Original publication: April 2016
Authors: Metis GmbH: Jürgen Pucher, Isabel Naylon, Herta Tödtling-Schönhofer
Short link to this post: http://bit.ly/2EG0IuA
This study offers insight on the e-Cohesion initiative and describes how it is being applied in the Member States (MS). It explains the concept of e-Cohesion as laid down in the current legislative framework and looks into the rationale and background. Within this research framework the report addresses the following main questions:
- Is e-Cohesion contributing to simplification and to the reduction of the administrative burden?
- How is e-Cohesion contributing to the overall coordination and complementarity among the EU structural and investment funds?
The study looks at the e-Cohesion initiative itself, the options the MS presented in the adopted Partnership Agreements (PAs) and the state of play of its implementation at national level. Following a description of the background and reasoning behind the e-Cohesion initiative, the study summarizes the information provided by MS in the adopted PAs. Though limited information is available beyond the PAs, MS are grouped according to two analytical elements. First, MS are clustered in two groups according to the amount of information available about the e-Cohesion systems in use. This cluster shows that there is about as many MS for which sufficient information is available on the subject as MS for which it is difficult to find out anything in specific about the changes introduced with respect to e-Cohesion. The study also clusters MS e-Cohesion according to the logic of application of e-Cohesion. More precisely, while some MS use only one common e-Cohesion system, others use one electronic data exchange system either per fund, administrative unit or other.
This study summarizes and analyses the information that exists so far about the adaptation or introduction of electronic systems in the MS in view to respond to the e-Cohesion regulations. Generally, the study thereby opens new fields of research and analysis which will then lead to an overall understanding of how e-Cohesion contributes to the overall coordination and complementarity among the European Structural and Investment Funds (ESIF).
Given that an important issue in the programme period of 2007 – 2013 was the administrative cost and burden related to project selection and monitoring, the changes foreseen for the 2014-2020 programme period reflect the need to simplify the implementation of OPs, both for beneficiaries and programme bodies. In this context, e-Cohesion is seen as enabling the access to a secure online solution for data exchange with the relevant bodies involved in the implementation of CP.
The concept of e-Cohesion is most importantly outlined in Article 122(3) of the Common Provisions Regulation (CPR), which states that Member States by no later than 31 December 2015 shall ensure that “all exchanges of information between the beneficiaries and a managing authority, a certifying authority, an audit authority and intermediate bodies can be carried out by means of electronic data exchange systems” and for the European Regional Development Fund (ERDF), the European Social Fund (ESF) and the Cohesion Fund (CF). As detailed in the Implementing Regulation (EU) No 1011/2014, Article 8, the exchange of documents and data shall include “reporting on progress, payment claims and exchange of information related to management verifications and audits”. It is important to add that in regulatory terms, e-Cohesion does not concern all funds but mainly the ESF, ERDF, and the CF.
E-Cohesion and the reduction of the administrative burden
The EC has estimated that the use of digital technologies will reduce the work load by 11% (easier detection of bottlenecks at an early stage, easier communication also with beneficiaries, improved monitoring) and, at the same time, reduce the risks in the process of funding (risk of double-funding). At programme level e-Cohesion systems can especially help avoid the duplication of information and document requests. Information requirements – reporting on progress, declaration of expenditure and exchange of information related to management, verifications and audits – should be fulfilled via electronic exchange. However, many programme authorities did not expect e-Cohesion to substantially reduce the administrative workload because systems were already in place, installing and maintaining new systems would be time-consuming and costly (training staff and beneficiaries, security and maintenance costs, etc.), and national legislation requires hard copy documents for some purposes.
E-Cohesion in the regulation
Following the Regulation (EU) No 1303/2013, Article 122(3), the minimum requirements on e-Cohesion for those who have already signed a contract (unlike applicants), are:
- the ‘only once’ encoding principle (i.e. beneficiaries should not need to enter the same data more than once in the system, at least within the same OP)
- the concept of interoperability (data encoded by beneficiaries needs to be shared between different bodies within the same OP)
- the electronic audit trail complies with relevant articles of the CPR (Art. 112 on “Transmission of financial data” and Art.132 on “Payment to beneficiaries”) as well as with any national requirements on the availability of documents
- The system for electronic data exchange guarantees:
o data integrity + confidentiality,
o authentication of the sender (Directive 1999/93/EC),
o storage in compliance with defined retention rules (Article 140 (3) of the CPR).
