CRZM GJ Proiect RO 2002/000- 586.05.02.02 - 162 1 European Structural Funds and its Programme,...

CRZM GJ Proiect RO 2002/000-586.05.02.02 - 162

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European Structural Funds and its Programme, Grants, and

Project Cycle Mangement

Romania, September , 2005

CRZM Gorj & DFC Corporate Solutions

Proiectul “Centru de consiliere si sprijin pentru intreprinzatori”

Phare RO-2002/000-586.05.02.02-162,

UNIUNEA EUROPEANA GUVERNUL ROMANIEI


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Table of ContentsPART I

1. Definitions and Terminology of EC funded Projects2. Main Financial Support Programmes and Iniciatives for Members and non-

members States3. Structures and key procedures of the European Structural Funds and EC

Iniciatives4.Tools and Techniques for Various types of Project preparation and

management

PART II

5. Overview of the EC Project Cycle Management 6. Project Identification, Formulation and Analysis Tools8. Project Planning Tools9. Project Fiches and Terms of References10. Implementation, Monitoring and Evaluation11. Economic and Financial Analysis of Projects12. Conclusions

PART I

THE EU FINANCIAL SUPPORT PROGRAMMES


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The EU Budget 2000 - 06 Average annual budget 100.400 million €

Common Agricultural Policy

Internal Market Policies

External Actions/EUROPEAID

Administration

Reserves

Pre Accession/Phare, ISPA, Sapard

Enlargement/New Members

42.4%

30.3%

4.6%4.8%

0.6%

3.1%8.3%

STRUCTURAL AND COHESION FUNDS

6.0%

•The EU Budget finances Internal Actions, Structural and Cohesion, the CAP, External Actions, Enlargement Pre-Accession and Administration - this amounts to around 100 billion EUR per year/ 200 billion for Structural and Cohesion funds for the 7 years.

Definitions and Terminology of EU- Funded Projects


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E. Commission Budget

Temporary Human

Resources

Loans and Shareholdings

Studies and Direct Actions

Structural and Financial

Support Programmes

Paid directly to the beneficiary

by the Commission

Paid to the beneficiary indirectly, either through a Member State, a foreign

government, or an agency appointed by a State, in decentralized programmes

(transfers)

Introduction: Review of European Structural Funds and other external Programmes

Common Agricultural

Policy- Guidance section

Of the overall EC Budget, spent in grants, tenders and studies are most of the structural funds and other financial support schemes, the CAP-

Guidance section, and Studies and direct actions


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European Commission

European Commission

National –decentralised management

Direct Actions (Pilot,

Innovative….)E. Commission management

Mixed management

Programmes, actions and other support activities

called and negotiated directly

in Brussels

PUBLICATION: E.U. Official

Journal

Management and Official

Announcement: Commission

Structural and Cohesion Funds:

ERDF, ESF, Fisheries and

EAGGF

PUBLICATION: in national and

regional Journals


Announcement:

National Government and Regions (RDAs)

E.U. Initiatives: 5% of Structural funds

PUBLICATION: E.U. Official Journal,

National Journals


Announcement: Commission plus

Regional and national units of

coordination

Budgetary lines, funds not

exhausted, pilot projects

Publication in EU website

Management and PUBLICATION:

Commission and European Parliament

EU Grants and Programmes


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The EU Budget : Main support programmes and initiatives

• Indirect Support Programmes: - Specific budget assigned to Member States- Member States must propose their budget support priorities

- EU Commission can accept ,reject or adapt MS´s proposals)

• Direct Support Programmes:

- Directly applied to EU Administration

- Proposals to Brussels / Luxemburg

- Support Funds and Programmes given to the best projects, Europe wide


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Main support programmes and initiatives

Direct Support Programmes

• EC Initiatives (5% of Structural funds)

• Direct Programmes – Framework programme R+D (now to the VIIth)– TEN-TELECOM– LIFE– ALLURE– SAVE– LEONARDO– ALFA– JOPP – ECIP– CDI


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Main support programmes and initiatives

Direct Support Programmes (2)

– ENTERPRISE INNOVATION– EUROPARTENARIAT– ETP - Japan– PHILOXENIA - Tourism– CULTURE 2000– EURATHLON– ENVIROMENTAL NGO´s GRANTS– MEDIA– etc...


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Structural & Cohesion Funds

• Indirect Funds : - Specific budget assigned to Member States

- Member States must propose their budget support priorities

- EU Commission can accept ,reject or adapt MS´s proposals

- Some budget funds applied directly to EU commission managed projects (ex.european key road network)

- The rest of fund programmes ,managed by National and /or Regional Administrations

Purpose: reduce developmet and and life condititons disparities among Member States..Convergence


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• 1999 Reform Objectives:

- Improve Efficiency of Structural Support Measures: - More focus and concentration,- Beurocratic simplification- Decentralization of management

- Maintain Economic and Social Cohesion Support

- Include Regional Cohesion Financial support to future Member States


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ERDF ESF

EAGGF

FIFG

STRUCTURALFUNDS

(Obj.1, 2, 3)

COHESION FUNDS < 75% average GDP26,5 M EUR for 2000/6 195 M EUR for 2000/6


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Structural Funds 2000- 06

Reserves for effective projects (4%)

General Programmes (90%), as presented in General Community Support (GCS) or the Single Programming Document (SPD) (for small countries)

Community Initiatives (5,35%): measures proposed by the EC and managed jointly: they are four in 2000/06; Interreg III, Urban II, Equal , Leader+. They are planned to disappear in 2006?

Innovative actions (0,65%), Pilot Projects and studies

These funds are partially disbursed by national and regional governments as tenders, grants, studies and other forms of financial support.


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Structural Funds

• There are 4 Structural Funds namely:

- European Agricultural Guidance and Guarantee Fund (EAGGF);

- Financial Instruments for Fisheries Guidance (FIFG);

- European Regional Development Fund (ERDF);

- European Social Fund (ESF).

Adjoining the four Structural Funds, the Cohesion Fund provides structural assistance to the four least developed Member States - Portugal, Spain, Greece and Ireland, financing projects concerning the environment or transport infrastructure. The Transition Facility Fund is targeted to enhance the capacity building of Accession States


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Structural Funds

• European Regional Development Fund (ERDF): Aims to reduce socio-economic imbalances between regions of the Union: essentially it is aimed at business growth and economic regeneration.

• European Social Fund (ESF): Aims to put people into employment by developing skills and training opportunities by supporting: Active labour market policies; Equal opportunities for all and promoting social inclusion; Improving training and education and promoting lifelong learning; Adaptability and entrepreneurship; Improving the participation of women in the labour market.


