NEATH PORT TALBOT
PROJECT MANAGEMENT GUIDE
Spring 2011
PURPOSE
This guide aims to assist project managers delivering schemes funded
through the Rural Development Plan for Wales 2007-2013 and the Neath
Port Talbot Business Plans 1 and 2.
It supplements the European and National rules and regulations that apply to
the monitoring of RDP projects, which are clearly indicated in your Service
Level Agreement (SLA) with Neath Port Talbot County Borough Council.
The guide is split into five sections
Section 1
This provides a brief overview of the Rural Development Plan in general
Section 2
This looks at the Service Level Agreement. It discusses how the SLA works
and explains the various paragraphs contained in the SLA and aims to show
how this works in practice.
Section 3
This section is concerned with the monitoring of the project. As part of the
SLA we need to carry out various checks to ensure that the EC is getting
value for money. To do this, Project Managers need to have in place
monitoring systems and this section will cover the basis on how this is to be
achieved and advises on what information is required from Project Managers
to satisfy audit requirements
Section 4
This examines the interim and final claims. The RDP claim will form the
basis on how we monitor the activities of the project and check on its
progress. The guidance will run through the structure of the claims and
what’s expected of project managers in terms of providing feedback and
evidence in the required format.
Section 5
This covers the post completion and economic life. In some cases project
outputs may be delivered after the project completion and this section will
give further advice.
We hope you find this guide useful, but remember to contact us at the Lead
Body if you have any queries or concerns as soon as they arise.
CONTENTS
Section 1:
Overview of the RDP in general
Section 2: The Service Level Agreement
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General
EC Requirements
Customer Reference Number (CRN)
Public Procurement
EC Publicity Requirements
Auditor Requirements
Withholding or Repayment of Grant
Section 3: Ongoing Monitoring Requirements
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Setting Up Your Monitoring Systems
Record Keeping
List of Ineligible Expenditure
“In Kind” Expenditure
Apportioning project delivery staff salary costs
Double Funding
Involving Partners in the Monitoring Process
Private Sector Partners
Monitoring Visits
Project Outputs
Section 4: Submitting Interim and Final Claims
1.
Interim Claims
 Interim Claims and Progress Reports
 Notifying Changes
 Completing Claim Forms
2.
Final Claims
Section 5: Post Completion Monitoring
 Post Completion Monitoring
 “Economic Life”
SECTION 1: INTRODUCTION
What is the Rural Development Plan for Wales?
1.1 The Rural Development Plan for Wales (RDP) is jointly funded by the
European Union (EU) as part of the Common Agricultural Policy through
the European Agricultural Fund for Rural Development, and the Welsh
Assembly Government. It will run from 2007 and 2013.
1.2 Under the EU Rural Development legislation, the Welsh Assembly
Government aims to:
 Strengthen our farming and forestry industries in Wales
 Maintain and protect our environment and rural heritage
 Improve economic competitiveness of rural communities and areas
1.3
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There are 4 Axes under the Plan:
Axis 1 – Improving the Competitiveness of the Agricultural and
Forestry Sector
Axis 2 – Improving the Environment and the Countryside
Axis 3 – The Quality of Life in Rural Areas and Diversification of the
Rural Economy
Axis 4 – LEADER
1.4 Neath Port Talbot Regeneration Partnership’s Business Plan 1 and
Business Plan 2 are concerned with delivering activity through Axis 3 and 4.
Under the Business Plan 1 period (20 June 2008 – 28 February 2011), 6
projects were approved. Under the Business Plan 2 period (1 March 2011 –
31 December 2013), 4 projects have been approved.
1.5 This guide has been written by the Lead Body of the Partnership to
assist project sponsors deliver their projects in accordance with the rules and
requirements of the RDP. It also outlines your responsibilities to the
Partnership and theirs to you.
Role of the Lead Body
1.6 The role of the Lead Body is to oversee the delivery of the Local
Development Strategy and Business Plan, on behalf of the Partnership
including progress on individual projects, and ensure that the projects
supported underpin the overall aims and objectives. Neath Port Talbot
County Borough Council has been asked by the Partnership to undertake this
role.
1.7 As well as providing the Secretariat to the Partnership, the RDP Team
of Neath Port Talbot County Borough Council will be responsible for:
 Monitoring projects’ progress
 Assisting project sponsors implement their project in accordance with
the requirements of WAG and Europe
 Working with all projects to promote and publicise the work of the
Partnership
 Work with project sponsors to submit Project Amendment Forms in
good time
 Help sponsors establish systems to monitor their outputs and provide
the necessary evidence for audit purposes.
 Regular contract management and verification visits.
1.8 The team contained within the European and External Funding Team
will be responsible for:
 Working with the Partnership and Local Action Group to develop the
five themes of the Local Development Strategy, namely:
 Tourism
 Community Transport
 Healthy Living
 Environment
 Increasing Economic Prosperity
 Publicising the work of the Partnership and Local Action Group.
1.9 The role of the Claims and Monitoring Officer will be to ensure that
the grant is applied and used properly and within regulatory requirements in
compliance with grant terms and conditions and in accordance with funding
agreements, scheme guidance and all approved systems and procedures of
the Partnership.
 An RDP Team representative will undertake due diligence checks on
all project sponsors.
 Claims from project sponsors will be verified and paid.
 All supporting evidence will be checked to verify defrayment and be
certified.