Current state of play
A study carried out in September 2015 shows that most MS developed functioning IT systems in the previous programming period. Only in a few countries the PA is not specific on the subject of e-Cohesion and the IT systems. The e-Cohesion systems are being further developed and adapted in the current period to improve interoperability between the systems catering for the different ESI funds and in order to be fully compatible with SFC. In a number of countries an assessment was carried out of what is still needed and a plan developed. The technical details and what the systems can do are generally described in the PAs.
Summarizing the information on e-Cohesion in the Partnership Agreements
In a number of countries an assessment was carried out of what is still needed and a plan developed. The technical details and what the systems can do are generally described in the PAs. While tables of deadlines are not included in a number of countries the examination of the PAs shows various approaches as regards deadlines. There are a few countries (Belgium, Lithuania and United Kingdom) favouring decentralized e-Cohesion systems which have the disadvantage of not always having all data stored in one place. While timetables of completion of systems are not included in a number of PAs, there was no risk that these will not be up and running in time and before the regulatory deadline.
Generally, it is possible to distinguish between:
- countries for which the PAs do mention e-Cohesion measures, but the changes planned are broad or not particularly different from the systems used in the previous programming period (AT, DE, DK, FI, HU, IE, IT, MT, NL, PL, PT, SI, ES, SE, UK);
- countries for which the PAs describe the planned changes in detail or where major changes are foreseen (BE, BG, CY, CZ, EE, FR, GR, HR, LU, LV, LT, RO, SK).
The different extent to which the e-Cohesion measures planned are described in each PA does not reflect upon the extent of the implementation or the quality of the e-Cohesion systems in place. Also, the changes might in fact not be major in MS where e-Cohesion-related simplifications have already been carried out in the previous programming period or where the need for a change was not too radical.
Overview on the state-of-play in selected MS
The extent of information on e-Cohesion systems planned or implemented in the MS varies across MS’ PAs. This can have different reasons, including the possibility that some MS have already carried out relevant changes in the previous programming period. Interestingly, the information about the changes related to e-Cohesion systems as a simplification tool used in the 2014-2020 programming period is scarce when looking beyond PAs.
Based on the literature and information available, the following assumptions can be made:
– The role of e-Cohesion on the performance of managing authorities is not clear-cut. On the one hand, e-Cohesion was seen as one of the main tools to reduce the administrative burden for MAs, on the other hand, the requirement to amend the systems already in place or introducing new systems can be a time and money consuming process.
– There is no evidence at this point that Technical Assistance is being requested by MS to implement e-Cohesion, but further research should be carried out later in the 2014-2020 programming period to learn more about the managing authorities’ experiences and needs with regards to e-Cohesion (e.g. due to computer or internet illiteracy).
– The use of e-Cohesion in the context of Integrated Territorial Approaches (ITIs) is only mentioned in the PAs of Poland and Spain, where e-Cohesion is seen as a useful tool to implement this innovative instrument. There is however no mention of Community-led Local Development (CLLD). This should also be further analysed once the e-Cohesion systems are up and running and their users have had time to apply them in various areas.
– Following the 2nd Meeting of the High Level Expert Group (March 2016) on “Monitoring Simplification for Beneficiaries of ESI Funds” and the accompanying “Interim Report on e-Governance” two regions and one MS were identified as good examples for e-Governance: Wales, Flanders and Estonia. The report says in its conclusions: “The experiences shared by the Welsh, Estonian and Flemish authorities are good examples that should be made available to all.” The three good practice examples base on the following principles to simplify and streamline the implementation of ESI Funds through e-Governance:
o reduction of administrative burden for beneficiaries;
o provision of IT services allowing beneficiaries of the Funds to exchange information with programme authorities;
o usage of electronic portals accessible through the web.
The HLG concludes in the Interim Report: “The sharing of bad experiences and encountered problems on both the implementation and technical levels is also needed in order to help other Member States avoid unnecessary delays in the adoption of e-Governance.”
– There is little information about the role of e-Cohesion in supporting complementarity between projects belonging to one OP and among projects financed by other OPs. Within the same OP at least, a beneficiary involved in more than one project, will not have to send a document twice to any programme authority. Complementarity can not only lead to more synergies once the authorities identify possible similarities between projects whose data is saved electronically, but also facilitates transparency and external public communication.