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Structural Funds

European Agricultural Guidane and Guarantee Fund (EAGGF) It is included within the CAP ,and Aims to finance rural development projects ,such a s young farmers,,investments and training, rural product marketing,and rural areas development. (including the LEADER+ ,EU Initiative).

• Financial Instruments for Fisheries Guidance (FIFG)

Aims to finance fleet modernization,fishing quotas programmes,protection specail marine cultivation ,area protection.It is an instrument to complement the Overall EU Fishing Policy.Marketing and Promotion of products,Port infrastructure investment


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Structural Funds

• Funding: Between 2000 and 2006, 95% of the Structural Funds finance, is distributed according to, the EU's 3 'Objectives‘, of which, 5% is allocated on community initiatives.

• Objective 1 is funded by ERDF: Allocated to regions where gross domestic product per head is less than 75% of the EU average.

• Objective 2 is funded principally by ERDF and also by ESF: The Funds aim to help reduce the gaps in socio-economic development between the various regions and member states. It covers 18% of the European population.

• Objective 3 is funded by ESF: The objective is aimed at funding training and skills development.


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Structural Funds

(% )

69,7

11,5

12,3 0,5

Objective 1 Objective 2Objective 3 Fisheries

195.00O Million € ,2000-06


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SAMPLE EC PROGRAMMES

EUROPEAN COMISSION

EUROPEAID

•Tacis

•ALA

•Meda

•Cards/ EAR

•FED

DG ENLARGEMENT

•Phare (incl. Twinning)

•ISPA

•Sapard

•Transition facility

DG REGIO

• Structural funds

•Interreg III

• URBAN

DG RESEARCH DG ENTERPRISE DG EDUCATION

VIth Framework Pr. Competitiveness & Entrepreneurship Leonardo

Innovation, etc Tempus, etc.

DG EMPLOYMENT, etc.

•Social Fund

•Equal

DG AGRICULTURE

•Leader +


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Proposed SF Budget 2007 - 2013

• Discussions of the new 2007-13 Budget are still on-going, with the following last proposals by the EC (Billion EUR):

•Regions subject to statistical effect: 22.14•Cohesion Fund: 62.99•Special programme for outermost regions: 1.1•Regions outside convergence: 48.31•‘Phasing- in’ for regions that were Objective 1 between 2000- 2006: 9.58•Cross-border cooperation: 4.7•External borders: 1.6•Transnational cooperation: 6.3•Networks: 0.6•Regions below 75 % of average GDP (Obj. 1): 177.8

TOTAL 2007-13 : 336.1 Billion EUR

•EAGGF, FIFG and the Initiatives disappear, with only ERDF, ESF and Cohesion Fund remaining, plus a fund for cross-border cooperation (EGCC).

How much will Romania finally get?


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Structural Funds

• Clarity – Member States & enterprises must understand why an incentive has been introduced, what it seeks to achieve and the activities it is able to support

• Simplicity – The incentive should not be too complex to administer. It should be simple and fast to apply as otherwise the take-up rates would be low

• Certainty – Mechanisms must be put in place to limit the amount that an incentive will cost. Enterprises need to obtain a quick decision from Member States as to whether an activity qualifies for support or not


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Structural Funds

• Compliance – Any scheme must comply with relevant national and EU legislation in force, including EU State Aid

• Non-discriminatory - Schemes should not benefit one firm at the expense of another, nor adversely distort existing market factors

• Effectiveness – A measure of the number of benefiting firms, a method of impact assessment and cost monitoring


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Structural Funds

• All programmes co-financed within SF,are responsability of the Institutions of the State Members.They propose and classify the projects within the National/Regional Strategic Plans and select the best projects.

• All projects financially supported by EU,must be co-financed by local public or private sector.

• The Follow up Committee supervises and controls the implementation.

• SF are not reimbursable.

• In each Member State ,social and economic players can propose and obtain SF support ,through the appropriate authorities on each Programme.


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Structural Funds

EUROPEAN COMMISSION

STATES AND ITS REGIONS

FOLLOW UP COMMITTEES

Negotiates, approves, assigns& pays

manage, select, Implement &evaluate

Follow up

MANAGEMENT AUTHORITIESApplication of

Programme complement


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Structural Funds

• 1.- EU Commission decides SF Regulations.

• 2.- EU Commission designs Priorities for each Objective.

• 3.- Member States design their own National Strategies and negotiate with the EU Commission their own priorities, financial assignments and implementation rules.

• 4.- Documents for Programming:

They describe the socio-economic context of the country or of the target regions of the SF ,according with the EU Objectives,pointing out priorities,objectives,management and financial tools,implementation,evaluation and control systems.


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Structural Funds

• 5.- Member States create a document for each Programme called:Programme Complement, elaborated by the Institution that manages them locally.

• 6.- Annual Management Report

• 7.- Follow up Committee Report


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Structural Funds

Co-financing– Objective 1: up to 75% total cost, and minimum 50% public expenses

in some cases, the % can reach 80 y 85% for certain Regions of a State under Cohesion Fund or in ultra-peripheral Regions or Greek peripheral isles.

– Objective 2 and 3: up to 50% of the project total cost.

– A limit for investments in income generating infrastructures :

• 50% States beneficiaries of Cohesion Fund

• 40% in all other regions under objective 1

• 25% in subvention able areas according to objective 2


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Cohesion Fund

• It is a tool to enhance the economic and social cohesion among EU Countries,helping less developed ones within the EU.

• The CF for 2000-06 is 18.000 million €.

• Beneficiaries of CF are those countries with a GNP lower than 90% of the EU average,and follow a plan for economic convergence: Ireland,Spain,Greece,Portugal.

• Condition: If Beneficiary countries of the CF have an excessive public deficit,CF are “frozen” until it is remedied.


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Cohesion Fund

• Financial projects fall into two categories:

– Environment: Projects that contribute to the overall EU objectives in Environmental Policy.

Priority is given to drinkable water supply, residual water treatment,and solid waste management.Reforestation ,erosion control and protection of the environment are also eligible for finance.

– Infrastructure of Transport Projects

• The financial support goes up to 80-85% total of Public investment cost.

• The presentation of projects to Brussels is made exclusively by the Country Government.


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Contracting and implementing of EU programmes Contracting and implementing of EU programmes Contracting and implementing of EU programmes Contracting and implementing of EU programmes

European Union D.G. European Union D.G.

