV Format D3 Letter Mandate Project Leader from Junior Partner D4 Letter commitment PC (in case the Work Plan has not been signed by the PC Authority) D5 Model Work Plan

E. Miscellaneous

E1 Evaluation Grid (Eligibility and Administrative Compliance, Evaluation Grid) E2 Categories and Remuneration of the Partnership Experts

This manual describes the rules and procedures particular to Twinning funded by EU funds. Where no particular rule is specified, the general rules applicable to external actions financed from the general budget of the European Communities apply.

6 PART A

THE GENERAL APPROACH

7 1.2 Key Institutions as an Instrument for Institution Building

The objective of the Key Institutions Programme is to encourage institution building by means of partnership co-operation projects between public organisations from the European Union and the Partner Countries in Europe, Caucasus and Central Asia.

These projects should aim to accelerate the process of administrative reform and to facilitate the design and implementation of public policies based on the experience and practices of public policies of the EU Member States/ Candidate Countries.

MS/CC public administrations have similar roles and missions, and face, in their day-to-day activities, many of the same problems. In many policy areas, such as reform of the judiciary, the fight against economic and organised crime, fiscal reform or the setting up of regulatory frameworks, to cite just a few examples, the expertise that the Partner States require exists mainly in the public sector. This Programme aims to benefit from the experience and know-how within the EU Member States and Candidate Countries.

The Key Institutions Programme is an initiative of the European Commission to assist the PC in their reform of administrative structures in the framework of the Tacis Programme. The Programme is based on the experience on Phare Twinning, which has organised over 300 partnership projects in Central Europe.

 The PC eligible for assistance under this initiative are: Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrghyzstan, Moldova, Mongolia, Russian Federation, Tajikistan, Turkmenistan, Ukraine and Uzbekistan. Secondment of long term MS/CC experts to PC administrations will form the ‘backbone’ of the partnership projects. The long-term experts are called Partnership Advisors (PA). To achieve its objectives, a project will typically also need various other short-term specialist inputs.

The budget available for the Second Round of the Key Institutions Programme is funded from Tacis 2001 and 2002 budget:

2001 2002

Kazakhstan: 0.3 M Euro 0.7 M Euro

Russian Federation 1.0 M Euro 5.0 M Euro

Ukraine 0.625 M Euro 1.5 M Euro

8 Section 2: The Components of a Partnership Project

2.1 The Fundamental Basis

 A Partnership project is not designed to provide only advice or other types of classical technical assistance. It is a complex project in a specific field that must yield results.  A Partnership project is not one-way Technical Assistance from MS/CC to PC. It is a close partnership in which the specific commitment of the Partner Country, which is also the driving force behind the changes targeted, is vital.

 A Partnership Project will not aim at transposing a particular MS/CC administrative system to the PC but rather strive to help introduce EU wide best practices to the PC administration

At the completion of a project, the Partner Country should have developed an efficient, working organisation.

The aim of a partnership is therefore to arrive at a fully operational outcome in a particular field. Achieving this aim calls for long and thorough co-operation between PC and MS/CC, bringing into play whatever actions are required to achieve the desired results.

2.2 The Project Leader and Partnership Advisor (PA)

In all projects, success in delivering a minimum result will depend on the coherence of a number of successive inputs, the continuity of those inputs and steady progress. Every project will therefore include a Project Leader, who continues to work in his/her MS/CC administration but who devotes some of his/her time to conceiving, supervising and co-ordinating the overall thrust of the project. S/he will always be complemented by at least one full-time expert, known as a Partnership Advisor (PA), from an MS/CC to work on a day-to-day basis with the beneficiary in the PC and accompany the implementation of the project.

 PAs will be civil servants or equivalent staff seconded to work and be based in the PC.

9 General Provisions

1. Definition

The present general provisions apply to PAs made available by MS/CC’ administrations and mandated bodies to counterparts in partner countries with EU funding.

The seconded experts covered by these provisions will remain in paid employment in their national administration or mandated body throughout the period of secondment.

PAs must be nationals of a MS/CC.

2. Qualification of Partnership Advisors

To qualify for secondment, a PA must have at least three years’ experience in the organisation of the practical application of the legislative process or other duties as described in the project fiche covering his/her secondment. S/He will have a grade equivalent to Category A as defined in the Staff Regulations for Officials of the European Communities.

A PA should have a good knowledge of one Community language and may be required to have a satisfactory knowledge of a second language where this is necessary for the performance of his/her duties.

A MS/CC may not be in a position to make available statutory civil servants to co- operate with the Partner Country, if the civil servants who specialise in the given field are too few to be spared, or if the MS/CC in question usually entrusts a public service to a private body.

The administrations or mandated bodies of this MS/CC may therefore hire experts for the purpose of the project, provided they have the necessary skills in respect of the relevant legislation/field of the project.

These experts, temporarily recruited by the administration, may only act on its behalf provided they have the necessary experience and are not subject to any conflict of interests. The contract between such experts and the recruiting administration or mandated body must clearly integrate the expert into the contracting organisation, identify the person to whom they report and who is responsible for their backup, thus attributing full responsibility for the quality of their services.

3. Status of PAs

In the host PC, the PA's status is that of a technical expert. If the MS/CC so requests, the PA will be entitled to diplomatic status.

10 4. Duration of secondment

As a rule, PAs are not seconded for more than three years total in any one country. They must serve on a full-time basis throughout the period of secondment.

By way of exception a PA who has already served on secondment may, in response to a reasoned request from a department, be seconded a second time. However, two tours of duty, in the same or different countries, may not be exceeded. Thereafter, PAs must return to their home administration to reacquaint themselves with latest developments and related administrative practice.

The duration of secondment is fixed at the outset in the Grant Contract (annex I). Any change in the duration of secondment specified in the initial project may give rise to a review of the funding approved by the Commission. Such changes are thus subject to an amendment to the agreement, to be submitted to the Commission for prior approval.

5. Breaks in or termination of periods of secondment

The Commission may authorise breaks in periods of secondment and specify the terms applicable. During such breaks:

a) the allowances for housing and removal costs will not be payable;

b) the expenses for health insurance, schooling and personal travel costs will be reimbursed only if the break is at the Commission’s request;

c) any reimbursement of salary to the expert’s employer will be suspended automatically.

The Partner Country and the Member State/Candidate Country may by mutual accord terminate a long-term secondment at any moment, if the PA does not comply with the obligations laid down in the “Grant Contract” or for any justified reason. The termination of a secondment, whether or not there is a substitute for the PA in question, may give rise to a review by the Commission of the funding for all or part of the Grant Contract. Termination of secondments is thus subject to an amendment to the agreement, to be submitted to the Commission for prior approval.

The Commission may, at its own initiative or at that of the Partner Country or the MS/CC alone, propose to review the funding of the Grant Contract, if a PA is not fulfilling his/her obligations to satisfaction, or for any other justified reason. In such cases, the Commission proposes a review of the Contract as a condition for the continuation of all or part of its funding.

6. Duties

PAs will assist the administration or other government body in the Partner Country in the context of a predetermined work programme

11 Unless special instructions to the contrary are given, under the authority of the appropriate person to whom they report, PAs are excluded from any official act whereby the host administration exercises its public law prerogatives. Nor will they enter into a commitment on their behalf, nor commit the Commission to any act compromising the exercise of its public law prerogatives.

PAs may work in any field where their services are deemed necessary according to the Grant Contract, provided there is no conflict with the interests of their administration or mandated body of origin.

A PA will carry out his/her duties and conduct him/herself solely with the interests of the host administration in the Partner Country and those of the EU in mind.

A PA will abstain from any action, and in particular any public expression of opinion, which may reflect on his/her position.

A PA who, in the performance of his/her duties, is called upon to pronounce on a matter, in the handling or outcome of which s/he has a personal interest such as to impair his/her independence, will immediately inform the MS/CC project leader to whom s/he reports.

A PA will exercise the greatest discretion with regard to all facts and information coming to his/her knowledge in the course of or in connection with the performance of his/her duties; s/he will not in any form whatsoever disclose to any unauthorised person any document or information not already made public. S/he will continue to be bound by this obligation after his/her period of secondment has terminated.

A PA will not, whether alone or together with others, publish or cause to be published any matter dealing with his/her work with the host administration in the Partner Country or the EU without obtaining permission in accordance with the conditions and rules in force in the country of his/her assignment. Permission will be refused only where the proposed publication is liable to prejudice the interests of the Partner Country or the EU.

All rights to any work done by a PA in the performance of his/her duties will be the property of the Partner Country in question. The MS/CC and the Commission will be permitted to use the results of the work elsewhere by permission of the Partner Country. Permission may only be refused where the proposed use is liable to prejudice the interests of the Partner Country, or where it is for commercial purposes.