 Regular meetings to discuss your progress
What are your responsibilities as Project Sponsor?
1.10
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Your responsibilities to the Partnership include those detailed below:
To deliver your project in line with the agreed SLA
To respond to queries from the Lead Body promptly
To work with the Lead Body to promote the Business Plan and work
of the Neath Port Talbot Partnership
 To meet with representatives of the Lead Body on a regular basis to
discuss project progress
 To provide reports to the Lead Body as and when required
 To attend Partnership meetings when required
SECTION 2: THE SERVICE LEVEL AGREEMENT
General
2.1 The Service Level Agreement sets out the conditions, on which the
grant offer is made, and outlines the claims and payment procedure. SLA’s
are long and, at first sight complicated documents, but essentially consist of
passages of ‘standard texts’ punctuated by project performance ‘variables’.
These define your project’s start and end date, how much you can spend and
on what activities, the outputs to be delivered and their achievement date,
and when/how you should claim grant. It is important that you understand
the following:
 The SLA is an agreement between you the organisation undertaking a
project, and Neath Port Talbot County Borough Council as the Lead
Body for Neath Port Talbot Regeneration Partnership. It becomes
binding once the SLA recipient has signed the letter to show that he/she
(understands and agrees with its terms. The signed copy of the SLA must
be returned to Neath Port Talbot County Borough Council by the
specified date, otherwise the offer is automatically withdrawn.
 If you do not meet the SLA’s conditions, grant can be withheld, or
reclaimed at any time.
2.2 Be sure that you understand, and can meet, all of the SLA
requirements. The Lead Body would have discussed specific elements of
your grant application for inclusion in the SLA so that you can discuss the
issues and implications with your legal and financial experts. This helps to
ensure that the formal SLA can be signed and returned without delay, and
that the Project Manager knows precisely what structures need to be put into
place in order to meet the various funding conditions.
2.3 Somebody in your organisation who has the authority to make the
necessary level of financial and legal commitment must sign the SLA.
2.4 The SLA sets out, amongst other things, project performance targets
(outputs), the maximum amount of EAFRD (European Agricultural Fund for
Rural Development) that may be paid, the grant rate, details of estimated
eligible costs, together with the expected phasing. This information is taken
from the WAG approved application form. You will be expected to
implement your project within these terms: if you do not, you run the risk of
losing some or all of the EAFRD. It is therefore important that you keep the
Lead Body fully informed of progress and, where relevant, discuss the need
for amendments in advance (see paragraphs 4.4 and 4.5 below).
European Commission (EC) Requirements
2.5 The ‘standard’ text in the SLA lists the European Community
regulations and policies that apply to all projects. These include references
to:
 The EAFRD Regulation – Council Regulation (EC) No 1698/2005
 Financing of Common Agricultural Policy – Council Regulation (EC)
No 1290/2005
 Regulation on the Eligibility of expenditure for measures co-financed by
the Structural Funds – Commission Regulation (EC) No 448/2004
 Regulation laying down detailed rules for the application of Council
Regulation (EC) No 1290/2005 as regards the accreditation of paying
agencies and other bodies and the clearance of the accounts of the EAGF
and EAFRD – Commission Regulation (EC) No 885/2006
 Regulation laying down detailed rules for the application of Council
Regulation (EC) No 1698/2005 on support for rural development by the
EAFRD – Commission Regulation (EC) No 1974/2006
 EC State Aid Rules
 Public procurement directives (see paragraphs 2.7 – 2.11)
 Environmental Legislation
 Publicity Requirements
2.6 Some of these issues – eg state aids and cross –cutting themes – are
considered when the application is assessed by WAG. Others, in particular
public procurement and publicity requirements are considered after approval,
as part of the claims and monitoring procedures. EAFRD will not be
released until the Lead Body is satisfied that these requirements have been
met, or that work is hand to ensure that they will be met.
Public Procurement
2.7 The European Community rules on Procurement apply to contracts
that are financed or part financed under the Rural Development Plan for
Wales 2007 - 2013. Within the coverage of the Directives set out below,
contracts above certain limits are required to be advertised in the Official
Journal (OJ) of the European Communities. Bids for contracts must be
assessed on an objective basis and contract awards should be published in
the OJ. Funding will be reclaimed if it is found subsequently that the
procurement rules have not been observed.
2.8 Organisations that are not financed or supervised by public sector
bodies and commercial organisations in the private sector may not be
covered by the procurement rules but are nonetheless expected to use fair
and open practices including competitive tendering when letting contracts
for which they intend to claim funding under the Rural Development Plan
for Wales 2007 - 2013.
2.9 If your organisation is not covered by the procurement directives we
expect the following procurement procedures (or equivalent) to be adopted
according to the estimated value (inc. VAT) of the contract at pre-tender
stage. Your decision must demonstrate best value and you must keep
records, which support your decision. We also expect that public sector
bodies awarding contracts below the thresholds to demonstrate best value for
instance by following these procedures.
Estimated
Value
Below £250
Tender Action Required
£250 up to
£500
£501 up to
£2,500
£2,501 up to
£15,000
£15,001 up
to £50,000
£50,001 and
over
Single oral quote
No quote required
Minimum of three oral quotes
Minimum of three written quotes, based on a clear written
specification of requirement
Normally minimum of 3 formal competitive tenders invited.
Normally 4 to 6 formal competitive tenders invited.