AREAS OF INTERVENTION

Services, Works & Goods (tenders) or

Grants

Implementors of projects (private sector, regional

and local administrations)

Calls for proposals:

DUTIES OF TASK MANAGER (OFFICER)

•Definition and design of contents

•Technical aid to projects

•Monitoring and evaluation

•Administrative and technical control

•Facilitates the relationships with

DUTIES OF TASK MANAGER (OFFICER)

•Definition and design of contents

•Technical aid to projects

•Monitoring and evaluation

•Administrative and technical control

•Facilitates the relationships with

Contracted by the corresponding Directorate General or Implementing

Agency

Contracted by the corresponding Directorate General or Implementing

Agency


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Structural Funds :Community Initiatives

• They are special Interventions by the EU Commission ,proposing them to the Member States .These programmes can be applied throughout the EU territory and are co-financed with SF ,with the aim to solve specific problems.

• In the 2000-2006 period 4 Community Initiatives have approved.Each financed with Structural Funds:

• INTERREG III: cross-border cooperation, trans-national and interregional (ERDF).

• URBAN: regeneration of urban deteriorated areas (ERDF).

• LEADER+: rural development (EAGGF).

• EQUAL: against discrimination in labour market (FSE).


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A lump sum not exceeding 7% of the direct eligible costs of the Action may be claimed as indirect costs to cover the administrative overheads incurred by the Beneficiary for the Action.

Indirect costs are eligible provided that they do not include costs assigned to another heading of the contract budget.

Indirect costs are ineligible if the Beneficiary receives in other respects an operating grant from the European Commission.

This does not apply in the case of an operating grant.

Eligible indirect costs (overheads)


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• EU investment participation is:– 35% in regions objective 1.– 15% in zones eligible of objective 2


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• They have a budget of 10.440 million €, that is to say, 5,3% of total Budget of Structural Funds

• They Special EU Commission interventions for specific problems.

• They have 3 characteristics,that give them added value versus the rest of the support tools of the Structural Funds:

• Enhancement of cross-border, trans-national cooperation.European integration and convergence

• Intense participation of economic and social agents.• Promote the real cooperation among all participants.


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Community Initiatives : Interreg III

EU Community Initiative to promote integration and balanced development of the EU territories,where national borders must not be an impediment

Areas Objective 1 : up to 75% and 2 : up to 50

Beneficiaries: maritime,interior border regions 1. Interreg A: Cross-Border Cooperation2. Interreg B: Transnational Cooperation3. Interreg C: Inter-regional Cooperation

Approach: Nature,Heritage,SME´s,work integration,sharing R+D and Culture,small infrastructures,legal and administrative cooperation,Transport,Experiences exchange,Tourism,Maritime cooperation.Bottom-up

Selection criteria: unemployment,low income,social problems,environment

Budget : 4.875 + 480 PHARE million €


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EU Community Initiative to regenerate socially and economically towns and/or neibourghoods to promote a sustainable development,by using innovative strategies in medium and small towns.

Areas Objective 1 : up to 75% and 2 : up to 50%

Beneficiaries:Affected population per project :min 10.000

Approach: innovative solutions to existing problems

Selection criteria: unemployment,low income,social problems,environment

Budget : 700 million €

Community Initiatives : Urban


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EU Community Initiative to fight all forms of discrimination and inequality in labour market ,especially for asylum seekers

Areas Objective 1 : up to 75% and 2 : up to 50% Beneficiaries: geographical and sector Development Associations • Facilitate access to employment to handicapped people• Fight racism and xenophobia• Promote entrepreneurship• Reinforce social economy

Selection criteria: cross-border cooperation,training,innovation,intergated focus ,equal opportunities men and women.

Budget : 2.847 million €

Community Initiatives : Equal


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EU Community Initiative to promote integrated development in rural areas

Areas Objective 1 : up to 75% and 2 : up to 50% Beneficiaries: Rural areas 10.000-100.000 inhabitants .Local Action

Groups(all socialeconomic groups)• Coherent strategy for the territory• Interaction of different groups,network creation• Upgrade natural and cultural heritage• Help create jobs,better comunity organization,partnerships

Selection criteria: to be established by state members,and always in rural areas.

Budget : 2.020 million €

Community Initiatives : LEADER+


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State Aid Regulations: DG Internal Market/Competition

• Of course, whenever designing or launching a new scheme with SFs or other EC programmes, the authorities have to check that EC State Aid rules are met.

• This is very important once you are a Member of the EC, it is a cat-and-mouse game between national and regional bodies and EC officials as to the interpretation of the Rules. Fights and investigations are commonplace.

• Essentially simple: “De Minimis” rule applies (less than 100,000 EUR of aid in three years to a single firm or related firms, which is generally enough for most SMEs). All aid beyond that has to be justified ex-ante (better) or ex-post (when fairly sure, and unlikely the first few years after Accession). This can be done by ANMMIC, the RDAs, Counties, Associations, or whoever proposes a scheme within a grant application to benefit SMEs, cooperatives or self-employed.

• .


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State Aid Regulations

• General Summaries (SCAD) of State Aid regulations- http://europa.eu.int/scadplus/leg/en/s12002.htm

• - State Aid “De Minimis” Rule: http://europa.eu.int/scadplus/leg/en/lvb/l26065.htm

• - State Aid SME Block Exemption: http://europa.eu.int/scadplus/leg/en/lvb/l26064.htm

• - State Aid Training BE: http://europa.eu.int/scadplus/leg/en/lvb/l26063.htm

• - State Aid Employment BE: http://europa.eu.int/scadplus/leg/en/lvb/l26091.htm

• - State Aid in Agriculture (SCAD)- http://europa.eu.int/scadplus/leg/en/s12006.htm

• - State Aid in Energy (SCAD) http://europa.eu.int/scadplus/leg/en/s1400EC

• - State Aid in Transport- http://europa.eu.int/scadplus/leg/en/s12005.htm

• - State Aid in Telecoms - http://europa.eu.int/scadplus/leg/en/s21012.htm#CADREJUR


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•Any EC grant funded by Structural funds or by direct Actions must fall between a range with a minimum and maximum amounts

•A grant may not be for less than 50 % of the total eligible costs of the Action. In addition, no grant may exceed 75 % (for Obj.1, with some exceptions going to 85% or even 100%) of the total eligible costs of the action.

•The balance must be financed from the applicant's or partners' own resources, or from sources other than the European Community budget. WB and bilateral funds are accepted, if properly negotiated.