A PA will reside in the place of assignment or at no greater distance therefrom as is compatible with the proper performance of his/her duties.

A PA will assist and tender advice to the representatives of the partner institution in the Partner Country to which s/he is assigned; s/he will be responsible to the project leader of the MS/CC in respect of the performance of the tasks entrusted to

12 7. Working conditions

PAs are bound by the rules on hours of work in force in the host administration. They are not authorised to work part-time.

PAs are subject to the rules on annual leave and special leave in force for National Experts on secondment to the Commission and the holidays in the host administration.

Management and control of leave and working time will be the responsibility of the MS/CC and PC Project Leaders.

2.3 The "Description of the Action" including the detailed "Work Plan"

Annex I of the Grant Contract contains the Description of the Action and the detailed Work Plan. The Description of the Action is the elaborated Project Proposal submitted by the MS/CC. Most projects call for the co-ordinated deployment of a variety of means. These may also include traditional Technical Assistance, in cases where specific expertise can best be provided by private operators, e.g. public information campaigns. For contracting standard practical guide rules must be respected.

The final Annex I includes all actions undertaken by the PC to reform its legislation and institutions, supported by:  full-time long-term secondments of MS/CC practitioners (PA);  missions (short term, medium term) by specialised experts;  seminars, workshops, trainee/internships, training, and training of trainers, ;  intangibles – software, etc;  other services considered necessary to ensure the success of the project.

The Description of the Action details all the actions necessary to achieve the desired outcome, the order in which they must take place and the person responsible for each one. Inputs include work carried out by the PC (e.g. in passing appropriate legislation) and whatever technical assistance, training and know-how the MS/CC may provide. Most emphasis should be placed on the reforms to be introduced by the PC, which will be crucial to the success of the project and the achievement of the desired outcome. Accordingly, preparing the final Description of the Action will depend on finding the necessary outside know- how and, still more, on making a realistic assessment of the PC's capacities and commitment to reform.

For example, introducing VAT in a country where it does not yet exist requires the development, introduction and enforcement of legal and fiscal legislation and rules

13 for company accounts and invoicing. It also requires suitably organised tax and treasury departments, appropriate administrative computerisation, with new software, specialised training for the public servants that will have to make the system work, and a general information programme for the public.

None of the actions undertaken within a work plan can be considered an end in itself. They will not be funded through a project unless they serve a specific purpose and directly contribute to achieving the required outcome.

2.4 Role of the Partner Countries

A Partnership project makes only sense if the PC is fully determined to carry out the reforms and reorganisation needed to lay the foundations for sustainable public administration reform.

The PC is committed:  to the implementation of project to achieve the results required. This commitment includes both high level political commitment and a more practical commitment of PC human and financial resources.

For each project, the PC concerned must contractually commit itself to achieving the results required. The formal commitment made by a PC will be in the form of the development of the detailed "Description of the Action including the Work Plan" with the MS/CC what will be included in the Grant Contract. This constitutes the contractual framework for implementing the Partnership project and specifies the obligations of both the MS/CC and PC.

The "Description of the Action" is therefore more than just a list of the services to be provided by one or more MS/CC to the PC. It must also, and primarily, set out the domestic tasks, which will, throughout the process, enable the PC's agencies and departments to reform, or even create, themselves. The PC must therefore include in the "Description of the Action" the details of the departments or bodies concerned, the official(s) responsible for the changes to be made and for achieving the desired outcome, availability of appropriate office space and logistic, the budgetary resources to be mobilised and the timetable for the work it will itself undertake at each stage of the project's progress. This domestic planning and preparation is crucial to the absorption of the MS/CC's contributions and the programme's smooth and uninterrupted progress.

14 2.5 Role of the Member States/Candidate Countries

A Partnership Project relies entirely on the efficient co-operation of MS/CC with their counterparts in PC.

 MS/CC involved in a project must contractually commit themselves to achieving the results required; The formal commitment made by a MS/CC will be in the form of a “Grant Contract". This constitutes the contractual framework for implementing the Partnership project and specifies the obligations of both the MS/CC and the PC. The "Grant Contract" will be signed by the Commission, which will provide the financial resources for the MS/CC's contribution to the project.

MS/CC National Contact Points

Each MS/CC has a NCP for Institution Building activities. This individual has an important role in the development and co-ordination of the activities. One of the main features of his/her work will be the channelling of information to all relevant Ministries, agencies and other relevant bodies in the MS/CC, and advising them on the development of the Partnership projects. His/her role in facilitating the sharing of information is vital.

Specifically, the MS/CC NCP has the role of:  The central point of communication between the Commission and the MS/CC. Also the central contact point for other PC and MS/CC NCPs;  Channelling information to MS/CC Ministries and other relevant bodies, and advising them on the process and development of Partnership projects;  Co-ordination of administration of all Partnership activities in the MS/CC and resolving any common administrative obstacles;  Assistance in case of problems in the negotiation of consortium agreements between MS/CC;  Filtering project proposals prior to submission to the Commission;  Attending Commission meetings with other PC and MS/CC NCPs.

2.6 Role of the Commission

Activities to establish the framework for Partnership projects will be carried out by the Commission centrally in Brussels. The Commission will use the network of NCPs in the MS/CC to develop this framework and disseminate information.

15  Organising the process of selecting MS/CC partners;  Co-evaluating proposals  Advising the partners in designing relevant Description of the Action including Work Plan;  Checking that the detailed project meet the required standards;  Agreement of funding via signing of Grant Contract;  Monitoring and evaluation projects.

16 PART B

PREPARATION OF PARTNERSHIP PROJECTS

17 Section 3: Process of Project Preparation

3.1 Call for proposals

Once the Project Fiche or Fiches are ready for distribution, the MS/CC’s National Contact Points will receive the Fiches.

It is up to the National Contact Points to circulate the Project Fiches among their ministries or institutions and to co-ordinate a response.

The offers made by the MS/CC are expected to show a certain degree of preparation.

At this first stage, in response to the project fiches, offers should follow the format in Annex D1. This must include certain information as a minimum for the offers to be accepted, e.g. outline the proposed actions and include at least the CVs (in EU Format, Annex D2) of the Project Leader and the PA and the main experts.

The following is required for a submission of a Project Proposal:

 relevance of the MS/CC experience to the issues described in the Project Fiche;  a suggested strategy for how the project can be implemented;  confirmation of the availability of a Project Leader and PA (including CVs in EU format) to draft and implement the project;  the reference code of the Project Fiche;  complete contact details of the administration making the proposal and the relevant individual officials involved.

The proposal made by the MS/CC should be described in a concise document (with the emphasis on quality not quantity). In general terms, the proposal should be detailed enough to respond adequately to the Project Fiche. It should explain the key points of the approach of the MS/CC.

Detailed budgets are not expected at this stage.

Note that MS/CC, which submit incomplete proposals (without PA or addressing only part of the scope of the project) will only be considered if another MS/CC has submitted a full proposal including a PA, prepared to take the lead of the project.

Project Proposals should be sent through the National Contact Point to the project manager in EuropeAid Co-operation Office.

18 3.3 Eligibility of Potential Partners

The general rule is that the MS/CC "Partner" is headed by a competent public administration, even if some specific items may be handled by private subcontractors. Any MS/CC administration is automatically eligible as a partner. This refers to national and regional administrations, if the area of the Project Fiche falls into their competence.

However, a MS/CC may propose, and the Commission may accept, that non- administrative bodies be mandated to implement Partnership projects according to the same conditions as if they were part of the administration.

The NCP puts forward to the Commission an initial open-ended list of non- administrative bodies to be mandated to act in lieu of public administrations. In addition, non-administrative bodies may be suggested for mandate in the context of a specific Grant Contract. These requests will be considered on a case by case basis. project proposals must be justified and satisfy the criteria.

The Commission alone may accept or refuse proposals.

The reasoning behind assimilating certain non-administrative bodies to administrations is that some MS/CC have or are in the process of outsourcing and privatising parts of their administration. The know-how required for Partnership projects is therefore sometimes located outside the administration proper. In order to tap it for the purpose of the Partnership, this is the arrangement, which allows for direct contracts without distorting competition.

The Commission has set four qualifying criteria for mandated bodies:

1) proven competence in a Twinning-relevant field, 2) non-profit organisation, non-commercial business purpose, 3) public ownership and 4) under the supervision of an administrative body.