With regards to the information that is available however, based on a PA review and a desk research of national sources, it is possible to draw four distinct groups of MS. In this study, each of these groups is symbolised graphically and illustrated by two country fact sheets.
- MS with one system per fund: i.e. MS where the electronic systems used for each ESI Fund are managed and accessible through separate channels (examples used: AT, NL)
- MS with one system per regional administrative unit: i.e. MS where the electronic systems used are managed and accessible separately for each region / Land / federal state (examples used: UK, BE)
- MS with one system for all ESIF: i.e. MS using one single electronic system to manage and access all ESI Funds at once (examples used: FR, LU)
- MS with several systems: i.e. MS using several separate electronic systems mainly to bundle only some of their ESIF OPs (e.g. ERDF/ESF/CF in contrast to EMFF) (examples used: RO, BG).
This cluster allows for a country-comparison which, amongst the features above, also includes the following aspects:
– Decision to use e-Cohesion as a means to simplify OP management (especially in those MS where the number of electronic systems has been reduced)
– In federal states (DE, BE) and several regionalised states (e.g. UK), the electronic systems are still being separated between administrative units, which shows that e-Cohesion as a means of simplification is not considered convincing enough to change the usual administrative ways.
– Coordination between data related to different funds (ERDF, ESF, Cohesion Fund but also EAFRD and EMFF) – Situations of double workflows (i.e. paper and electronic): Electronic handling of documents and data should help the authorities using the services to reduce the paper documentation for both programme authorities as well as beneficiaries and thereby ensure more efficient document handling by creating more transparency.
These different approaches do not reflect the quality or the extent of improvement for programme management authorities or beneficiaries (and even applicants, wherever the platforms also target them). Therefore, further along in the programming period, it will be interesting to carry out a survey or interviews with users of the systems in place to find out if any improvement has in fact been noted compared to 2007-2013, and to truly grasp whether e-Cohesion does contribute to simplification and to the reduction of the administrative burden. Also, a cost and benefit analysis could show if the benefits (less administrative burden, avoiding duplications, etc.) exceed the costs of installing the new systems and training the users (financial costs and duration).
Challenges for MS
Given that in most MS, online tools or IT systems were already in place, the main task is now to adapt these tools or replace them with IT systems that correspond to the regulatory requirements. Thus, the challenge lies in the adaptation and upgrading of existing IT systems rather than in the creation of new systems.
These adaptations can be translated into, for example, reducing the number of e-Cohesion systems in use to improve the coordination between the funds, administrative units involved, management and applicants, i.e. rather than having one system per Land as was the case with the ERDF in Austria in the previous programming period, having one central ERDF system for the 2014-2020 programming period. This implies a simplification in the overall system.
It can also mean that MS are looking to introduce systems that allow for a better exchange of information between the authorities and the beneficiaries (e.g. EE), but also between regions / federal states (e.g. DE), funds (e.g. LU), or other institutions and authorities involved (CY).
The examples analysed in the present study show that while there is no indication of delays in implementing e-Cohesion systems, MS are faced with the challenge of adapting and simplifying existing IT systems in time for the first uploading of data into SFC2014 for the Annual Implementation Report 2016.
While MS are clearly aware of the minimum requirements on e-Cohesion laid down in the Regulations, it could be that MS use the momentum to go beyond those minimum requirements when adapting their IT systems. This could mean, for example, that they have decided to introduce more detailed IT requirements in order to be able to produce better data for evaluations, including the introduction of questions in the online application forms or introducing the possibility to perform various data analyses, e.g. per target group etc. As there has not been any systematic in-depth research done on the extent of implementation of the e-Cohesion principle in the MS, the actual complexity of the systems is not known and insufficient evidence is available.
E-Cohesion and the Managing Authorities
MS are to gradually implement systems that enable beneficiaries to submit all information and document electronically and only once to programme bodies. This requires the set-up of a fully-fledged electronic application and monitoring system with access possibilities for different programme bodies including the “First Level Control”, i.e. the basis of the audit and control systems (or the development of interfaces and maximum use of already existing databases). The EU has estimated that the use of digital technologies will reduce the workload of Managing Authorities by 11% which will address the overall administrative burden faced in fund management. However, introducing a new tool clearly implies a period of learning and adapting for the Managing Authorities, which points to an increase in costs that are not only of financial nature. Again, there has been no systematic study of the impact of these changes on the Managing Authorities.