•Example of call for proposal for a grant from DG Enterprise: http://europa.eu.int/comm/enterprise/funding/grants/themes_2005/calls_prop_2005.htm

GRANTS from SF: Size of EC grants


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• There are sets of eligibility criteria, relating to organisations which may request a grant, actions for which a grant may be awarded, types of cost which may be taken into account in setting the amount of the grant.

1. Eligibility of applicants: who may apply

2. Partnerships and eligibility of partners

3. Eligible actions: actions for which an application may be made

4. Eligibility of costs: costs which may be taken into consideration for the grant

Eligibility criteria


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1. Eligibility of applicants: who may apply- generally:

Non-profit-making legal persons

Organisations with their headquarters in the European Union

Be directly responsible for the preparation and management of the action, not acting as an intermediary

Eligibility criteria:


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Partnerships and eligibility of partners

Applicants may act individually or in consortium with partner organisations; or, if partnership is obligatory under the programme, applicants must act in consortium with partner organisations.

Other organisations may be involved in the action. Such associates play a real role in the action but may not receive funding from the grant. Associates do not have to meet the eligibility criteria, however, they must fulfil the general eligibility criteria. Subcontractors are neither partners nor associates, and are subject to differents rules. The applicant will act as the lead organisation and, if selected, as the contracting party (the "Beneficiary"), private bodies will usually be subcontractors.


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Eligible actions: actions for which an application may be

made

•DurationThe duration of an action may not exceed a number of months •Sectors or themesDescription of the specific sectors or themes to which the actions must relate•Location•Actions must take place in one or more of the EU / Pre-accession countries: • Type of actionsDescription of the type of actions which may be financed under the programme. The following types of action are ineligible: individual sponsorships for participation in workshops, seminars, conferences, congresses, individual scholarships for studies or training courses;


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Cost Eligibility

Eligible direct cost

Ineligible costs

Eligible indirect costs (overheads)

Contributions in Kind


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To be eligible under the call for proposals, costs must:

be necessary for carrying out the action,

have actually been incurred by the beneficiaries or their partners during the implementing period for the action;

be recorded in the Beneficiary's or the Beneficiary's partners' accounts or tax documents, be identifiable and verifiable, and be backed by originals of supporting documents.

Eligible direct costs


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Normally eligible direct costs include:

the cost of staff assigned to the action, corresponding to actual salaries plus social security charges and other remuneration-related costs;

travel and subsistence costs for staff taking part in the action,;

the cost of purchasing equipment (new or used) and services, provided they correspond to market rates;

the cost of consumables and supplies;

subcontracting expenditure;

costs arising directly from the requirements of the contract (dissemination of information, evaluation specific to the action, audit, translation, printing, insurance…) including financial service costs (in particular the cost of transfers and financial guarantees).

Eligible direct costs


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The following costs are not eligible:

debts and provisions for losses or debts; interest owed; items already financed in another framework; purchases of land or buildings, except where necessary

for the direct implementation of the action, in which case ownership must be transferred to the final beneficiaries at the end of the action;

currency exchange losses; taxes, including VAT, unless the Beneficiary (or the

Beneficiary’s partners) cannot reclaim them and the applicable regulations authorise coverage of taxes.

Ineligible costs


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Any contributions in kind made by the Beneficiary or the Beneficiary’s partners, which must be listed separately (Budget), do not represent actual expenditure and are not eligible costs. They may not be treated as co-financing by the Beneficiary.

However, the Beneficiary must undertake to make such contributions as stated on the application form if the grant is awarded.

Contributions in kind


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Application forms and supporting documents

Applications must be submitted on the application form annexed to these Guidelines. The application form is also available on the Europa web site.

Applicants should keep strictly to the format of the application and fill in the pages in order.

Complete the application form carefully and as clearly as possible so that it can be assessed properly. Be precise and provide enough detail to ensure the application is clear, particularly as to how the aims of the action will be achieved, the benefits that will flow from it and the way in which it is relevant to the programme's objectives.

Hand-written applications will not be accepted.


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Applications must be accompanied by the following supporting documents:•The statutes or articles of association of the applicant organisation and where appropriate, of each partner organisation;The applicant’s most recent annual report and accounts (the profit and loss account and the balance sheet for the previous financial year);

•Where the grant requested exceeds EUR 300 000 , an external audit report produced by an approved auditor, certifying the accounts for the last financial year available and stating to what extent the applicant has stable and sufficient sources of finance to maintain its activity.

•Other supporting documents required ( see format)

Supporting documents


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Applications will be examined and evaluated by the contracting authority with the possible assistance of external assessors. All actions submitted by applicants will be assessed according to the following criteria:

1. Administrative compliance

Verification that the application is complete in accordance with the checklist.

2. Eligibility of the applicants, partners and actions

Verification that the applicant, the partners (and the associates whereapplicable), and the action are eligible according to the criteria set out

in the notice

Evaluation and selection of applications


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• Selection criteria are intended to help evaluate the applicants' financial and operational capacity to ensure that they:

have stable and sufficient sources of finance to maintain their activity throughout the period during which the action is being carried out and, where appropriate, to participate in its funding;

have the professional competencies and qualifications required to successfully complete the proposed action. This also applies to any partners of the applicant.

• The award criteria allow the quality of the proposals submitted to be evaluated in relation to the objectives and priorities set, and grants to be awarded to actions which Maximise the overall effectiveness of the call for proposals.•They cover such aspects as the relevance of the action, its consistency with the objectives of the call for proposals, quality, expected impact, sustainability and cost effectiveness.

Evaluation and selection of applications


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Section Maximum

Score

Application

Form

1. Financial and operational capacity 20

1.1 Do the applicant and partners have sufficient experience of project management?

5 II.4.1 and III.1

1.2 Do the applicant and partners have sufficient technical expertise?(notably knowledge of the issues to be addressed.)

5 II.4.1 and III.1

1.3 Do the applicant and partners have sufficient management capacity? (including staff, equipment and ability to handle the budget for the action)?

5 II.4.2 and III.1

Example of scoring matrix


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Section Maximum

Score

Application

Form

2. Relevance 25

2.1 How relevant is the proposal to the objectives and one or more of the priorities of the call for proposals?

5 I.1.6(a)(b)

2.2 How relevant to the particular needs and constraints of the target country/countries or region(s) is the proposal?

5 I.1.6(c)

2.3 How clearly defined and strategically chosen are those involved (intermediaries, final beneficiaries, target groups)?

5 I.1.6(e)

2.4 Have the needs of the target groups proposed and the final beneficiaries been clearly defined and does the proposal address them appropriately?