2.10 The rules relating to public procurement are complicated, and the SLA
should be studied closely. It is your responsibility to ensure that the
provisions are complied with. Your legal or specialist procurement
colleagues can advise you in detail on the procedures.
2.11 The European Commission’s auditors check very closely that the
public procurement regulations have been complied with. They look in
particular for attempts to bypass the relevant procedures, eg by artificially
splitting activities into separate contracts, such that the value of each contract
is below the relevant threshold. Where they consider that there has been an
infringement of the regulations, the EAFRD funding may have to be repaid.
ENVIRONMENTAL IMPACT
2.12 Environmental sustainability is a part of meeting wider sustainable
development targets. The Welsh Assembly Government has a duty,
enshrined in the Government of Wales Act, to promote sustainable
development without sacrificing the environment. All projects awarded
funding must comply with Environmental legislation. Grant aid may be
withheld until any necessary consents, including planning permission have
been obtained.
2.13 The UK wide approach to sustainable development recognises four
key priority areas:
 Climate Change and energy
 Sustainable consumption and production
 Natural resource protection and environmental enhancement
 From local to global: building sustainable communities
2.14 The Assembly Government has signed up to these key priorities.
There are of course many more detailed issues within each key priority, but
this is an important initial classification for evaluating the achievement of
environmental sustainability. In terms of plans and projects submitted for
funding it is clear that there are different levels of potential achievement in
respect of meeting environmental sustainability targets. To be both logical
and consistent these can be summarised at three levels:
 At the lowest level, Level 1, the project creates awareness of the
environmental consequences of what is proposed
 At the second level, Level 2, the project encourages or promotes
action to address environmental sustainability
 At the highest level, Level 3, the project achieves a measurable change
that enhances the environment or improves sustainability
2.15 All projects should meet the minimum standards of Level 1. More
progressive projects may meet Level 2 standards (desirable), and Level 3
standards (ideal).
2.16 Table 1 provides a general description of the type of activity within a
project that would enable it to meet the three different levels of achievement
for each key environmental sustainability priority.
Table 1: General description of levels of achievement
Level of achievement for each project
Key Priority for
Level 1
Level 2
Level 3
environmental
Create
Encourage
Achieve actual
sustainability
awareness
action
enhancement/
behavioural
change
1 Climate Change and Create
Actively
Achieve reduced
energy
awareness of
encourage
emissions, or
energy use
adaptation or
adaptation to
and climate
behaviour
climate change
change
change
2 Sustainable
Create
Actively
Achieve reduced
consumption and
awareness of
encourage new consumption or
production
consumption
products and
new ecoissues
lower
friendly
consumption
products
3 Natural resource
Create
Actively
Achieve
protection/
awareness of
encourage
environmental
environmental
the natural
sustainable
enhancement
enhancement
environment
management
4 Building sustainable Create
Actively
Empower local
communities
awareness of
encourage
people and
local
sustainable
achieve
community
local
community
issues
businesses and involvement
communities
For each project: Minimum
Desirable
Ideal standard
standard
standard
EC Publicity Requirements
2.17 All projects must acknowledge the support of the European
Community and Welsh Assembly Government on all literature and
marketing materials in accordance with Commission Regulation (EC) No
1974/2006 and Welsh Assembly guidance. The European Commission have
emphasised the importance of publicising European Community activity in
Member States, and undertake thorough checks at project level to ensure that
this is observed.
2.18 It is also a requirement of the SLA that all projects acknowledge the
support of Neath Port Talbot Regeneration Partnership and Neath Port
Talbot County Borough Council.
2.19 It is essential to make all beneficiaries/recipients aware that they are
participating in a scheme which is part financed by the European Union
through the Welsh Assembly Government.
2.20 It is a requirement that stationery templates need to be approved by
the Lead Body prior to printing.
2.21 Publicity shall include formal and informal announcements, press and
journal articles, press releases, media interview (television and radio) and
official launches and openings. Publications (such as booklets, leaflets and
newsletters) and posters about measures and actions part-financed by
EAFRD shall contain a clear indication on the title page of the Community’s
participation, as well as the European Union Emblem and WAG logo.
Publications shall include references to the body responsible for the
information content and to the Welsh Assembly Government.
2.22 Any information event including conferences, seminars and fairs and
exhibitions in connection with part financed operations should display the
European Union Emblem and Welsh Assembly Government logo in a
prominent place (for example, display /banner stands and literature and any
other publicity material used).
2.23 The European Union emblem should be used in full colour wherever
possible. A black and white version of the logo may be used in the event that
any element of the logo becomes illegible or with prior approval from the
Managing Authority. The European Union logo has no minimum or
maximum size restriction, but it must be reproduced to a satisfactory quality
when enlarged and fully legible when reduced.
2.24 On websites specifically, the contribution made by EAFRD must be
mentioned on the homepage and there must be a web link to the EU
Commission’s rural development page:
http://ec.europa.eu/agriculture/rurdev/index_en.htm
2.25 Publicity Responsibilities of Beneficiaries
 Where an operation under a rural development programme results in an
investment (for example, on a farm or on food enterprise) whose total
cost exceeds EUR 50,000, the beneficiary shall place an explanatory
plaque
 A billboard shall be erected at the sites of infrastructures whose total cost
exceeds EUR 500,000
 An explanatory plaque shall be erected at the sites of infrastructures
whose total cost exceeds Euro 500,000
 The billboards and plaques shall carry a description of the
project/operation and the European Union Emblem and slogan. The part
showing the European support must take up at least 25% of the billboard
or plaque.
