The target for the tolerable risk of error in research and development is 3.5 per cent, the Financial Programming and Budget Commissioner Janusz Lewandowski said in a briefing last week. “No more than 4 to 5 per cent should ever be tolerated,” he added.
At present, the level of error allowed in all policy areas is set at 2 per cent. The Commission suggests raising this level on a policy-by-policy basis, taking into account the specifics of a particular area.
The change is part of the Commission’s wider proposal for a revised financial regulation, responsibility for which falls to Commissioner Lewandowski. The Commission’s target date for entry into force of the proposed changes, which need to be adopted by the European Parliament and the Council, is 1 January 2012. The revised financial regulation, which deals with all funding programmes and not just research, will also allow many of the changes proposed in the Commission’s recent communication on simplification to become reality.
Lewandowski said that the proposed measures would reduce costs and workloads and get rid of what is now “a bureaucratic nightmare.” In a separate statement, he commented, “My main goal is for EU funding to stimulate innovation and growth by making it more accessible to European businesses, SMEs, researchers and other beneficiaries.”
According to the Commission, adopting a tolerable risk of error will allow the right balance between appropriate oversight and the cost and administrative burden that flows from tighter controls. Such a margin would, “recognise that in some areas, complex rules, extended control chains and control costs do not permit a 2 per cent error level to be attained without incurring higher than justified costs,” the Commission said.
Christopher Hull, secretary-general of the European Association of Research and Technology Organisations, said that while it is “Probably helpful to set a higher level of tolerable risk,” this addresses only part of the problem.
It is important to ensure that all institutions interpret the rules in the same way, something that didn’t happen in “the ex-post FP6 audit fiasco,” and that the European Commission, Parliament and Court of Auditors don’t end up in an inter-institutional power play. “A broader margin of error may help, but above all it is essential to be clear about what the rules mean,” Hull said.
Other measures put forward by the Commission last week include waiving the obligation to pay interest on upfront payments (pre-financing) and raising the ceiling under which grants can benefit from simpler administrative procedures from €25,000 to €50,000.
As the Commission seeks to shift the emphasis of the grant system from reimbursing cost claims, to paying for the delivery of results, one suggestion is to expand existing measures on lump sum payments and flat rates.
For example, the Commission plans to abolish the maximum threshold for lump sum payments so it can take decisions on a case-by-case basis depending on the nature of the programme. “In such grants, beneficiaries will be paid lump sums to undertake specific [...] tasks and will then need to demonstrate that they have done so effectively and efficiently, rather than to report individual cost items,” the Commission said.
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