In 2011, the Contact Committee of the heads of Supreme Audit Institutions (SAI) of the Member States of the European Union (EU) and the European Court of Auditors (ECA) mandated the Working Group on Structural Funds to continue its review of issues relating to Structural Funds, more specifically, to carry out a parallel audit on the ‘Simplification of the Regulations in Structural Funds.’
The Working Group consisted of 12 EU Member State SAIs and audited the impact of nine simplification measures. The following are the key conclusions:
In general, the simplification measures were infrequently used and affected only a small proportion of all projects, largely due to a number of factors relating to the management of Structural Funds at national and supranational level, including:
• Introduction at a late stage by amendatory regulations;
• Not all measures were suitable for all Operational Programmes (OP) and/or projects;
• Limitations relating to the resources required for the implementation of measures; and
• A lack of clarity and legal certainty experienced by national authorities.
Whenever the measures were used, most of them were considered to represent genuine simplification. Factors relating to why national authorities chose not to use the measures differed considerably, depending on the European system1, the national legal system, the organisation of Structural Funds in each Member State, as well as the specific features of each OP. These conditions influenced the potential scope of application of measures and their respective benefit.
The key findings of the report were the following:
Measures 1, 2 and 3 (flat-rate for indirect costs, flat-rate costs based on standard scales of unit cost, lump sums):
In the case of national authorities, the process of establishing the methodology relating to the application of the above-indicated measures led to administrative burdens and was regarded as difficult and involving an element of risk; furthermore, developing the methodology and acquiring the Commission’s approval were often lengthy processes. The lump sum was perceived as too low and the ‘all or nothing-principle’ led to a reluctance of the measure’s use. Whenever these three measures were used, they constituted genuine simplification.
Measure 4 (in-kind contributions to financial engineering schemes):
This was the only measure that was not used in any of the audited OPs within the participating Member States.