2.26 Some or all of the funds awarded may be reclaimed if the support
from the European Community is not acknowledged in accordance with
Annex VI of EC Regulation 1974/2006.
Inspection Requirements
2.27 The SLA contains provisions covering the inspection of your project.
Representatives of The Lead Body, the Welsh Assembly Government, the
Wales Audit Office, the European Commission or the European Court of
Auditors may inspect your project at any time. It is therefore essential that
you have structures in place that clearly shows all the expenditure and
outputs relevant to your project. .
2.28 The key to successful inspections is preparation. The Welsh
Assembly Government are only required to give you 48 hours notice of their
intention to undertake an audit. It would be beneficial to understand and
plan for what is expected of you in terms of documentation so that you are
confident that you can deal with their questions straight away.
2.29 To assist with this, you should undertake a ‘mock inspection’ as this
often highlights practical problems that are easy to overlook however well
you have planned. The Lead Body will be looking to undertake ‘mock
audits’ with all projects as soon as it is practical. This will also help to
spread best management practices.
2.30 The Project Manager should explain the inspection procedures to any
partners involved in delivering a project, to ensure that they are using
compatible operating systems and that they can provide the necessary
documentary evidence of expenditure and outputs.
Withholding or Repayment of Grant
2.31 The SLA explains the circumstances in which EAFRD may be
withheld or recovered. By ensuring that you have sound administrative and
monitoring arrangements in place from the start, you will minimise the risk
of this happening. You should inform Neath Port Talbot Lead Body at
the earliest opportunity of any problems with the project, including
actual or possible under (or over) spends, difficulties in achieving agreed
outputs, or slippage to the project’s timetable.
2.32 If identified and released promptly, it may prove possible to reallocate
underspends to other projects, and so ensure that precious EAFRD resources
continue to benefit the rural areas of Neath Port Talbot County Borough.
The discipline of providing quarterly claims will encourage you to keep your
expenditure and progress constantly under review.
2.33 Listed below are the circumstances in which the Partnership could
withhold funding, or require you to repay grant
a.
A check by the Lead Body, the Welsh Assembly Government, the
National Audit Office, Wales Audit Office, the European Commission or the
European Court of Auditors or any of their representatives, identifies
circumstances whereby a full or partial repayment of funding is due, or, if
the Commission otherwise requires the funding to be withheld, reduced,
cancelled or recovered;
b.
The assistance exceeds European Community State Aid limits or if the
European Community Authorities judge that any funding paid should not
have been paid; or if a decision of the European Court of Justice requires
payment to be withheld, reduced, cancelled or recovered;
c.
There has been an overpayment of funding;
d.
Funding is not used for the purposes described in the project
application;
e.
There is a change that the Partnership considers to be substantial in the
nature, scale of costs or timing of the project or if there has been a change in
any of the factors on which the original funding was calculated;
f.
The Partnership considers the future of the project to be in jeopardy;
g.
Any information provided in application for funding or in subsequent
or supporting correspondence is found to be substantially incorrect or
incomplete;
h.
There is unsatisfactory progress towards completion of the project or
if the projects are not completed by the end date specified in the Project
Funding letters;
i.
There is unsatisfactory progress towards meeting the forecast outputs
specified in the Project Funding letters;
j.
During their economic life, the project undergoes substantial change
defined as being used for purposes other than those specified in the
application, or, having a change of owner without notifying the the
Partnership. The economic life is the period up the last payment of funding
or achievement of the last of the targets specified in the Project Funding
Letter or 5 years from date of the Project Funding letter whichever is the
later;
k.
Within the period beginning on the date on the start of your SLA and
during the lifetime of the project any of the following events occur, the
project sponsor must inform the Partnership as soon as possible:
 you or a final recipient ceases to be a subsidiary of any company of which
it is a subsidiary at the date of the SLA or becomes a subsidiary of any
company of which it is not a subsidiary at the date of the SLA. The word
“subsidiary” shall be interpreted in accordance with the definition in
Section 736 of the Companies Act 1985 as substituted by Section 144(1)
of the Companies Act 1989;
 you or a final recipient is the subject of a proposal for voluntary
arrangement or has a petition for an Administration Order or a petition for
a Winding-Up Order brought against it or passes a resolution to wind-up
or makes any composition, arrangement, conveyance or assignment for
the benefit of its creditors or purports to do so, or if a receiver or any
other person is appointed in respect of its undertaking or any of its
property.
SECTION 3: ON-GOING MONITORING REQUIREMENTS
Setting Up Your Monitoring Systems
3.1 The previous section stressed the importance of setting up good
administrative and monitoring systems for your project as early as possible.
Active project monitoring commences as soon as you have signed the Offer
Letter (and sometimes even before that).
3.2 The RDP Application form required you to address in broad terms the
basis for monitoring a project’s performance. Any substantial changes to
these procedures should be agreed in advance with the Lead Body.
3.3 There is no prescribed best method of setting up and running projects
attracting EAFRD grants: there are simply too many different types of
activity and possible delivery structures. A common sense approach that
endeavours to keep structures as simple as possible is usually best. You will
find reporting and monitoring the project much easier if you keep separate
records for the project, eg by setting up a separate cost code for the project.