5 I.1.6 (c)(f)

2.5 Does the proposal contain specific elements of added value?

5 Passim



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Section Maximum

Score

Application

Form

3. Methodology 30

3.1 Are the activities proposed appropriate, practical, and consistent with the objectives and expected results?

5 I.1.7

3.2 How coherent is the overall design of the action? 5 I.1.8

3.3 Is the partners' level of involvement and participation in the action satisfactory?

5 I.1.8(e)

3.4 Is the target groups' and final beneficiaries' level of involvement and participation in the action satisfactory?

5 I.1.8(e)

3.5 Is the action plan clear and feasible 5 I.1.9

3.6 Does the proposal contain objectively verifiable indicators for the outcome of the action?

5 Logframe



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Section Maximum

Score

Application

Form

Sustainability 15

4.1 Is the action likely to have a tangible impact on its target groups?

5 I.2.1

4.2 Is the proposal likely to have multiplier effects?

5 I.2.2 & I.2.3

3 Are the expected results of the proposed action sustainable:

- financially (how will the activities be financed after the EC funding ends?)

- institutionally (will structures allowing the activities to continue be in place at the end of the action? Will there be local “ownership” of the results of the action?)

5 I.2.4



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Section Maximum

Score

Application

Form

Budget and cost-effectiveness 10

5.1 is the ratio between the estimated costs and the expected results satisfactory?

5 I.3

5.2 Is the proposed expenditure necessary for the implementation of the action?

5 I.3

Note: Maximum Total score 100



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•The Beneficiary usually receives some pre-financing. If the overall duration of the action does not exceed 12 months or if the grant does not exceed EURO 100 000, the pre-financing will be 80% of the grant.

•If the overall duration of the action exceeds 12 months and if the grant exceeds EUR 100 000, the first pre-financing instalment will be 80% of the forecast budget for the first 12 months of the action). In that case, subsequent pre-financing payments may be made upon submission by the Beneficiary, and approval by the contracting authority, of an interim report and a work plan and budget for the following period.

•The final balance will be paid upon submission by the Beneficiary and approval by the contracting authority of the final report Payments will be made to an Action-specific bank account or sub-account which identifies the funds paid by the Contracting Authority

•The Beneficiary must keep accurate and regular records and dedicated, transparent accounts of the implementation of the action It must keep these records for seven years after payment of the balance.

Payments


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Audit

An external audit of the accounts of the Actions implemented must be attached to:

any request for a further pre-financing payment if the sum total of the earlier and the new pre-financing payments exceeds EUR 750 000;

any request for payment of the balance in the case of a grant of more than EUR 100 000;

any payment request of over EUR 75 000 for the financial year,

in the case of an operating grant;


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Example of Action Work Plan

Year 1

TIME Semester 1 Semester 2 Implementing body

Activity 1 2 3 4 5 6 7 8 9 10 11 12 Example

Example Local partner 1

Execution Activity 1(title)

Local partner 2

Preparation Activity 3 (title)

Local partner 1

Etc.


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Checklist

the dossier is complete and complies with the application form's requirements one original and […] copies of all documents are annexed

an electronic copy of the file is enclosed where required

the dossier is typed and is in [language]

the declaration by the applicant (per diem) is signed and attached

if there are partners, the applicant has completed and signed a partnership statement, also included

each partner has completed and signed a partnership statement and the statements are included

the budget and the expected sources of funding are presented in the format of the application form, completed and drawn up in <Euro>

in the budget <the Contracting Authority>'s contribution is identified and is a maximum of […]% of the total eligible costs of the action

in the budget, overheads do not exceed 7 % of direct eligible costs

the logical framework matrix for the Action is included if requested


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Annex B. Budget for the Action1

Expenses Unit # of units Unit # of units

1. Human Resources

1.1 Salaries (gross amounts, local staff)4

1.1.1 Technical Per month 0 Per month 0 1.1.2 Administrative/ support staff Per month 0 Per month 01.2 Salaries (gross amounts, expat/int. staff) Per month 0 Per month 0

1.3 Per diems for missions/travel5

1.3.1 Abroad (staff assigned to the Action) Per diem 0 Per diem 0 1.3.2 Local (staff assigned to the Action) Per diem 0 Per diem 0 1.3.3 Seminar/conference participants Per diem 0 Per diem 0Subtotal Human Resources 0 0

2. Travel6

2.1. International travel Per flight 0 Per flight 02.2 Local transportation Per month 0 Per month 0Subtotal Travel 0 0

3. Equipment and supplies7

3.1 Purchase or rent of vehicles Per vehicle 0 Per vehicle 03.2 Furniture, computer equipment 0 03.3 Spare parts/equipment for machines, tools 0 03.4 Other (please specify) 0 0Subtotal Equipment and supplies 0 0

4. Local office/Action costs8

4.1 Vehicle costs Per month 0 Per month 04.2 Office rent Per month 0 Per month 04.3 Consumables - office supplies Per month 0 Per month 04.4 Other services (tel/fax, electricity/heating, maintenance) Per month 0 Per month 0Subtotal Local office/Action costs 0 0

5. Other costs, services9

5.1 Publications10 0 0

5.2 Studies, research10 0 05.3 Auditing costs 0 05.4 Evaluation costs 0 05.5 Translation, interpreters 0 05.6 Financial services (bank guarantee costs etc.) 0 0

5.7 Costs of conferences/seminars10 0 05.8 Visibility actionsSubtotal Other costs, services 0 0

Costs (in

EUR)3Unit rate (in

EUR)

All Years Year 12

Costs (in EUR)

Unit rate (in EUR)

Example of Action Budget


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Complete Research

LOGICAL FRAMEWORKIntervention Objectively verifiable Sources and means of Assumptions

logic indicators of achievement verificationOverall What are the overall broader What are the key indicators relatedWhat are the sources ofobjectives objectives to which the action to the overall objectives? information for these indicators?

will contribute?

Specific What specific objective is the Which indicators clearly show What are the sources of Which factors and conditions outsideobjective action intended to achieve to that the objective of the information that exist or can be the Beneficiary's responsibility

contribute to the overall objectives? action has been achieved? collected? What are the methods are necessary to achieve thatrequired to get this information? objective? (external conditions)

Which risks should be takeninto consideration?

Expected The results are the outputs envisaged to What are the indicators to measureWhat are the sources of What external conditions must be metresults achieve the specific objective. whether and to what extent the information for these indicators? to obtain the expected results

What are the expected results? action achieves the expected on schedule?(enumerate them) results?