E-Cohesion for the submission of project applications and within the coordination between the funds
MS use innovative ways to keep up with information requirements via electronic exchange systems. It is not required to set up a facility enabling electronic submission of project applications, but if MS wish to do so, they may extend the concept of e-Cohesion to applicants as well. This has been done in a number of countries, often in combination with an IT tool that allows for better coordination between different funds. In that way, information is handled efficiently as it reaches the recipient more quickly (whether from management level to beneficiary level or vice versa) and can be used by all the authorities involved (e.g. EE, LT). As shown earlier, MS are implementing new or updated electronic systems that allow them to share the information stored with all the authorities involved or permitted to access the data in question (e.g. LV, HR). In some MS, while several electronic systems were or still are in place, stronger coordination is planned in the future (e.g. DE, HU).
Different IT-systems and electronic applications
There are approximately as many countries using a single electronic system as countries using several electronic systems. Wherever several systems are used, these can be either independent platforms by funds, regions/ administrative units, or technical function, but in all those cases the PAs mention that the interoperability is planned to be improved in the 2014-2020 programming period (e.g. DE, HU). Some MS explicitly describe in their PAs that they have moved from having several IT systems to a single platform (e.g. LU).
The following recommendations can be drawn based on the existing literature (albeit limited) and possible assumptions:
1. Given the scarcity of any concrete information on the experience with e-Cohesion so far, the main recommendation of this study is to carry out a survey and/ or an analysis on the impact that e-Cohesion has had on the programme authorities’ and beneficiaries’ daily work related to ESIF programme and project management, further along in the 2014-2020 programming period. Only then will e-Cohesion tools be introduced, applied, acquired and tested by their users.
The HLG of Independent Experts on Monitoring Simplification for Beneficiaries mentioned in chapter 3 of this study was set up by the EC. The main task of the group of experts is to advise the EC with regard to simplification and reduction of administrative burden for beneficiaries of the ESI Funds. The main recommendations for the Commission in the Interim Report from March 2016 are:
- The members of the HLG recommend that the EC should go further in its efforts to facilitate the possibility for MS to have a common platform or system across the ESI Funds that would provide a consistent approach for beneficiaries to audit issues and information technology.
- For the current period, the members of the HLG call on the Commission to ensure a consistent approach to audit that will not undermine the potential e-Governance to simplify the management of the ESI Funds and, most importantly, simplify the process for beneficiaries to apply for and receive funds.
- The members of the HLG call on the Commission to encourage more of a partnership approach to e-Governance and to assist MS and MA with training for partners in order widen the use of the systems put in place by extending the possibility to use technical assistance across all the ESI Funds.
The findings and recommendations of the High Level Group should be taken into consideration when assessing and shaping the e-Cohesion measures both at EU and at MS level. Particularly, good practice examples from the MS and a possibility for the users of e-Cohesion systems to exchange their experiences should be supported to ensure that the systems are implemented as efficiently as possible.
2. Technical or other assistance
Once the experiences with the newly introduced or adapted electronic systems are analysed it should be clarified if the users (authorities involved in programme management as well as beneficiaries) need any assistance in training. The EP and EC should ensure that programme authorities get the opportunity to voice the need for such assistance also at European level if deemed necessary (e.g. through the HLG mentioned above).
3. Transparency and complementarity
E-cohesion can lead to more transparency for the authorities since it is easier to keep an overview of all the different projects that are being carried out when collected in an electronic data storage system than in paper form. This advantage should be used by the programme authorities to identify the similarities and the potential for creating synergies and complementarities between the projects. The EP and the EC should ensure that programme authorities identify such potential and act upon it.
4. Transparency and external communication
One advantage of electronic systems is that it is easier to reuse the information on projects for other purposes such as external communication (e.g. for promotion or campaign purposes) to policy-makers, interested stakeholders or the general public. This advantage should be used by programme authorities and therefore the EP should ensure that the EC communicates this necessity and opportunity to programme authorities.
5. Case-by-case solution
This study shows that despite a common regulation, MS have chosen different paths of implementing e-Cohesion. While some MS have introduced a single centralized electronic system, others use several electronic systems. The categories and clusters created for analytical purposes in this study do not have any correlation with the quality. These differences should be accepted since each MS chose an electronic system according to its tradition and administrative set-up.
Link to the full study: http://bit.ly/573-442
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