3.4 In the past some project managers have run into serious difficulties by
failing to separate project expenditure from other activities. This has caused
long delays in grant payments. It would be beneficial to keep all of the
records concerning a project in one place rather than splitting documents
between different departments in an organisation.
Record Keeping
3.5 You must keep accurate and up-to-date records. You are required to
maintain original documents relevant to your project at least until six years
after the last payment of funding made to you. Bear in mind the
possibility of unforeseen disturbances, eg staff changes or relocation of
records, and endeavour to have procedures in place to ensure continuity.
3.6 In the past a number of projects have run into serious difficulties
because a Project Manager has moved on and left no clear records.
Documents should establish a clear chronological trail that explains how
each decision relating to a project has been reached and enables a thorough
audit of activity.
3.7 As a minimum, all expenditure relating to the project, down to the
smallest transaction must be recorded. Output records will vary according to
the nature of the activity, for assistance please contact the Lead Body.
3.8 These are the principal documents that you should have available for
inspection:
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A copy of the approved application form
Any correspondence detailing changes to the approved application
The signed SLA/Offer Letter
Contracts let and procedures followed
Copies of planning/related consent where appropriate
State aid notification, where appropriate
Publicity material (eg brochures, letterheads, photographs, press-cuttings
– with reference to RDP contribution)
Claim forms and associated correspondence
Information to verify outputs
Records of payments generated by the project – ie income*
Original invoices and/or other documents demonstrating expenditure,
including payroll records, cheque numbers on invoices paid by cheques*
Records of payments made through your bank accounts*
Written confirmation of match funding from third parties
Any legal agreements with third parties
Committee reports on the project (where appropriate)
Auditors’ statements
Annual reports or project impact evaluations
Details of monitoring procedures
Information to support any changes made to the project.
* All financial transactions must be clearly traceable through your
financial accounting system.
3.9 The SLA stresses that you must comply, within a reasonable period,
with any request for information concerning the progress of your project.
You must be prepared for an audit or monitoring visit at any time, so it is
imperative that you have a clear and up-to-date records system.
‘In-Kind’ Expenditure
3.10 In-kind matchfunding is the contribution of a service or product by an
individual or organisation where the cost cannot be traced back to a cash
transaction by the project deliverers, project sponsors or partners.
All in-kind costs must be eligible costs that relate to the delivery of the
project. In the project financial tables, the in-kind cost will appear on the
expenditure side and will be exactly balanced by a corresponding in-kind
matchfunding figure.
3.11 Article 54 of Commission Regulation 1974/2006 sets out the
Commission’s requirements related to in-kind matchfunding contributions.
It states that:
“for measures involving investments of any kind, contributions of a public or
private beneficiary, namely the provision of goods or services for which no
cash payment supported by invoices or equivalent documents is made, may
be eligible expenditure provided that the following conditions are fulfilled”.
i) The contributions consist in the provision of land or real estate,
equipment or raw materials, research or professional work or
unpaid voluntary work.
ii) The contributions are not made in respect of financial engineering
actions referred to in Article 50.
iii) The value of the contributions can be independently assessed and
verified.
3.12 In the case of provision of land or real estate, the value should be
certified by an independent qualified expert or duly authorised official body.
3.13 In the case of unpaid voluntary work, the value of the work shall be
determined taking into account the time spent and the hourly and daily
rate of remuneration for equivalent work. The acceptable rates for
voluntary work are as follows:
Role
Notional hourly
rate
Project Manager
£16.76
Project Co-ordinator
£13.13
Project Researcher
£13.13
Trainer
£13.13
Project Administrator
£9.38
Unskilled Labour (21 and over)
£5.93
Unskilled Labour (aged 18-20)
£4.92
Workers aged under 18 but above compulsory school £3.64
aged (16)
3.14 In addition to these rates it is also possible for projects to include costs
of more specialist and technical roles. The proposed specialist rate would
need to be agreed with the Welsh Assembly Government before the activity
commenced. The project would be expected to keep clearly documented
justification for the specialist rated, eg if the volunteer has existing paid
employment equivalent to the technical/specialist tasks undertaken in the
voluntary work, it would be acceptable to use that pay rate, provided
sufficient evidence existed to support this.
3.15 Time sheets should be maintained to support the hours claimed
towards the project. A template is included in Appendix 1. This shows the
minimum amount of information that must be collected.
3.16 Only volunteers acting in a wholly voluntary capacity will be eligible.
Any paid employee of the project who performs additional ‘voluntary’ duties
will not be eligible unless it can be clearly demonstrated that the activities
are additional to those contained in the person’s job description.
3.17 Establishing a clear audit trail for in-kind contributions is not always
easy, but the key thing is that you record and monitor the contribution in
accordance with the approved application and offer letter. For instance,
when submitting a claim that includes volunteers’ hours, you will need to
multiply hours actually worked during the claim period, cross-referenced to
time sheets, by the hourly rate agreed in the offer letter. When in-kind
contributions are provided by a third party, they will need to provide written
confirmation of the basis on which they have been valued.
Apportioning project delivery staff salary costs
3.18 This is the recognised apportionment technique for calculating the cost
of staff that do not spend all of their time on the project. It can be used for
all staff, but it is shown here only for those staff that deliver the project. The
following formula should be used to calculate the actual hourly rate for each
individual involved with the project.
Step 1:
Calculate the number of days a full time (or part time
proportionally) member of staff will work in a whole year.
