Outlook on effective management of EU structural funds from 2007-2013 to 2014-2020

1. Outlook on effective management of EU structural funds from 2007-2013 to 2014-2020 2012-02-01 Vilnius

2. Content of Presentation Orientation towards results and ways of simplification LT experience in: Enhancing administrative capacity; Use of simplified costs; Process review; Use of IT tools Implementation issues in the 2014-2020 Regulations’ drafts

3. European Commission Government of the Republic of Lithuania Ministries Monitoring Committee of Operational Programs Ministry of Finance Ministry of Environment Ministry of Managing Authority (consist of assistance administration institutions’ officials and social economic partners) Social Security & Labour EU Structural Assistance Management Department Ministry of Transport Ministry of Healthcare Certifying Payments Ministry Authority making Audit Authority of Education & Science Authority Managing Committees of Operational Programs Ministry of Economy National Fund Department State Treasury Department National Audit Office Ministry of Interior (consist of assistance administration institutions’ Officialspartners) Information Society Development Committee Councils of Public Implementing Institutions (7 Agencies) Procurement Regional Development Office Lithuanian Central RCC Environmental JSC “INVEGA” Project Business ESF Project Project promoters Management Support Agency Management TIDe Agency Agency Agency Cohesion policy –systems and requirements EU requirements National and regional requirements

4. Cohesion policy “Cohesion policy has to be known not for it’s complexity, but for it’s results” (Informal meeting of the minister’s) “One size does not fit all” (Informal meeting of the minister’s)

5. Result oriented Cohesion policyhow to achieve it? What is the way to go through all complex process towards results?

6. Result oriented Cohesion policyhow to achieve it? What is the way to go through all complex process towards results? Human resources Management and control systems Process and Functions Results Simplified costs IT tools Process review

7. What is simplification? • The ability to simplify means to eliminate the unnecessary so that the necessary may speak.  ~Hans Hofmann, Introduction to the Bootstrap, 1993

8. What is necessary? • UE SF management has to be Sound, Efficient and Effective • It requires Appropriate, Effective and Transparent systems • These systems have to ensure: • Selection of quality operations and effective implementation • Prevention and detection of irregularities and reasonable assurance on the regularity of expenditure • Delivery systems should be as simple and streamlined as possible • ...and orientation towards results

9. First of all – qualified, creative and constantly willing to improve employees

10. Administrative capacity buildingin EU SF management and control system • Context: • Around 1200 employees in ES SF management and control system • 3 level institutional structure (MA, line ministries and agencies) which composes of 18 institutions • Different cultures and legal status of institutions Demand to ensure that MA’s delegated tasks are performed according to the requirements and effectively • Qualification development system: • Review of EU requirements for systems and functions • Identification of existing qualification development tools between institutions • Determination of general (minimum) requirements for competences according to the institution and target group • Identified 11 thematic subjects for the development of competences • Launched procurement for centralized training services

11. Simplified costs

12. LT experience – Simplified costs • Provides real possibility to reduce administrative burden for beneficiaries • Integration of simplified costs requirements in the national legal system • Still difficulty to implement for budgetary institutions • What’s working so far (ESF): • Flat rate scheme for indirect costs (approved by EC in 2011) • Unit costs (e.g. Scholarship amount for post graduate student or scientists who come back to work after maternity/ paternity leave, wages for scientists); • Lump sums (e.g. For publicity activities).

13. Process review

14. LT experience – Process review • Review of project cycle management bottle-necks • Acceleration of processes • Appraisal, up to 3 months; • Payment claim verification, up to 30 days; • Contracting, up to 30 days • Appraisal process: • State planning procedure (up to 2 months); • Combination of appraisal phases • Risk based management: • for payment claims; • for public procurements; • for on the spot checks • Unified Indicators system • Requirements to use information in the national databases

15. IT tools

16. LT experience – SFMIS2007 • Starting point: not IT tool for itself, but effective project cycle management tool • Designed step by step together with detailed requirements for processes and procedures • The main management tool for EU SF MCS institutions: • Used in everyday EU SF management procedures • Paperless data exchange between EU SF MCS institutions • Dataquality, reliability and sustainability • Electronic Application and payment claim forms • Process monitoring

17. SFMIS2007 functional structure SFMIS2007 modules Register of Enterprises 1.Projects Data exchange website for beneficiaries 2.Payments Data exchanges with Government Budget Accounting & Payment System 3.Monitoring Websitewww.esparama.lt 4.Analysis 5.Administration

18. SFMIS2007 Benefits • A form (Application) data import: • from 2 hours (2004-2006) 1-2 min. (SFMIS2007) • Contract data generation: • 15 minutes to generate from imported and verified application data. • Indicators, project appraisal information, payments forecast – everything is in the payment claim, no need to collect this data in other ways. • Interim participants reports (e-forms)

19. Implementation issues in the 2014-2020 Regulations’ drafts

20. General remarks • Requirements and process • Stronger role of EC in setting more requirements (thematic concentration, conditionalities, performance framework, accreditation, suspension of payments, etc.) • Does it fully comply with proportionality principle? • Simplified costs • More options to use simplified costs, but... • whether more detailed EC working documents will not specify otherwise? (Remember - devil is in the details) • E-Cohesion • Paperless process should not be an end in itself and not overemphasized. • what about management verifications and audits, electronic signature and legal basis? • Will the same requirements be applied for audits and controls?

21. Conclusion – more questions? • What could be done for simplification despite complexity of 2014-2020 Regulations? • Does EU regulations provide sufficient legal certainty? • Remember - Devil is in the details • Is the new system lay down conditions for orientation towards quality results rather than assurance of eligible expenditure?