In some cases where criterion 2 and/or 3 are only partially fulfilled, the mandate is restricted subject to an exclusion from commercial tenders in the direct follow-up to the Partnership project. The following applies as a general rule: "…some bodies may nevertheless be mandated to implement "Grant Contract" in lieu of a public administration in certain areas, provided that mandate does not in any way distort competition, i.e. confer onto the body any direct or indirect, immediate or ulterior commercial advantage. In application of this principle, the Commission may make its approval of funding conditional on a clause temporarily restricting the mandated body's commercial activities. Those restrictions will not, however, apply to administrative co-operation and technical assistance activities with public administrations."

Mandated bodies involved in Partnership projects are thus in principle not excluded from providing TA under commercially tendered contracts. They must however be excluded from tendering commercially for follow-up contracts to the Partnership projects, if their involvement gives them a commercial

19 advantage. They are also excluded from making a proposal for a Partnership project where they have been involved in drafting the project fiche or terms of reference.

Mandated bodies must be approved by Commission headquarters before presenting proposals. The Commission cannot guarantee financing of the project, if a PC selects an institution which is not yet included in the list. If a mandated body wishes to apply for approval of fees other than the rates published in this manual, this too, must be approved before selection.

In other words, only mandated bodies approved by the Commission (HQ) are eligible partners in Partnership projects under the Key Institutions Programme, and their experts may only charge the standard fees or the approved rates, published in the list.

Normally the same list of mandated bodies will apply for Phare and Tacis Twinning. In the case where, due to the difference between the programmes, a mandated body will be eligible for Tacis only, this body will be added to a Tacis mandated body sub list.

3.4 Member State/Candidate Country consortia

It may be desirable for more than one MS/CC to be involved in a project. This could be decided prior to the original proposal submission (joint proposal). It could also be decided during the selection process, the PC may wish to diversify its exposure to experience by requesting the involvement of one additional MS/CC. In that case, the PC should ensure that the chosen MS/CC are prepared to enter into a consortium and work together, before confirming its choice.

The provisions hereunder for MS/CC states will thus mutatis mutandis apply to the partners involved in the Project Proposal.

The Commission is positively disposed to more than one MS/CC being involved in any partnership project, with a view to forestalling the temptation of simply copying a MS/CC system and providing opportunities for MS/CC with less experience of administrative co-operation to participate in the project.

Experience has shown that large consortia generate management problems and high costs at the expense of the potential value added. Generally, no more than two MS/CC should be involved in a project; only exceptionally and subject to detailed justification will the Commission agree to provide funding for consortia of up to three MS/CC.

Only a MS/CC prepared to commit itself at an institutional level (administration or mandated body) to implementing part of the project under its own responsibility, subject to overall co-ordination by the lead MS/CC, is considered a full partner in a consortium and will be mentioned in the statistical overview.

20 If an administration or mandated body from any MS/CC simply provides an expert for ad hoc participation in the project, without taking responsibility for his/her activities, that institution or body is not a partner and is not required to sign a mandate. In this case, the expert provided contributes to the project under the authority and the responsibility of the Project Leader. It is the Project Leader’s responsibility to ensure the availability of the expert and to define the details of his involvement.

The agreement of a consortium to prepare and deliver a project will raise important practical management issues, even at the project preparation stage. It is vital that partners agree a clear division of responsibilities and establish efficient channels of communication to maximise their efficiency in preparing and implementing the project.

3.5 Selection of the Partners

The Commission (Europe Aid Co-operation Office, Unit A3) registers the proposals received from the MS/CC interested in participating in the project.

All MS/CC are then informed of the number of proposal received by which countries.

For each Project Fiche, MS/CC institutions (administration or mandated body) making a proposal may do so only once, i.e. either individually or as a participant in one specific consortium. Simple expressions of interest are not a satisfactory response to a project fiche; MS/CC proposals should follow the template provided in annex A1.

It has to be noted that there is no pre-selection by the Commission. The choice of the partner is left entirely to the Evaluation Committee.

The procedures followed are in line with those described in the Practical Guide.

3.6 Drafting of the "Work Plan and Budget"

Once the choice of the partner(s) has been made by the evaluation committee, it is entirely the duty and responsibility of both partners (MS/CC and PC) to draw up the detailed work and time schedule, with a corresponding budget. The Commission will provide advice and a standard templates.

It is important that the "Description of the Action and the Work Plan" reflects a clear strategy, linked to measurable benchmarks/milestones, in pursuit of the targeted result, rather than being drowned in minute details.

21 In brief the elements of a Partnership project are:

 a long-term seconded expert (PA);

 a Project Leader with an overall appreciation of the problems and possible solutions, capable of unblocking any problems at highest level;

 short and medium-term expert visits; training, seminars, traineeships in MS/CC, on-site visits, design of software, etc.

 The "Description of the Action and the Work Plan" should detail the relevant organisation and methods, including work- and time schedule, a precise division of tasks between the partners, and a detailed breakdown of costs.

3.7 Signature of the Grant Contract and annexes

Signatories of the Grant Contract

The Grant Contract will be signed by:

 on behalf of the Commission by the EuropeAid Co-operation Office;  on behalf of the MS/CC, the person in the administration or entitled body responsible for the implementation of the MS/CC’s obligations in the project, and by a person representing a binding commitment by the government (administrative authority).

Who signs what?

Signs MS/CC Junior Partner Commission Partner (MS/ Country CC)

Grant X X Contract

(Special Conditions)

Annex 1 X X X (Work Plan) (or official letter of

22 (signed, commitment stamped and to the dated) project)

Mandate X given to lead MS/CC

(signed, stamped and dated)

People, who may be able to bind the government (administrative authority) concerned would be a senior official authorised to sign on behalf of the government, the NCP (for the Member States/Candidate Countries) or the Ambassador to the EU.

If a project is entirely under the responsibility of a decentralised public authority (Land, département or region), it may sign instead of a central administrative authority, subject to approval by the central authorities (e.g. represented by the NCP for the Member States/Candidate Countries).

Signatories in the case of a MS/CC consortium

Where MS/CC have formed a consortium to implement a Partnership project, the MS/CC signatories to the Agreement will be from the MS/CC which has been designated as Project Leader.

 The Commission will require a general mandate (see Annex D3) from the other MS/CC partners to the Project Leader, which gives the Leader the power to commit their administrations and take any project implementation decisions on their behalf.

In addition to the general mandate, the MS/CC in the consortium will also need to reach agreement on detailed working arrangements and will define these in an intra-consortium agreement. The Junior Partner will be required to sign the Work Plan along with the lead MS/CC and the PC.

The PC can provide an official letter of commitment to the Work Plan and Staff Input or sign the Work Plan (see Annex D4).

23 Section 4: Detailed Project Design

4.1 Designing the Project

Drafting the "Description of the Action" is a joint MS/CC - PC exercise. The "Description of the Action" consists of the elaborated Project Proposal (the document submitted by the MS/CC) and a detailed Work Plan. The document consists of a sequence of activities, attributed to the one or other side, that together constitute a strategy aimed at achieving the result.

The "Description of the Action" including the "Work Plan" should be drafted in English.

The starting point in designing a project is to define more precisely the results targeted.

The result required will have already been set out in the project fiche. However, in developing the "Description of the Action" and the "Work Plan", the output may need to be fine-tuned as the PC and MS/CC make a detailed assessment of what is realistic and deliverable within the timeframe and budget available, also taking into account the progress made since the fiche was drafted.

 The output (results) of the project must be well defined, focused and achievable;  The result must be clearly measurable for control purposes.

Breaking the Project into components

Given the size and complexity of projects, it will always be necessary to break the project down into different components with specific outcomes (milestones/benchmarks) which contribute to the achievement of the overall result.

The project must clearly identify these sub-components and the steps needed to achieve them. This includes all sub-components, which are necessary to meet the overall project objective and therefore includes components, which are the sole responsibility of the PC. Since a Partnership project does not take place in a vacuum, account should be taken of other activities taking place in the PC, which may assist with, overlap with, or hinder the project.

All components of a project must be clearly and independently identified;  Each component (benchmark) and the actions identified to achieve the component must be fully justified in the context of achieving the overall result;

24 4.2 Benchmarks, Timeframes, Duration & Risk Analysis

Setting Project Benchmarks

There should be milestones/benchmarks for the Partnership project as a whole and also benchmarks within some of the larger components of the projects, which require a long time period to complete. Setting these benchmarks will assist in reaching the final result and in general good project management. Achievement of benchmarks will also be an important part of the regular monitoring and reporting procedures, which will normally take place at 3-month intervals.

 The Description of the action must specify benchmarks at regular time intervals, which will be used to measure progress.

Examples of project benchmarks could be, e.g. in the context of establishing a national body for managing agricultural policy: the adoption of a bill by the government; a vote by parliament; adoption of the body’s rules of procedure; final choice of premises; availability of computers etc.