Example 1
Working days are 5 days per week x 52 weeks per year
Less public holidays
Less annual leave
Total working days =
260
- 9
-28
223
NB: There is no allocation for any down time or sickness
Step 2:
year:
From this you can calculate the number of hours worked in a
Example
Total working hours per year (based on the usual organisation contractual
working day) are:
223 days x 7.4 hours per day = 1650 hours per year
Step 3:
From this if you divide the total cost for the period by the actual
hours worked it will give you the hourly rate:
Example
Total salary cost for the year is £19,976 (including employers NI
contributions & superannuation or pension costs for the project period).
This must be the actual salary paid. Every month the following
calculation should be made (Actual monthly salary including on-costs
multiplied by 12 to give the annual salary).
£19,976 divided by 1650 hours = £12.10 per hour
Step 4:
You can then multiply this hourly rate by the actual project
hours worked (as evidenced by timesheets) to give the individuals’ total cost
for the project. A calculation to show the apportionment of the actual salary
costs for the individual on the project is below:
Example 2
RDP hours are:
20 hours per week x 24 weeks
Total RDP hours
The individual’s cost to the project is:
480hours x £12.10 hourly rate =
480 hours
480 hours
£5,808.00
NB: The staff time of 480 hours would have to be evidenced by
timesheets that cover the agreed full time hours of that staff member for
the total period claimed. This is to ensure no over-recovery of staff time
as a result of staff working on multiple projects. Should this occur, an
adjustment each year should occur and be evidenced.
Double Funding
3.19 If you are running more than one project receiving European financial
assistance, you must establish direct audit trails according to the
requirements of each scheme. This should help you demonstrate that
funding sources are not being mixed (ie that you are not using the same
funding source to attract grants into different projects), or that you are not
matching one European grant with another (eg from Convergence). EARFD
cannot be matched with either European Social Fund (ESF) or
European Regional Development Fund (ERDF).
Involving Partners in the Monitoring Process
3.20 Partners include any third party that is responsible for implementing a
part of the project, and therefore make payments attracting ERDF grant.
This would include beneficiaries of a Key Fund scheme. The SLA recipient,
ie the Project Sponsor, is responsible for ensuring that project partners are:
 Aware of the EAFRD Offer Letter conditions, and are familiar with
monitoring/audit processes and requirements;
 Able to provide the necessary information at the correct time for each
claim; and are
 Keeping detailed financial records and information to support progress
and outputs detailed on the claim forms.
3.21 Project Managers run the risk of getting into difficulties if they cannot
enforce compliance with the Offer Letter terms. Problems securing
information from a partner is not an acceptable excuse for late submission
of claims. There needs to be some sort of contract or formal agreement
between the partners. These agreements should spread project risk amongst
the partners, provide a mechanism for compliance by all parties with the
SLA terms (including grant recovery), and ensure the provision of match
funding (where appropriate).
Private Sector Partners
3.22 The claim form requires you to report on any private sector
contributions towards the eligible expenditure on the project. Over the life
of the project, this should be in line with the amount predicted in the
application.
Monitoring Visits
3.23 The Lead Body will undertake regular monitoring visits. They will
undertake a standard series of checks, look at the monitoring systems that are
in place and check physical progress on site where appropriate. It is
important to note that these are monitoring, not audit, visits. As well as
allowing the Lead Body to verify that a project is progressing satisfactorily,
and to offer any assistance required, the visits also allow Project Managers to
show what they have achieved, how effective their systems are, or to discuss
the need to make possible amendments to the SLA.
3.24 Following the site visit, the Lead Body will write a short report
summarising their main findings and listing action points. A copy is sent to
the Project Manager.
Project Outputs
3.25 The SLA sets out the performance targets against which your
project will be measured. The performance indicators need to be reported
against quarterly.
3.26 It is important that the WAG agreed definitions are adhered to in
terms of measuring outputs. The relevant definitions are attached to your
Project Offer Letter. For further advice, please contact the Lead Body.
3.27 Remember, you must show progress against your agreed outputs
in order for your claims to be paid.
3.28 Outputs must be supplied with the claim form or no payments will
be made.
SECTION 4: SUBMITTING CLAIMS
Eligible expenditure
4.1 You must comply with the EC Regulations on eligible expenditure
which are in the annex to EC Regulation 448/2004. The EC may issue
further regulations on this. In addition you should comply with the
following definition of eligible expenditure.
4.2
Eligible expenditure must:
(1) not exceed the amounts stated in the SLA;
(2) be expenditure relating to the cost headings approved in your SLA;
(3) not be expenditure on the costs described as ineligible at 4.22; and
(4) be project costs which have been paid by you or any 3rd party
organisations and final recipients making payments for the projects
(defrayment).
4.3 Whilst every effort will be made to ensure that all eligible claims for
funding are processed and paid when submitted, The Lead Body reserves the
right to refuse a claim or delay payment until a later time for budget
management purposes.
How to Claim
4.4 All organisations/individuals receiving funding under the Rural
Development Plan for Wales 2007 – 2013, including Key Fund recipients
must have a Customer Reference Number (CRN). This applies to the final
beneficiary of the grant, including beneficiaries of Key Funds. The CRN
application form is attached at Appendix 2. Please note you must complete
the CD(W) form which will be sent to you directly from Rural Payments in
order to finish the process and allow the Lead Body to make payments to
you. Please contact the Lead Body if you require any clarification on this
4.5 You should complete and submit quarterly in arrears the claim form
provided by The Lead Body.