Activities What are the key activities to be carried outMeans: What are the sources of What pre-conditions are required beforeand in what sequence in order to produce What are the means required to information about action the action starts?the expected results? implement these activities, e. g. progress? What conditions outside the Beneficiary's(group the activities by result) personnel, equipment, training, Costs direct control have to be met

studies, supplies, operational What are the action costs? for the implementation of the plannedfacilities, etc. How are they classified? activities?

(breakdown in the Budget for the Action)

Example of Logframe Matrix- Action


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Examples of some regional Programmes

funded by Structural Funds


67

Origin and purpose of the SAVE Energy Agencies (Intelligent Energy for Europe):

• The project of the creation of the regional, provincial and/or local SAVE Energy. These Agencies have its legal framework within the program of Intelligent Energy for Europe (IEE). IEE, on the other hand, has various sub programs, including the SAVE program. This program’s objective is to encourage and strengthen the energy efficiency and energy savings measures.

• At the same time, it also pays special attention to the technological advances in the field of energy efficiency and the renewable energy sources. The EU also uses the agencies to indirectly influence the environmental impact and the security of the energy supply, two elements high up on the scale of the EU energy priorities.

SAVE Programme.Creation and establishment of SAVE Energy Agencies


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The SAVE programme objectives:

• Stimulate the energy efficiency measures in all sectors.• Promote and encourage the investment in the energy conservation on behalf of

the individual and public consumers as well as large industrial consumers• Reduce the overall energy consumption influencing the demand size of the

consumption– This the basis which the SAVE program uses when it decides to

finance creation of any Energy Agency. – Its goal is to improve upon energy management at the regional,

provincial and even local level by encouraging a better cohesion and coordination between the different European regions on the questions of energy.

– Its mission is to stimulate a top-down approach towards the energy management. It does so by developing actions of a local or regional character, using the available energy resources and the creation of the conditions for the adequate energy supply at the local level.



69


Functions of the SAVE Energy Agencies: •Provide information, assessment, training and education dealing with energy management and the associated measures and techniques. •Supply technical advising with regards to the preparation of projects dealing with the energy management•Get together the citizens and organizations with identical and/or similar Problems•Perform energy audits for the local energy producersContribute to the launch of local energy related projects (wind turbine energy parks, mini electrical plants, etc).•Stimulate the economic activities related to energy.•Act as the intermediates between the regional and/or local authorities on the energy market•Develop the relevant EU energy contacts in order to stimulate the exchange of information and the transfer of technology.


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SAVE Programme.Creation and establishment of the SAVE Energy Agency

Target beneficiaries of the SAVE Agencies:

•Residential housing. •Public and private services sector.•Small and medium sized enterprises.•Local or regional development and planning for energy saving.•Energy efficiency of the Transport sector. •Infrastructure of the local and regional administration towards energy efficiency. •Energy supply, including the development of the regional energy•Systems using renewable resources at the local level.


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•The EU Commission has financed the set-up of the energy saving agencies which, among other objectives, try to maximise the efficiency of the energy usage. For this purpose, the EU Commission fixed a financial contribution of 200.000 Euro for a period of three years. This amount was set independently of the total budget of the project which could be, and usually was, several times higher.

•The financing was meant to support the establishment of the agency and to finance its personnel cost, elements absolutely essential for its launch, and to help co-finance the programs that each of the agencies has set to execute through its correspondent work program. •Of course, the EU Commission finances only those agencies whose objectives correspond to the stated overall and specific objectives of the EU Commission of energy efficiency.

SAVE Programme.Creation and establishment of the SAVE Energy Agency


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Technology programme.Laboratory for Shoe cluster

Example: Aragon region, Laboratory for Quality Shoes in Aranda

ERDF-funded programme, yet helped design and within the policies of the Directorate-General for Enterprise (technology centres), aims to provide assistance and encouragement for small and medium-sized companies within the framework of a policy designed to strengthen the fabric of Spanish SMEs.

Objective: To improve the competitiveness and quality of SME Shoes Industries via the promotion of the implementation of innovative systems with a Laboratory (small technology centre) for quality, training, etc.

Centre should deploy ICT and innovative management and production and design techniques. The Centre defined four support programmes : design; quality systems; inter-company co-operation networks; and process innovation - centred mainly on aspects of SME management and organisation.


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Technology programme.Laboratory for Shoe Cluster

Aragon region- Laboratory for Quality Shoes in Aranda

Beneficiaries: SMEs in Aragon of the leather and shoe sector, through their local shoe manufacturers association. Eligible expenses: External consulting costs, related services, technical equipment for laboratory and computers. Excluded were the investment in the buildings, furniture and operating costs. Procedures:With the laboratory the Aragon shoes industries have a tool for analysing the raw material and to improve the manufacture of shoes.And with the laboratory the SME Aragon Shoes getting a similar quality of final product in the differents industries.

Programme costs, total funds of EU (ERDF) 50%: 240.500 EUR . Total costs of centre EUR 481.000 EUR for set-up. The centre later applied for R&D grants, regional grants, etc., for operational phase.


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The following limits apply to EC contracts:

Up to 50.000 EUR contracts, Commission Framework

Contract (short list of 3) or direct award

Up to 200.000 EUR contracts, AMS Framework Contracts or

restricted bidding (short list of 3 within Lot of Framework)

Above 200.000 EUR contracts, Awarded after international

tender in EuropeAid (shortlist of 5 to 8)

Classification of the tendering processes for technical assistance (services)

PART II

EC PROJECT CYCLE MANAGEMT


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OVERVIEW OF EC PROJECT CYCLE MANAGEMENT

What is a project?

ISO/PMI: “A series of activities aimed at achieving one or more specific objectives within a defined time

frame and with a defined budget”

EC: “A project is an instrument which is used to contribute to the achievement of a larger goal

(e.g. a programme), which will in its turn supports the implementation of a broader policy”


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What are project monitoring and evaluation?

Monitoring (EC): « To assess whether the project is reaching and/or is likely to reach

its objectives and results in a timely and efficient way »

Evaluation (EC): « To assess whether the project has had impact intended and

reached its purpose and results in a timely and efficient way »


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The EC External Aid Project Cycle

Programming

Identification

FormulationImplementation

Evaluation& Audit


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The EC Project Cycle

EC: “The way in which projects are planned and carried out; it follows a sequence beginning with an agreed

strategy, which leads to an idea for a specific action, which then is formulated,

implemented, and evaluated with a view to improve the strategy and define further

action”


80

Project Cycle Management

« The management activities and the decision-making procedures used during the life-cycle of a project, including key

tasks, roles and responsibilities, key documents and decision options »


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PCM is used to ensure that:

projects are supporting predefined overarching policy objectives; projects are relevant to an agreed strategy and to the real problems of the target groups/beneficiaries; projects are feasible meaning that objectives can be achieved given the constraints of the operating environment; benefits are likely to be sustainable.