Timeframes

Careful consideration should be given to timeframes. Each component of the project must have an allocated timeframe for completion. This can then be used to set the overall timeframe for the project. Some of the project components can be completed concurrently. Others will rely on the prior completion of another project component.

 The "Work Plan" must clearly identify timeframes for the project as a whole and for all project components;

 It is recommended to allow a minimum of one month for the installation and orientation of the PA, before scheduling short term activities

Duration

The duration of the project must be longer than the duration of the Work Plan. The starting date of projects is the determined by the signature of the Grant Contract. In the vast majority of cases, the PA will not arrive in the PC immediately and the work programme will only kick in, once s/he has been in place for a few weeks. It is therefore recommended to add ca 2-3 months to the duration of the work plan for the duration of the agreement.

The end of the project must comply with the requirements of the deadline for disbursement of the Financing Memorandum, under which the project is funded, leaving at least 2 months for final invoicing and payments.

25 Risk Analysis

There will always be risks involved in a project, however well it is designed. These risks may range from small risks of time delays or cost overruns to more fundamental risks of, for example, passing the appropriate legislation through parliament, change of government policy, etc. Some of the risks will be internal to the project and therefore subject to a certain degree of control. Internal risks might include, for example, the possibility that monitoring equipment, vital to an environmental standards project, is not provided on time, and thus delays implementation of the entire project. Other risks such as political risk will be entirely outside the scope of the project.

 All significant risks, both internal and external, should be clearly stated and quantified as far as possible;  The project should also identify ways of minimising controllable risks.

4.3 Deciding Project Management responsibilities

Between the PC and MS/CC

The "Description of the Action" is an agreement between two parties, the PC and the MS/CC, which together commit themselves to achieving a guaranteed result. The project must therefore be carried out under the responsibility of two Project Leaders, one from the PC and the other from the MS/CC. Each will be responsible for the activities assigned to him/her in the Agreement, with full authority over the human and material resources mobilised to that end. More specifically, the PC's Project Leader will be responsible for experts from the PC and the MS/CC's Project Leader for experts from the MS/CC.

 The split of responsibilities must be defined for each component;  For components which are a joint responsibility, the Agreement should state which party is the leader;  Attribution of responsibility for a particular activity must be directly linked to entitlement to an explicitly identified budget allocation.

A useful instrument for ensuring good co-ordination is a project Steering Committee. The more actors that are involved (MS/CC consortia and/or different PC ministries), the more such a mechanism is likely to be useful and necessary and should be foreseen in the agreement.

Management Hierarchy for MS/CC Inputs

In all projects, overall responsibility for MS/CC involvement is held by the MS/CC Project Leader who may delegate the management and implementation of project components. For example, the Project Leader is likely to delegate

26 accounting and invoicing tasks, the organisation of training seminars, the preparation of training documentation, etc.

The PA(s) will report to the MS/CC Project Leader.

Where more than one MS/CC is involved, the Project Leader from the lead MS/CC takes overall responsibility on the MS/CC side for the entire project. However, the MS/CC Project Leader may delegate responsibility for particular project components to another MS/CC, but retains overall responsibility to the PC and the Commission for the project. Examples might include hosting PC trainees, running a seminar, assisting the PC in drafting legislation. The PC will always have the last word on the delegation of tasks to partner MS/CC.

Responsibility of the Commission

The Grant Contract is a contractual arrangement between the Commission and a Member State/Candidate Country.

For its part, the Commission is responsible for funding of part of the costs arising from the implementation of projects. It fixes the priorities for funding, facilitates the selection of partners, lays down the conditions for obtaining financing and checks that funds have been used properly (through monitoring, reporting, evaluation and auditing). The Commission exercises this responsibility throughout the launch and execution of projects.

However, it is not directly involved in the management of projects.

4.4 Projects involving a Consortium of MS/CC

Practical Project Considerations

Where more than one MS/CC have decided to work together in a consortium, the management of the project clearly becomes more complex. There are a number of practical issues that should be considered when drafting the Agreement and preparing for project implementation. PC partners will have a major interest in assuring themselves that consortium members are both willing and, in reality, in a position to co-operate fully to achieve the target results.

 The "Description of the Action" must detail the responsibilities of each of the partners in respect of the individual project components clearly stating who should do what, when and with which resources (as identified in the detailed breakdown of costs).  The Commission requires a general mandate from the junior MS/CC partner to the lead MS/CC Project Leader providing the power to commit its administration and take any project implementation decisions on its behalf. The signature of this mandate is a pre-condition for submitting the agreement to the Steering Committee.

27 Over and above the mandate from MS/CC partners to the lead MS/CC, the MS/CC involved in a consortium will need to draw up an intra-consortium agreement. It is the MS/CC’s prerogative to define the details of their co-operation. As a minimum, the agreement is likely to cover the following main points:

- financial matters, especially arrangements for the transfer of funds between consortium members in respect of reimbursable expenditure and a proportion of the flat rate compensation. Generally, the lead MS/CC partner retains a proportion of the flat rate compensation to cover the costs for its leadership; - lines of communication which will guarantee sharing of information and the coherence and co-ordination of activities; - procedures for decision-making, i.e. which decisions will be taken by consensus, which matters can be left to the lead MS/CC.

4.5 Inputs of PC (Staff & Infrastructure)

Success of all projects will require significant input of PC resources coupled with a commitment to achieve results.

Staff Inputs

Significant staff time will be required in the various components of the project:  At the broadest and most senior level, there must be political commitment and support within the PC administration for the Partnership project as a whole. His/her signature of the Work Plan or the letter of commitment embodies this political commitment and support;  Each Partnership project must have a PC Project Leader with sufficient authority to administer and properly implement the project in practice. This person will also be named in the project and Work Plan as the figure ultimately responsible for its implementation;  At project level, PC staff will actively participate (i.e. working with the PA and other short term experts, participating in training activities) to implement a particular project component.  PC staff inputs should be detailed as far as possible within the Work Plan to ensure that there is full recognition of both the practical and political commitments required to achieve the desired results.  A change in PC Project Leader or PA counterpart must be notified in writing.

Infrastructure Inputs

The PC will be required to make available the necessary infrastructure for MS/CC partners to carry out their tasks. This includes the provision of office space, the provision of equipment (including access to a computer, telephone, fax etc) and the professional use of that equipment.

28  All infrastructure requirements should be specified in the "Grant Contract";  Only a small provision for miscellaneous supplies may be eligible for EU funding. This will only be available in very restricted cases, subject to evidence of PC inability to provide the material required.

4.6 Inputs of MS/CC (Staff)

Staff Time

In support of the PC's own efforts to implement a Partnership project, the principal input of the MS/CC is the staff time. This includes the time of the Project Leader, PA(s), short and medium term advisers and other staff involved in managing and accounting for the project. The "Description of the Action and the Work Plan" should state how much time will be devoted to each component of the project.. The different categories of MS/CC staff input are :-

Staff Input Function/Knowledge Time Allocation Project Leader Overall conception and direction It is recommended that a of the thrust of MS/CC inputs. minimum of 3 days per Must have a broad knowledge of month including one visit all processes in the area of the every 3 months (more for Project Fiche concerned, and good complex projects) is leadership skills. allocated. PA(s)* Works on a daily basis with PC Full time in the PC staff to implement project, support and co-ordinate activities in PC. Ensures continuity of implementation. Must have good general knowledge of the sector. Short/Medium Term Officials or assimilated staff with Varies. Specified by number Experts specialist knowledge working on of days. specific project components. Includes specialist support services e.g. providing PC with access to databases. Logistical Management Work in MS/CC in support of the Not specified, covered by flat & Accounting project. rate compensation

* It is advisable for the work plan to foresee a period of 2 to 4 weeks at the beginning, during which the PA is given a chance to acquaint himself with his/her new working environment and sort out his/her practical living arrangement.

Staff Know-How

Clearly the staff selected to deliver project actions must have the relevant skills, knowledge and experience in order to carry out their tasks.

29 The Project Leader should be a high-ranking official commensurate with an operational dialogue at vice-ministerial level. The Project Leader's seniority will ensure his/her ability to call on short term experts in support of the efficient implementation of the project and the full support at senior levels within the PC. The Project Leader is not an advisor; s/he directs the implementation of the project.

There will normally be a trade-off between seniority and the time available for the project. The project leader may not be able to devote a significant amount of time due to other obligations. A minimum has been set at 3 days per month with an on- site visit at least every 3 months; more complex projects will require longer attention.

The PA requires a good and preferably broad basic knowledge of the field, with particular emphasis on implementation and institutional set up. Comparative knowledge of other MS/CC systems, as well as good management, communication and language skills are an asset. The contribution of specialist knowledge can be brought by the project leader and/or short term experts.