4.6 You must submit your claims to the Lead Body by the due date. The
Lead Body reserves the right to refuse a claim or delay payment of any late
claims submitted.
4.7 On receipt of claims, the Lead Body will check them and arrange to
visit you to certify all expenditure. This will entail the representative
seeing all original documentation, invoices, bank statements, ledger prints
etc. These must be available at the time of the visit to enable the
representative to certify all documentation.
Failure to provide the
documentation could result in expenditure being disallowed. To enable the
smooth running of this process, a simple spreadsheet showing how the claim
is calculated and which invoices relate to which heading would be
appreciated.
4.8 If you are running a Grant Fund, claims submitted by you to the Lead
Body must also be supported by the claims received by you from final
recipients (grant recipients). The same level of detail is required for each
grant recipient’s claim as detailed above. You also need to ensure that the
CRN for each final recipient is included on the claim form.
4.9 Subject to you submitting a fully completed claim form and all
required supporting documentation, and to your compliance with the terms
and conditions set out in the SLA and its annexes, the Lead Body will make
every effort to pay claims for funding within 30 days of its receipt of the
completed claim and supporting documentation, but accepts no liability in
respect of loss attributable to delay in the payment of claims or to any
suspension, reduction or cancellation of funding.
4.10 The Lead Body is under no obligation to pay any claims for payment
until activities, for which paying is being claimed, have been completed to
its satisfaction and satisfactory supporting documentation has been provided
to the Lead Body with the claim.
4.11 The funding allocated to each project cannot be carried forward into
subsequent financial years without the Lead Body’s prior written approval.
All requests must be made by 31 December.
4.12 Before submitting your claim form to the Lead Body, you should
verify the following for all final recipient claims and supporting
documentation:
i. the delivery of the products and services funded by the project;
ii. the reality of the expenditure claimed; and
iii. the activities for which funding is being claimed compared with the
activities described in the project application
iv. All original supporting documentation need to be retained by you
until the Lead Body has certified them.
4.13 Any apportioned expenditure must clearly show the apportionment
method used. If you have multiple invoices that use the same apportionment
method then a spreadsheet showing the apportionment method should be
attached to that batch of invoices.
This must be done with every claim submitted. Use of “see last claim” is not
acceptable and will result in claims being delayed/reduced. The Lead Body
must agree apportionment methodology before it being used to agree
compliance and consistency.
4.14 Expenditure categorised under overheads must have previously been
declared when costs were being agreed with WAG. Any direct costs should
not be included in the overhead category. All apportionment methods need
to be shown on the invoices or batches as in 4.13 above.
4.15 The apportionment methodology must be used consistently throughout
the lifetime of the project.
4.16 Expenditure shown on claims must relate to project costs that have been
defrayed. “Defrayed” is defined as when a project has given money for
goods and/or services and the money due has passed out of the project’s
bank by the time it is included in a claim for grant. In the UK the point at
which this occurs is when the money has transferred to the supplier from the
project’s bank account and appears on the project’s bank statement. As an
example, for expenditure in relation to goods and/or services provided to the
project by a supplier to be included in a claim for grant, an invoice must
have been received, a transaction entered into the project’s accounts and a
cheque or equivalent cashed by the supplier. The date the cheque or
equivalent is cashed will be the payment date.
4.17 You must return your claim form to the Lead Body even if no claim
for funding is being made and you should submit your outputs and a written
progress report.
4.18 The total funding payable over the life of the project will be restricted
to the total amount shown in your project funding letter and all other levered
funding contributions must be made to the project before the end of the
project.
4.19 Levered Funding contributions made to the project by other
organisations must be declared to the Lead Body on the next quarterly claim
submitted following receipt of the levered funding contributions. Proof of
levered funding needs to be provided with the claims, including bank
statements if appropriate.
4.20 The Lead Body will examine the claims and supporting
documentation submitted by you and establish the amounts that are
eligible for support. It shall establish:
i. the amount that is payable to you based solely on the payment claim;
ii. the amount that is payable to you after examination of the eligibility
of the payment claim;
4.21 If the amount established pursuant to paragraph 4.20(i) exceeds the
amount established pursuant to paragraph 4.20(ii) by more than 3%, the
Lead Body will apply a reduction to the amount payable to you pursuant to
paragraph 4.20(ii). The amount of reduction shall be the difference between
the two amounts.
4.22 No reduction will be applied if you can demonstrate that you are not at
fault, or any 3rd party organisations or the final recipient is not a fault, for the
inclusion of the ineligible amount.
4.23 For capital expenditure claimed, the Lead Body will undertake at least
one visit to the project to verify the realisation of the capital investment.
You should provide the following as supporting documentation with the
quarterly claim to the Lead Body:
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
date of purchase;
description of investment;
price paid net recoverable VAT;
amount of funding from the RDP paid;
location of the title deeds;
serial or identification numbers;
location of the investment;
4.24 For capital expenditure claimed a certificate of progress/completion
should be submitted with the claim to the Lead Body.
4.25 For capital assets purchased via this funding, whether owned by you
or a 3rd party delivery organisation or final recipient, you must ensure that
the assets are used for the purpose approved under this letter or the Project
Funding letter for a minimum of 5 years from the date of the final
payment made to you or the final recipient, whichever is appropriate.