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The essential PCM principles are:

use of Logical Framework Approach (LFA) to formulate the project and analyse the problems; production of good quality key documents in each phase to ensure structured and well-informed decision making; consulting and involving key stakeholders as much as possible.


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Key documents in the PCM:

Programming

Identification


Evaluation

Programming

Identification


Evaluation

Decisions to take Documents to produce

CountryStrategy Paper

Priority areas,Sectors,timetable

Which optionsto studyfurther

Pre feasibilitystudy

ProjectIdentification

Sheet

Feasibilitystudy

FinancialProposal

Decisionon funding

FinancingAgreement

Progress& Monitoring

Report

Decision whether tocontinue as plannedor reorient the project

EvaluationReport

Decisionon how to use results

for planning


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What is Programming?

For EC development assistance:establishment of general guidelines and principles for EU co-operation with a country

For other types of EC programming:establishment of main development priorities

Project Identification, Formulation and Analysis


85

What is Identification:

To add more details to the output of the programming phase by:

identifying project ideas consistent with the set priorities;assessing their relevance and the feasibility;preparing a detailed Financing Proposal (MEDA and Tacis) or Project Fiche (ALA or ACP);preparing a financing decision for a Programme or projects, or call for further studies/analyses


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Identification and Formulation Tools: • The core tools of the Identification and Formulation

phases are:

1. Quality Assessment Criteria

2. Logical Framework Approach (LFA)

3. Institutional Capacity Assessment

4. Promoting Participatory approaches

5. Preparation of Terms of Reference

6. Identification, Action Programme and Project Fiche

7. Economic and Financial Analysis


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Identification: Assessment Criteria and Standards

A. RELEVANT1. Consistent with EC development and cooperation policies2. Consistent with partner government policies and sector programmes3. Key stakeholders identified, institutional issues and local ownership 4. Problems appropiately analysed5. Lessons learned from experience and linkages to other projects and programmes

incorporated

B. FEASIBLE6. Preliminary objectives are clear and logical, address needs7. Preliminary resource and costs clear and economic-financial analysis carried out8. Preliminary coordination and financing arrangements clear and support

institutional strengthening9. (Not applicable to formulation)10. Assumptions and risks identified and appear reasonable11. Likely to be environmentally, technically and socially sustainable

C. WELL-MANAGED• 16. Good practice principles of PCM applied by EC task managers


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Identification: Outputs

• Information produced at end of Identification

phase: 1. Policy and programme context (Partner and EC)

2. Stakeholder analysis

3. Problem analysis

4. Lessons learned and review of other planned initiatives

5. Preliminary project description

6. Indicative resource and costs implications

7. Indicative coordination and management (including controls)

8. Preliminary assessment of economic/ financial, environmental, technical and social sustainability

9. Workplan for Formulation stage • With the following outputs:

– - Terms of reference for EC-funded Feasibility studies (Framework contracts)– - Identification Fiche, with Draft Terms of Reference for feasibility or design – - A Financing Proposal for a programme or a package of projects (Action programme

with Project Fiches)


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Formulation Phase: objectives

confirm the relevance and feasibility of the project ideas as presented in the initial identification fiche;prepare a detailed project design;prepare a financing proposal.


90

Information elements produced at the end of the project

Formulation/design phase:

Situation Analysis/Assessment;Project Description;Management Arrangements; Feasibility and Sustainability.


91

Situation Analysis/Key assessment:

Policy and programme contentStakeholder analysis & institutional capacity assessmentProblem analysisLessons learnedStrategy selection


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Project Description:

Overall objective and purposeTarget group, location and durationResults and indicative activitiesResources and costs


93

Management Arrangements:

Coordination and management structuresFinancial management/financing arrangementsMonitoring, evaluation and audit tools


94

Feasibility and Sustainability:

Economic and financialEnvironmentalTechnicalSocial and governanceRisk management


95

Implementation:

deliver the results, achieve the purposed and

contribute to the overall objective of the project;manage the resources efficiently;monitor and report on progress


96

Evaluation:

Evaluation is an assessment, as systematic and

objective as possible, of an on-going or

completed project, programme or policy, its

design, implementation and results. The aim is

to determine the relevance and fulfilment of

objectives, developmental efficiency,

effectiveness, impact and sustainability


97

Evaluation

An evaluation can be done during implementation

(mid-term), at its end (final evaluation) or

afterwards (ex-post evaluation), either to help

steer the project or to draw lessons for future

projects and programming


98

Principles underpinning Evaluation:

impartiality and independence (implementation from programming);credibility of the evaluation (skilled experts, transparency, dissemination);participation of the stakeholders to ensure different perspective;usefulness (through timely presentation of relevant, concise and clear information to key decision makers).


99

The main tools supporting Project Cycle Management:

The Project Fiche - or Terms of reference;The Project Logframe Matrix- especially to help assessing what has been achieved against plan;Monitoring reports;Evaluation reports- intermediate and final.


100

Monitoring and evaluation: scope and differences

Input, activities, results

WHEN?

WHY?

WHO?

Link to LF

Criteria

on-going

internal management responsibility

check progress, take remedial action, etc

relevance, efficiency, and effectiveness

usually incorporates external inputs

periodic, mid term, completion, ex-post, on-

going

Lessons learnt

results, purpose, overall objective, relevance

impact and sustainability

EVALUATION MONITORING


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What do we mean by RELEVANCE?

the appropriateness of project objectives to the problems that it was supposed to address, and to the physical and policy environment within which it operated, and including an assessment of the quality of project preparation and design – i.e. the logic and completeness of the project planning process, and the internal logic and coherence of the project design


102

What do we mean by EFFICIENCY?

The fact that the Results have been achieved at reasonable cost, i.e. how well inputs/means have been converted into Results, in terms of quality, quantity and time, and the quality of the Results achieved. This generally requires comparing alternative approaches to achieving the same outputs, to see whether the most efficient process has been adopted


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What do we mean by EFFECTIVENESS?

An assessment of the contribution made by Results to achievement of the Project Purpose, and how Assumptions have affected project achievements


104

What do we mean by IMPACT?

The effect of the project on its wider environment, and its contribution to the wider sectoral objectives summarised in the project’s Overall Objectives, and on the achievement of the overarching policy objectives of the EC


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What do we mean by SUSTAINABILITY?