There will be a balance to be struck – the profile of the PA should be evaluated in conjunction with that of the rest of the team (especially the Project Leader); lack of experience of a PA could be compensated by the quality of the team as a whole.

 All key staff, including the Project Leader, the PA, and the principal short and medium term experts must provide a full CV (in EU Format), which will be integral part of the Project. The profile of the other experts should appear in the Project document.

Change of Project Leader or Partnership Advisor

Should the situation arise where the MS/CC Project Leader or PA is to change, the agreement is to be amended.

Staff Origin

MS/CC administrations or mandated bodies are chosen as partners by the partner countries for their specific knowledge and administrative systems. The human resources they make available to their PC partners must therefore be fully integrated with the MS/CC partners. In consultation or at the request of the PC, experts from other MS/CC not contractually associated with the project may be asked to provide their expertise on an ad hoc basis and under the responsibility of the MS/CC, which has requested the participation. That MS/CC is responsible for the skills and availability of the expert and defines the conditions and details of his/her involvement.

PAs must be nationals of an EU MS/CC.

30 4.7 Management & Accounting

As well as the more general project management responsibilities, for each project there needs to be a support system in place. It is expected that there will mainly be two functions that will be carried out by an individual or individuals in the PC and MS/CC administrations or possibly outsourced to a contractor (public or private). Note that the PA should not be responsible for these tasks, s/he should focus on the substance of the project.

The first function is to deal with logistical management of the project. This may include making travel arrangements and providing general organisational support to the Project Leader, as to all short- and medium-term experts. It also includes inter alia the practical organisation of seminars and study visits.

The second function is financial management. This includes the accounting of expenditure, invoicing and management of project funds. In the case of a consortium, the management tasks of the leader are increased and the partners have to provide a minimum of management support.

The costs of carrying out these functions are covered by the flat rate compensation for work performed elsewhere than the PC.

 PC and MS/CC administrations will be entirely responsible for their respective part of the general management, logistical and financial management in relation with a Twinning project;  The requirements for logistical and accounting support should be clearly taken into account by the MS/CC preparing the "Description of the Action and the Work Plan.  PA's will be expected to manage their own allowances and claims for statutory reimbursements.

4.8 Translation & Interpretation

Language/project assistant for the PA

To facilitate the work of the PA, experience has shown that a full time assistant (PC national) who deals with both translation, interpretation and other general project issues on a daily basis is essential. Provisions must be made in the Agreement for this cost. The resulting costs form part of the main project costs, and are comparable to expenditure on other services.

A PC might want to consider “seconding” the project assistant from their own administration rather than recruiting a new one. In that case, salary costs will not

31 be covered by the budget of the Partnership Project. The advantage of this solution is to have a project assistant with ‘in house’ knowledge rather than an outsider.

Translation

In designing a project, the need for translation should not be overlooked. These needs include translation of relevant supporting documentation. They may also include tasks such as translation of training materials.

Interpretation

Provision should also be made for the need for interpretation for seminars, key meetings or other project activities. It is recommended that local resources should be used for cost reasons. If the volume of interpretation is considerable, the option of concluding a framework agreement should be considered.

4.9 Seminars, Training, Traineeships & Workshops

Classical training activities may be a necessary part of a Partnership project. These may take the form of seminars in the PC or elsewhere, if justified. They may also take the form of trainee/internships, i.e. giving PC officials the opportunity to spend time and work in MS/CC administrations. There may also be other types of training courses (e.g. intensive highly specialised courses delivered by dedicated training institutions, provided that such training is imbedded into the overall reform strategy) or workshops on particular specialist subjects.

Normally traineeships in MS/CC will be reserved for a small number of PC specialists and limited in time (3-5 months). Seminars will normally be held in PC where they can reach a larger number of participants at lower cost.

Like other project components, training activities (including study visits) must be fully justified by directly contributing to the achievement of the overall "guaranteed result". This means for example that basic language training is unlikely to be justified although specialist language training could be. Certain training costs will be eligible for funding by the project whilst others will remain the responsibility of the PC. The project design should also take account of training activities already being supported by the PC and others outside of the Twinning project.

4.10 Intangible Inputs

The continued success of a Partnership project may greatly benefit from a number of intangible inputs. For example, connection to MS/CC or other databases, integration into international organisations or networks, provision of specialist written materials or software etc.

32 4.11 Project Presentation

Project Substance

 Project components, benchmarks, timetables and budgets must all be explicitly defined in a logical manner, with cross-references – it is preferred if all of these elements are combined into a single schedule.

Supporting Documentation

 CVs (in EU format) of the PA, both Project Leaders and other main experts must be attached;  Justification of PA's base salary should be attached;  Mandate from partner MS/CC to the lead MS/CC.

 Letter of commitment of the PC if they have not signed, stamped and dated the Work Plan

Practical/Technical Points

 The Work Plan must be initialled by the MS/CC and PC (otherwise letter of commitment should be provided);  The Project document and Work Plan and Budget must be submitted in English;  The Project Document must contain full and updated contact details of the individuals directly involved in producing the document from the MS/CC;  Agreements should be clearly dated and paginated.

33 Section 5: The Partnership Project Budget

5.1 The Project Budget

5.1.1 Global envelope

The overall budgetary envelope for a Partnership project is determined in the Project Fiche.

5.1.2 Content of the budget

The budget is annex III to the Grant Contract.

All activities foreseen in the framework of the project, irrespective of whether they are carried out under the responsibility of the applicant country or of the MS/CC, should be listed.

Only listed activities will be financed by the Commission. Each activity should indicate the partner that will execute the activity.

5.1.3 Eligible costs

The following is a non-exhaustive list of costs, which may be funded by the envelope allocated for the implementation of Partnership projects. They are eligible for submission for funding to the Commission and may be charged against EU funds earmarked for that project. Each category will be described in more detail in the following chapters of this section.

 Partnership Advisor: full-time secondments for long periods to the PC of MS/CC Partnership Advisers (one per project).

 Project Leader and short- and medium term experts: Project Leader who has overall responsibility for the project; Tasks requiring the assistance of highly specialised experts will be accomplished by carefully scheduled one-off or repeated missions of short or medium duration.

 Supplies and services: Partnership projects often need intangible supplies vital to the working of the new system, and services (translation, data exchange, access to networks, etc).

 Travel expenses: MS/CC staff travel will be reimbursed and they are entitled to per diem allowances. The budget should include a reserve to cover fluctuations in prices and per diem rates. PC Staff travel will, in certain cases, be

34 reimbursed (international travel to MS/CC for seminar/training/study missions, etc.)

 Training: Training in the application of new systems for the PC staff who will operate them. This will take place mainly in the PC, but may also include trainee/internships (limited in number and time) in MS/CC administrations or professional or other organisations to which MS/CC have delegated institutional functions. Where necessary, the project will include training for trainers.

 Activity-preparatory and follow-up work outside the PC, management and accounting: costs incurred by MS/CC in managing the project, after signature of the "Grant Contract" (this is not to be confused with costs incurred during the preparation of the proposal prior to the selection of a MS/CC for a project)

 Translation and interpretation costs.

Any other category of MS/CC input (other than equipment) may be submitted to the Commission for assessment.

5.1.4 Structure of the budget

The basic building blocks of the budget are a) human resources. (Project Leader, Partnership Advisor Partnership Advisor Assistant etc.) b) travel c) equipment and supplies, only possible in exceptional well documented and justified cases that small sums for equipment will be funded through the Key Institutions Programme. d) other costs for services e) Subcontracts to the private sector f) Administrative costs

5.2 Costs arising during the preparation of the Project Proposal

Under the new Financial Regulations adopted by the Member States 25 June 2002 a Grant Contract requires co-financing.

35 Preparatory costs incurred during the preparation of the "Description of the Action (including the Work Plan)" and the "Detailed Budget" are to be added up to the total budget of the Partnership Project indicated on the Project Fiche. This amount will be presented as co-financing from the MS/CC to the Partnership project.

5.3 Partnership Advisers

5.3.1 General principles

The PA will continue to be paid his/her normal salary in the MS/CC concerned throughout his/her secondment.

The EU programme reimburses the payroll institution of the PA an amount equivalent to what s/he would have received had s/he continued to work in his/her home administration (not abroad), including related and/or connected non-wage labour costs, plus an additional 6% of the whole amount to cover the extra cost of a replacement. The amount for reimbursement must be included in the detailed breakdown of costs, and must be based on evidence that it has been calculated according to the principles laid down in the Framework Agreement between the Commission and the MS/CC.

Other costs arising from the PA's secondment, be they allowances or statutory reimbursements, are borne by EU funding according to a scale applying to all MS/CC. They include a subsistence allowance and reimbursement for housing, health and accident insurance, school fees, travel and removal costs.