4.26 If any asset during the 5 years fixed period:
a) undergoes a substantial modification that affects the nature or
implementation conditions or gives undue advantage to a firm or
public body, or;
b) as a result of a change in the nature of ownership of an asset, or the
disposal or relocation of the asset, there is a change to the use of
the asset from that approved under this letter or the Project Funding
Letter
Repayment of funding will be required as follows:
Date of disposal of asset(s)
Within 1 year
Within 2 years
Within 3 years
Within 4 years
Within 5 years
After 5 years
Amount to be repaid
Funding to be repaid in full
80% of funding to be repaid
60% of funding to be repaid
40% of funding to be repaid
20% of funding to be repaid
No funding to be repaid
Inventory of Assets
4.27 You must establish and maintain an inventory of all assets acquired,
built, or improved wholly or partly using funding under the Rural
Development Plan for Wales 2007 - 2013, whether owned by you or third
parties. An asset is defined as an item that will not be used up within 12
months and which is not intended to be sold before the end of its useful life.
Assets below £1,000 (excluding VAT) can be excluded.
4.28 The inventory should show the:
date of purchase;
description of asset;
price paid net recoverable VAT;
amount of funding under Axis 3 paid;
location of the title deeds;
serial or identification numbers;
location of the asset;
date of disposal; and
sale of proceeds net of VAT.
4.29 List of ineligible expenditure
 Overheads allocated or apportioned at rates materially in excess of those
used for any similar work carried out by the applicant
 Costs incurred prior to 1st March 2011
 Notional expenditure
 Payments for activity of a political nature
 Depreciation, amortisation and impairment of assets purchased with the
help of grant
 Provisions
 Contingent liabilities
 Contingencies
 Profit made by the applicant
 Dividends
 Interest charges unless under an approved State Aid scheme
 Service charges arising on finance leases, hire purchase and credit
arrangements
 Costs resulting from the deferral of payments to creditors
 Costs involved in winding up a company
 Payments for unfair dismissal
 Payments into private pension schemes
 Payments for unfunded pensions
 Compensation for loss of office
 Bad debts arising from loans to employees, proprietors, partners directors,
guarantors, shareholders or a person connected with any of these
 Payments for gifts and donations
 Entertainments
 Reclaimable VAT
 Statutory fines and penalties
 Criminal fines and damages
 Legal expenses in respect of litigation
The above list is not exhaustive but provides the main topics, if you have
any doubt please contact the Lead Body for advice and guidance.
Section 5: Post Completion Monitoring
Economic Life
5.1 The SLA specifies a period during which the ‘project’ must be used
exclusively for the purposes specified in the SLA. This is known as the
project’s economic life.
5.2 For revenue projects, the economic life is identical to the period
during which the project actually spends.
5.3 For capital assets purchased via this funding, whether owned by the
Project Applicant or a 3rd Party delivery organisation or final recipient, you
must ensure that the assets are used for the purpose approved under the SLA
for a minimum of 5 years from the date of the final payment made to you or
the final recipient, whichever is appropriate.
5.4
If any asset during the 5years fixed period:
a)
undergoes a substantial modification that affects the nature or
implementation conditions or gives undue advantage to a firm or public body
or;
b) as a result of a change in the nature of ownership of an asset, or the
disposal or relocation of the assets, there is a change to the use of the
asset from that approved
Repayment of funding will be required as follows:
Date of disposal of asset(s)
Within 1 year
Within 2 years
Within 3 years
Within 4 years
Within 5 years
After 5 years
Amount to be repaid
100%
80%
60%
40%
20%
0
CONTACTS
European Unit:
All Enquiries to
rdp@npt.gov.uk
01639 686076
Helen May RDP Team Leader
01639 686076
h.may@npt.gov.uk
Rachel Jenkins Claims and Monitoring Officer
01639 686389
r.jenkins2@npt.gov.uk
Andrew Hall RDP Assistant
01639 686909
a.hall2@npt.gov.uk
APPENDICES
Appendix 1:
Example Timesheet
Appendix 2:
CRN Application Form
Appendix 3:
Examples of Backing Documentation for Claims
Appendix 4:
Annex A – Quarterly Claim Profile
Appendix 3
Examples of Backing Documentation for Claims
General expenditure, ie purchase of an item of equipment etc
1.
Invoice
2.
Bank Statement – proving date of defrayment
3.
Purchase Ledger Extract
Salaries
If Paid by Cheque:
1.
2.
Bank Statement – proving defrayment date for both payment date to
employee and Inland Revenue
Payroll Extract
If paid by BACS:
1.
Breakdown of the BACS run – proving defrayment date for both
payment to employee and Inland Revenue
2.
Payroll Extract
3.
Bank Statement
Items purchased via Credit Card
1.
2.
3.
Credit Card statement showing the original purchase transaction
Credit Card statement proving defrayment – please note credit card
purchases cannot be considered defrayed until the credit card balance
has been paid in full.
Bank Statement showing payment to Credit Card Company.
Overheads
1.
2.
3.
Invoices for all transactions included in claim/calculation
Bank Statement
Ledger Extract
PLEASE NOTE THIS LIST IS INTENDED AS A GUIDE AND
ADDITIONAL DOCUMENTATION MAY BE REQUIRED IN SOME
INSTANCES. ALSO, SOME ORGANISATIONS MAY NOT HAVE A
LEDGER AND THEREFORE THIS DOCUMENT WILL NOT BE
REQUIRED