During his/her period of secondment, a PA may be sent on mission to a place other than his/her place of duty. Mission expenses are reimbursed in accordance with the rules for short term mission (per diem and travel costs), without any additional expert fees. In the breakdown of costs these expenses should be indicated in the budget section related to the activity which triggers the mission, and not in the section related to the PA’s long-term secondment.

Expenditure on the provision of working facilities (offices, furniture, computer, telephone, fax, etc.) for the PA will be the responsibility of the host administration in the PC.

All costs related to the PA must be quantified and included in the project budget.

PA may exceptionally be asked to share their experience as a short-term expert (maximum 1 week) in another PC Twinning project. Such participation is subject to authorisation from the project leaders (MS/CC and PC). Their basic salary, allowances and reimbursement of costs continues to be funded by the project for which they act as a PA. The project hosting the short-term mission will provide for travel and per diem (and insurance where required) expenses, no additional fees may be charged.

36 5.3.2 Staff Categories and rates of reimbursement

Employment status and corresponding rate of reimbursement

1. As a rule, MS/CC experts (PA and experts undertaking short and medium duration missions) will be statutory civil servants.

2. For PA’s emanating from a mandated body, the reimbursement of salary will be based on the person's actual salary plus non-wage labour costs, without any profit margin.

3. Temporary public employees may be hired by MS/CC administrations or mandated bodies, if there are not enough civil servants available to act as experts in Twinning projects. If they are contracted by an administration, reimbursement for their remuneration will be the same as for a statutory civil servant of comparable competence and seniority.

If a mandated body contracts them, reimbursement will be based on the rate for a comparable expert from the same body.

4. Recently retired experts (maximum two years) may be reactivated as temporary public agents, either by administrations or mandated bodies. Like non-statutory civil servants, they must be linked to the body responsible for a project by a contract. Reimbursement for their salary will be based on the above principles for temporary public employees.

Where national legislation provides for deduction from a public sector salary of the pension amount, the project will only reimburse actual salary expenditure of the contractor.

37 5.4 Project Leader, Short & Medium Term Expert Inputs

Missions of civil servants

The EU will finance the cost of short and medium term MS/CC missions in the framework of the project. The contribution of each short or medium term expert to project activities must be specified in the Project document and Work Plan and Budget.

Mission expenses (transport, per diem, etc) will be reimbursed in accordance with the standard EU rules. The financial contribution of the EU programme to the staff costs of short and medium-term missions is 200€/day for civil servants or acting civil servants:

Missions of staff from mandated bodies

DEFINITION OF THREE EXPERT CATEGORIES AND THEIR RESPECTIVE RATES OF REIMBURSEMENT

Detailed conditions and reimbursement rates can be found in Annex VIII of the Grant Contract.

Practical Points

NB: When calculating the costs for short and medium term staff inputs, it is important to budget for the appropriate unit number of daily allowances. For example:

 2 weeks: if expert A comes to the PC on Sunday and leaves on Saturday, 10 working days in the PC and 13 per diems should be budgeted.

 1 week: if expert B comes on Sunday and leaves on Friday, 5 working days and 5 per diems should be budgeted.

 1 week: if expert C comes on Sunday and leaves on Saturday, 5 working days and 6 per diems should be budgeted.

The working days invoiced will be equal to the days actually spent on co-operation (excluding travelling time and weekends). The per diems, on the other hand, will correspond to the number of nights spent on the basis of the actual arrival and departure dates, adjusted to meet working requirements. If the use of a reduced rate air fare requires an additional overnight stay, the traveller is entitled to the corresponding per diem payment, provided it is not in excess of the saving on the air fare.

38 Inputs in the MS/CC Home Administration or mandated body

For tasks performed outside the PC for the benefit of the Partnership project by MS/CC civil servants or mandated body experts, the financial contribution to the home administration or mandated body will be the flat rate compensation.

5.6 Travel & Per Diem

5.6.1 Travel  The basic rules for travel are: economy class air fare or first class train ticket, whichever is more appropriate and economically advantageous  Travel by car is reimbursed according to the basic rules above, except where neither air nor rail transport is available or appropriate. In that case, it is reimbursed at a rate of 0.25 Euro/km, regardless of whether the car used is private or rented or a taxi.  Travel costs are always considered to be reimbursable costs, estimated in the budget and invoiced at actually incurred rate.;  The only exception is the monthly travel ticket allowance paid to PAs under some circumstances (see Annex E6) which is calculated at the beginning of the project and is automatically paid monthly without proof of travel.

For travel by plane the cheapest possible tariff should be applied. If an overnight stay between a Saturday and Sunday is possible, the use of PEX or APEX tickets is mandatory. If several trips are scheduled, the possibility of using crossed APEX tickets should be examined and applied wherever possible. If the use of a reduced rate air fare requires an additional overnight stay, the traveller is entitled to the corresponding daily allowance payment (per diem), provided it is not in excess of the saving on the air fare. Where the use of an APEX ticket is not possible, a full economy ticket should be used instead.

Transport to and from the airport is generally considered city transport and thus covered by the per diem allowance. Exception is granted for flight departures before 7.00 and arrivals after 22.00 hours, in which case a taxi fare may be charged separately. Where inter-city travel is required to reach the airport, the rules for travel by train apply.

City and airport transport is considered to be covered by the per diem allowance.

Costs for travel by PC officials from their capitals to a MS/CC may be included in the budget to be financed by EU funds. Travel within a MS/CC, in connection with e.g. a study visit, is eligible for reimbursement, insofar as it does not fall under the per diem allowance.

Local travel for the MS/CC experts (PA and short/medium duration missions) in the PC, but outside the capital, must be specified and budgeted separately.

39 Whenever possible, the use of public transport is mandatory. If the only practical alternative is the use of a private or rented car, the indemnity as per above should be charged.

Experts (short term or PA) travelling by car do so under their own responsibility. Reimbursement of costs is always based on the above rules

5.6.2 Per Diem

MS/CC experts are entitled to an allowance (per diem) when operating in the PC. It is intended to cover hotel, food and local (city and airport transfer) transportation costs. The current rate published by the Europe Aid Co-operation Office on their web site (http://europe.eu.int/comm/europeaid/index_en.htm) at the time of the mission applies. The rate can therefore vary over the lifetime of the project. The basis for calculation of number of per diems are the number of nights spent away from the home base (no half per diems). The per diems given on the web site of the Europe Aid Co-operation Office are maximum amounts and in some cases it is advised to find economic solutions.

PC staff travelling to a MS/CC in the framework of a project are entitled to per diems according to the same rules.

PAs receive an allowance for every day of their secondment, based on 50% of the current per diem rate. The allowance is adapted if there is a change in per diems rates in the course of the lifetime of the project.

5.6.3. Reserve for adjustment of prices

The budget should contain a reserve (recommended maximum 2.5% of the total budget) to cover fluctuations in reimbursable (travel and per diem rates) costs.

5.7 Training and Seminars

5.7.1 Training in the PC Training activities must be the subject of detailed estimates. Eligible costs are mainly staff inputs by public officials and mandated body experts from MS/CC. The provisions for short and medium term missions govern their expert fees. The cost of MS/CC experts who will be working in the PC capital anyway, regardless of whether a specific seminar takes place or not, should not be entered in the seminar budget. This would apply, for example, to short-term experts who will be carrying out various tasks in the PC, one of which might be to speak at a seminar. S/He will not be entitled to additional fees or per diems, in excess of what has already been budgeted, for doing so. Other costs might relate to provision of:  training documentation;  interpretation;

40  transport for on-site visits, etc.;  infrastructure facilities – in normal circumstances, it is expected that the PC will bear the costs of providing a suitable venue/equipment for training in the PC. In exceptional circumstances, where this is impossible, the Commission will provide funding to cover fully justified expenses.

If any part of the training is sub-contracted to the private sector, the procedures for procurement as laid down in the Practical Guide apply.

If the training takes place in the PC, the PC will cover both the transport costs and per diems for its own staff (in some special cases exceptions can be made to this rule).

5.7.2 Trainee/internships in the MS/CC

The project covers the transport costs of staff from PC to MS/CC for the purpose of attending trainee/internships. Daily allowances for PC trainees are fundable through the project. They are intended to cover costs for food, overnight accommodation and local (in-town) transportation. For traineeships of more than two months the daily allowance rate is reduced by 30% as of the 3rd month.

Certain dedicated MS/CC training institutions delivering intensive highly specialised training operate on a fee basis for any trainee; such fees may be charged to the project. Costs for expert fees of MS/CC experts accompanying ad hoc practical trainee-ships cannot be charged to the project separately, but are deemed to be included in the flat rate compensation. Other reimbursable costs incurred by the MS/CC host administration must be detailed in the budget according to the same principles as for other training activities. Small incidental costs may be charged to the budget with a lump sum (maximum 10€ per trainee per day) and invoiced without supporting evidence.

5.8 Flat rate compensation

5.8.1 Principle The breakdown of costs may not include expert fees for work performed outside the PC, no matter what its nature (e.g. preparation or follow-up of mission, accompaniment of study visit, delivery of seminar in MS/CC, co-ordination, logistical management [accounts, organisation] overheads and other incidental costs).

In its place, and as a global contribution to the costs arising from the responsibility of preparing and implementing a Partnership project, the compensation for short and medium-term expertise of any kind (including the Project Leader) delivered in the PC is increased by a flat rate of 150%. This amount is added to expert fees for each activity in the PC. The MS/CC organisation in charge of the Partnership project may dispose of it for any costs arising in the MS/CC in connection with the project and overhead costs.

41 5.8.2 Beneficiary

The flat rate compensation is invariably invoiced by and paid to the MS/CC project leader in conjunction with the expert fees for short term experts working in the PC. The project leader uses and distributes it as s/he sees fit.

Where several MS/CC are involved in a project, the project leader may forward the full or a proportion of the flat rate to the partner MS/CC providing short term experts and recipient of the funds for their services. Generally, the lead MS/CC partner will retain a proportion ranging from 10-20% of the flat rate compensation to cover the additional costs for its leadership. It is important for the good implementation of the project that the consortium agreement between the lead MS/CC and other MS/CC partners, which they elaborate independently, without any advice or interference from their PC partners or Commission services, lays down the precise modalities in this respect.

5.8.3 Budget presentation

For every post in the budget concerning expert fees for work performed in the PC, the immediately following post in the same activity will be entitled "flat rate compensation" and quantified at 150% of the preceding post. The amount in the budget is indicative and actual payment will be based on the real amount of fees for days actually worked in the PC.

5.9 Translation and Interpretation

The PA should have a full time project assistant for the purposes of translation, interpretation on a daily basis and general project duties at his/her disposal. In some cases the PC beneficiary may be in a position to make such a person available. In most cases the costs for hiring an assistant have to be included in the project budget. Only in very exceptional cases should the requirement for an assistant be waved. Note that the project assistant may not have or recently (past 6 months) have had any contractual relation with the beneficiary administration.

The recruitment of a suitable project assistant may commence before signature of the agreement. A minimum of 3 candidates must be assessed/interviewed.

While it is presumed that the PC bears all its other own costs incurred in connection with the project, an exception can be made for costs for translation and interpretation. Costs for these services should be budgeted in relation to each activity for which they are required.

In the case of translation of legislation, project leaders must check whether the EU has already funded a translation. It is important to resort to authorised translators to ensure coherency in terms of terminology and format.

42 Translation costs must be charged at the PC rate. Interpretation costs may be charged at the rate corresponding to the place of the event. For events scheduled to take place in the MS/CC, it may be more advantageous to hire PC staff (even taking into account travel and per diem costs).

5.10 Equipment

Large Scale Equipment

Reference to equipment necessary for the implementation of the project must be mentioned in the "Description of the Action". However, it will not be financed by the project budget (except for small items with a unit cost below 5.000€).

It is the PC's responsibility to secure financing from a source of its choice (i.e. its own resources or funds available for that purpose, World Bank, EBRD etc.).

The PC's procurement procedures must, however, be reliable enough to ensure that the equipment is available when needed so as not to jeopardise the implementation of the project.

Office Equipment and supplies

The PC project partner is entirely responsible for providing all office equipment to ensure effective working conditions for the project and, in particular, projects cannot fund desktops, laptops, mobile ‘phones, faxes, scanners, CD-burners, etc.

In very exceptional cases and subject to due justification, small items of essential supplies (e.g. small laboratory testing consumables or equipment) for a total cost of not more than 5000€ may be procured to ensure that the implementation of the project can proceed smoothly. The Commission will assess the proposed expenditure restrictively, in light of its knowledge of the PC’s possibilities and on a case by case basis.

Any equipment purchased with project funds a) must be of eligible origin (manufactured in the EU, PC or other eligible country) and b) will become the property of the PC beneficiary at the end of the project.

EC Procurement Rules must be respected!

5.11 Private Sector Sub-Contractors

Where a MS/CC is otherwise unable to carry out an activity necessary to the implementation of the Partnership project, the Project may provide for that activity to be subcontracted to the private sector. This might apply, for example, to

43 software design, where private sector specialist input could be vital to the project’s success.

If the MS/CC implementing organisation cannot itself provide an audit certificate in support of the final invoice, an audit valid under the law of the MS/CC shall be commissioned and its cost included in the actual costs invoiced by the MS/CC.

 The Project Leaders of the Partnership project must comply with the Practical Guide procedures concerning the selection of sub-contractors, and in particular competitive tendering.  In support of his/her invoicing, the MS/CC Project Leader must provide documents showing that these rules have been respected.

5.12 Costs not covered by the EU

1. The direct and indirect cost of PC administrations, civil servants and national private experts working for the project is borne by that PC.

2. Costs for equipment that may be mentioned as a necessary element for the success of the project cannot be covered by the project budget.

3. The PC provides the experts sent by the MS/CC with the requisite facilities for professional use free of charge, which are thus not eligible for funding by the EU:

 adequately equipped office space,  telephone,  fax,  photocopiers,  computer,  secretarial support,  access to information.

5. According to the Financial Regulation for EU funding, costs for indirect taxes (VAT) cannot be covered by Community funds.

If the MS/CC implementing body cannot avoid paying VAT on some expenses in the MS/CC and cannot reclaim it, it is considered an inclusive cost and may be presented for reimbursement. MS/CC partners are advised to make careful enquiries beforehand.

EU funds will not be used to fund PC running costs. For the sake of long-term sustainability and in order to ensure that systems are established which are commensurate with PC future funding capacity, PC are expected to commit their own resources to projects.

44 PART C

IMPLEMENTATION OF PARTNERSHIP PROJECTS

45 Section 6: General Management of the Project

6.1 Management by the Project Leaders

The MS/CC - PC will manage both the finances and the logistics required for its organisation and implementation.

MS/CC activities are therefore organised and implemented by the Project Leader of the team from the MS/CC signing the Grant Contract with the European Commission. Similarly, PC activities will be organised and implemented by the Project Leader from the PC. The Project Leaders will have to work together closely to co-ordinate their activities.

In practical terms, the PA is likely to play an important role in assisting the Project Leaders in the co-ordination and management of the project.

The flat rate compensation for work performed outside the PC is at the disposal of the MS/CC Project Leader to be deployed for any expenses arising from the implementation of the project and not charged separately in the budget: expert fees for any work performed outside the PC, preparatory and reporting work on substance, accompaniment of traineeships or study visits, delivery of training in the MS/CC, logistical and financial management, co-ordination between MS/CC partners, etc.

These tasks and responsibilities require strong project management capacity and a minimum of financial and legal autonomy. Each MS/CC is free to choose the most appropriate co-operation structure according to the structure of its national administration.

46 6.2 Project Reporting Requirements

 The Project Leader of the MS/CC will be responsible for submitting, within the second month an inception report, later an interim report and a final report for a particular Partnership project;

 The Project Leader of the PC will be fully involved in this process and should be given adequate time to put forward comments. S/He must also co- sign each report before it is submitted to HQ;

 Reports must contain, as a minimum, the information detailed below. Reports must also be submitted on time as specified below.

 The Commission reserves the right to review or suspend funding of a Partnership project if minimum reporting requirements are not met. Absence of feedback from the EC Delegation within one month of presentation of reports is considered to signify tacit approval.

The Formal Reporting Process

For each Partnership project, the Commission will require the MS/CC Project Leader to submit the following reports :- a. project reports

These reports will reflect not only the Project Leader's own opinion on the progress of the project, but should also be based on and reflect the information contained in the reports provided to him/her by the Partnership Adviser, the PC and other sources (i.e. short term experts, organisation of training and seminars, private sector inputs). It is vital that the PC is fully involved in the preparation of each report, in order to ensure a comprehensive insight into project progress.

HQ is responsible for checking that the PC partner has been involved in the preparation of the report and has countersigned it. HQ will act on the content of reports as necessary, with support from the Delegation when required.

The reports must as a minimum:

 Describe progress achieved in the implementation of the project during the period under consideration, making direct reference to the timetables and benchmarks set out in the Agreement.

Subsequent reports will contain some analysis and must, in addition to the above:

 Make an overall evaluation of the progress achieved, including an explicit judgement on the likelihood of fully completing the project within the remaining time scale and budget;

47  Summarise the actions undertaken in the project for the period under consideration, again making reference to the original project plan, highlighting any previously unforeseen activities or activities that have been cancelled;

 Update on the general environment for project implementation;

 Update on the assumption and risks for project implementation. b. Final project report

The MS/CC and PC Project Leaders will jointly prepare, co-sign and submit to the EC Delegation a final report during the final month of the project. It will include :

 Executive summary of the Partnership project;

 Confirmation that the required result has been delivered. In the exceptional instance where this is not the case, an action plan to complete the project must be submitted;

 Summary of the Partnership project implementation including a description of the general environment for implementation, and any unexpected difficulties;

 Evaluation of the Partnership project;

 Recommendations, including lessons to be learned for future Partnership projects.

c. Financial Reports

The final financial report must be accompanied by an audit certificate from a recognised, independent auditor. The auditor must certify that all the transactions invoiced by the MS/CC partner in the course of the agreement were duly justified in accordance with the established rules and arose solely as a result of the agreement.

6.6 Changes to a "Grant Contract"

Changes to "Grant Contract" must be made in the form of an addendum to the "Grant Contract" in conformity with rules stipulated in the Practical Guide. As a general rule, changes should, if possible, not be made to the budget, the minimum results and the PA.

48 Section 7: Financial Management and Control

7.1 General Principles

 All expenditure must follow EU Practical Guide/ Financial Guide procedures

 All costs incurred by the MS/CC partner and its staff (reimbursement of salary for PA, allowances and reimbursement of costs to the PA and all other project costs, formerly categories I, II and III) and detailed in the breakdown of costs are cumulated into one single category and reimbursed by the EU programme to the MS/CC

 All payments are subject to presentation of either a request for an advance or an invoice.

 Requests for the advance and invoices must bear the original signature of the Member State/ Candidate Country Project Leader.

 Payments funded by EU programmes are made in Euro. Costs incurred in other currencies must be converted at the rate published by the European Central Bank in the “C” series of the Official Journal applicable on the first day of the month in which the cost was incurred. There will be no compensation for exchange rate fluctuations which may arise between the date when the cost was incurred and its payment.

 The payment agent for the projects is HQ.

 Unless otherwise provided, payments shall be made within 60 days of receipt of the request for payment. Payment may be deferred if the services covered by the payment are contested. The 60-day payment period does not include any delays occurring as a result of banking procedures.

 If the time-limit for payments is exceeded, the signatory Member State shall be entitled to interest calculated pro rata on the basis of the number of calendar days by which payment is delayed, at the interest rate applied by the European Central Bank, as published in the Official Journal of the European Communities for the month in which the payment is made, increased by 1%. This indemnity is exclusive.

7.2 Payment Procedure (General Conditions)

Option 1 : Actions with an implementation period not exceeding 12 months or where the financing provided by the Contracting Authority does not exceed EUR 100.000.

49 The Commission will make grant payments to the Beneficiary in the following manner:

 an advance of 80% of the amount referred to in Article 3(2) of the Special Conditions less contingencies within 45 days of receipt by the Commission of :

- the Contract signed by both parties,

- a request for payment conforming to the model attached as Annex V, and

- a financial guarantee if it is required pursuant to Article 15(7);

 the balance within 45 days of the Contracting Authority approving the final report in accordance with Article 15(2), accompanied by a request for payment of the balance conforming to the model in Annex V.

Option 2 : Actions with an implementation period of more than 12 months and where the financing provided by the Contracting Authority is more than EUR 100.000.

The Commission shall pay the grant to the Beneficiary in the following manner:

 an initial pre-financing instalment of 80% of that part of the estimated budget for the first 12 months financed by the Contracting Authority, as specified in Article 4 of the Special Conditions, within 45 days of receipt by the Contracting Authority of :

- the Contract signed by both Parties,

- a request for payment conforming to the model attached as Annex V, and

- a financial guarantee if it is required pursuant to Article 15(7);

 further pre-financing instalments of the amount specified in Article 4 of the Special Conditions within 45 days of the Contracting Authority approving an interim report in accordance with Article 15.2, accompanied by:

- A request for payment conforming to the model in Annex V,

- An audit report if required under Article 15(6),

- a financial guarantee if required under Article 15(7);

 the balance within 45 days of the Contracting Authority approving the final report in accordance with Article 15.2, accompanied by:

- a request for payment of the balance conforming to the model in Annex V;

- an audit report in accordance with Article 15(6).

Further pre-financing may only be given if the part of the expenditure actually incurred which is financed by the Contracting Authority (by applying the

50 percentage set out in Article 3.2 of the Special Conditions) stands at 70% at least of the previous payment (and at 100% of any previous payments) as attested in the corresponding interim report and, where applicable, in an audit report as specified in Article 15(6). The sum total of pre-financing under the Contract may not exceed 90% of the amount referred to in Article 3.2 of the Special Conditions.

Final payment :

The final financial report must be accompanied by an audit certificate from a recognised, independent auditor. The auditor must certify that all the transactions invoiced by the MS/CC partner in the course of the agreement were duly justified in accordance with the established rules and arose solely as a result of the agreement.

If the MS/CC implementing organisation cannot itself provide an audit certificate in support of the final invoice, an audit valid under the law of the MS/CC shall be commissioned and its costs included in the actual costs invoiced.

7.4 Private Sector Inputs: tendering, procurement and contracting

Private sector inputs are subject to the procedures laid down in the Practical Guide to external aid contract procedures.

7.7 Audit

In the course of the implementation of Partnership projects, both the projects themselves and their management may be subject to various audits :

 ad hoc audits called by the Commission;  ad hoc audits by the European Court of Auditors.

Ad hoc audits called by the Commission are to provide an independent view on the sound and efficient management of projects and/or may examine specific issues.

The Court of Auditors is independent from the Commission. It has the responsibility of checking the expenditure of the Community regarding compliance with relevant legal provisions and principles, the soundness of financial management and the achievement of objectives.

51 Section 8: Other Issues

8.1 Languages

Language is a basic but important issue:

In the framework of drafting the Project Document, the Work Plan and the Budget, the partners should:

 have identified translation and interpretation needs and made appropriate provision;  have agreed upon common working languages and consequently the language skills required of the PA for carrying out day to day duties;  have agreed upon English as the language to be used for reporting purposes.

To facilitate the work of the PA, experience has shown that a full time assistant (PC national) who deals with both translation and interpretation issues (and other project management tasks) on a daily basis is essential. Provisions must be made in the Agreement for this cost, unless the PC administration can make available an assistant, or the PA is fluent in the host PC language.

If the translation or interpretation requirements throughout the project are significant, the conclusion of framework agreements with reliable and tested staff is a cost-effective solution. In return for a guarantee of a significant number of days of work over a specific period, a favourable unit price can be negotiated. Individual service orders can then be issued as the need arises.

While costs for translations are eligible for funding under Partnership projects, this is an exception to standard rules and should be used judiciously.

Language training for PC staff is not eligible for funding under Partnership projects, subject to derogation for exceptional and very technical purposes.

8.2 Troubleshooting

In practice, all projects will face unforeseen difficulties. Some of these may be small logistical problems, whilst others may impact on the overall success of the project.

In the first instance, the MS/CC and PC Project Leaders should attempt to resolve any problems between themselves. If there is a more significant problem or a need to inform the Commission, then the Project Leaders should contact the Commission.

52 The Commission will reserve the right to suspend or cancel funding for the Partnership project in the worst case scenario.

If, at the end of the time period fixed by the "Grant Contract", the required result has not been achieved, the partners may ask the Commission for a time extension to complete the project with the condition that:

 the need for extension can be duly justified  the extension falls within the overall time limit set out in the Financing Memorandum;  there is no increase in the financial contribution from the EU funding source.

8.3 Acknowledgement of Funding Source

Implementing partners whose project benefits, in whole or in part, from European Commission funding, are under an obligation to publicise the funding source with the appropriate logo. It has been decided that the EU’s logo – the blue flag and stars - should be the only one used. No matter what the size of the project, the materials it produces should carry the EU identity.

For help and guidance in complying with this obligation, the Information Officer at the EC Delegation in the country is available and DG Relex and EuropeAid have published “Identity Guidelines”. Delegations carry a stock of flags, stickers, posters and other promotional material that can be obtained. Simple solutions for producing everyday materials, Master originals, given as a series of computer templates, have been developed, so that materials can be produced from standard office computers at minimum cost.

A small amount of funds (3000€ for projects up to 1 M€, 5000€ for projects over 1M€) may be allocated in the projects to meet these requirements.

More information and templates can be found at the following internet site: http://www.euvisibility.net/

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