An assessment of the likelihood of benefits produced by the project to continue to flow after external funding has ended, and with particular reference to factors of ownership by beneficiaries, policy support, economic and financial factors, socio-cultural aspects, gender equality, appropriate technology, environmental aspects, and institutional and management capacity


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Link with Logframe Matrix

Have and will products and benefits be maintained?

Which benefits on society and sector?

How well did the results contribute to the achievement of the project purpose?

How were the inputs and activities converted into results?

Quality of planning and adaptation, including relevance of problems to correct beneficiaries, OVIs, means, cost, assumptions, risks

relevance

efficiency

effectiveness

impact

sustainability

Means +Pre-conditions

Activities +Assumptions

Results + Assumptions

Project purpose + Assumptions

Overall objectives

change

utilisation

action

allocation


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Logical Framework Approach

It is an analytical process and a set of tools developed to support project planning and managementIt allows information to be analysed and organised in a structures way so that important questions can be asked, weaknesses identified and decision makers can take informed decisions


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Logical Framework Approach (LFA)Versus

Logical Framework Matrix (LFM)

LFALFA which is an analytical process involving stakeholders analysis, problem analysis, objective setting and strategy selection

LFM LFM is the product of the analysis and consists of a matrix of four columns and four (or more) rows summarising the key elements of a project


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Logical Framework MatrixProject

Description Indicators Sources of verification

Assumptions

Overall objective: the project’s contribution to policy or programme objectives (impact)

Purpose (often called specific objectives) – direct benefits to the target groups

Results (often called outputs) – tangible products or services delivered by the project

Activities (sometimes referred to Inputs) – which have to be undertaken to deliver the desired results

How the Overall Objective has to be measured including Quantity, Quality, and Time?

How the Purpose has to be measured including Quantity, Quality, and Time?

How the Results have to be measured including Quantity, Quality, and Time?

How will the information be collected, when and by whom?

Same as above

Same as above

What are general Assumptions? or major risks?

If the purpose is achieved, what assumptions must hold true to achieve the Overall Objective?

If results are achieved, what assumptions must hold true to achieve the Purpose?

If activities are completed, what assumptions must hold true to deliver the Results?


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LFA and Project Cycle

Identification: it is used to help analyse the existing situation, investigate the relevance of the project ideas proposed and identify potential objectives and strategies;Formulation: it is used to support the preparation of a good project plan with clear objectives, measurable results, risk management strategy and defined levels of management responsibility;Implementation: it is used to support daily work, contracting and monitoring;Evaluation: it is used to assess the project performance against what was planned.


111

LFA has two separate stages:

Analysis Stage: Stakeholders Analysis, Problem Analysis, Analysis of Objectives, Analysis of Strategies

Planning stage: Logframe matrix


112

4. Project Identification and Analysis

Stakeholders Analysis: identifies and characterises the main stakeholders and assesses their capacities;Problem Analysis: identifies the main problems, constraints and opportunities including the cause and effect relationship;Analysis of Objectives: develops solutions from the identified problems by picturing the image of an improved situation in the future;Analysis of Strategies: identifies different strategies to achieve the solutions selecting the most appropriate one.


113

Stakeholders Analysis

Who is a Stakeholder?Any individual or group of individuals who have a significant interest in the success or failure of a project;Often a stakeholder can also coincide with a beneficiary, a facilitator or an adversary;Different groups might have different concerns, interests and capacities and therefore it is very important that the first step is the identification of the different groups


114


There are a number of steps to undertake:identify the problem to address;identify all those who might have an interest in the potential project;investigate their roles, interests, power and capacity to participate;interpret the findings and incorporate them in the project design in order to make sure that (1) resources are correctly targeted; (2) stakeholders ownership and participation is promoted; (3) existing or potential conflicts of interests are addressed.


115


Tools to facilitate the stakeholders analysis

Stakeholder analysis matrixSWOT analysis


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Stakeholders Analysis Matrix

Stakeholders and basic characteristics

Interests and how affected by the problems

Capacity and motivation to bring about change

Possible action to address stakeholders interests

Stakeholder 1

Stakeholder 2

Stakeholder ….


117

SWOT Analysis

WEAKNESSES STRENGTHS

OPPORTUNITIES THREATS


118

Problem AnalysisSTEP 1: brainstorm on problems considered to be a priority by the stakeholdersSTEP 2: select individual starter problem STEP 3: identify related problems to the starter problem STEP 4: begin to establish a cause-effect relationshipSTEP 5: all other problems are sorted in the same way (cause-effect)STEP 6: problems are connected with cause-effect arrows showing the links STEP 7: revise the diagram to find out if some problems have not been identified STEP 8: the diagram is revised accordingly and distributed

A different, yet similar, method for Problem analysis is the “Fishbone diagramme”, or Ishikawa Root-cause analysis.


119

Ex. STEP 1: Brainstorm on problems considered to be a priority by the stakeholders

Lack of int. partnerships SMEs do not access int. markets

Lack of int. exposureLack of export promotion strategy

No access to advisory services

Lack of specific skills

Lack of funds


120

Ex. STEP 6: problems are connected with cause-effect arrows showing the links

SMEs do not access int. markets

Lack of int. partnerships

Lack of int. exposure

Lack of export promotion strategy

Lack of specific skills

Lack of funds No access to advisory services


121

Problem tree represention of Problem analysis


122

Fishbone Analysis (Root –Cause analysis or Ishikawa)

•

– No hay acceso a tecnologías modernas

– Bajo nivel tecnológico

– Baja competitividad 4 sectores


123

Analysis of objectives

1. describe the situation once the problems have

been removed;

2. verify the hierarchy of objectives;

3. illustrate the means-end relationship in a

diagram.


124


Starting from the problem tree, the negative situations are converted into solutions expressed in positive achievements.

The positive achievement are actually objectives which are presented into a diagram showing the hierarchy of means/end


125


SMEs are able to better access int. markets

SMEs build Int. partnerships

SMEs increase int. exposure

SME develop Export Prom. Strategies

SMEs acquire specific skills

SMEs benefit of ad hoc funds

SMEs access advisory services


126

Analysis of strategies/options

We have to concentrate on the potential merits or difficulties associated with addressing problems in different ways by considering a number of issues:


127


1. if all the problems have to be faced or only a selection of them;

2. positive opportunities on which we can build on (from SWOT);

3. combination of interventions which is likely to better achieve the results and ensure sustainability;

4. which option is best promoting local ownership;5. which is the most cost effective option;6. which option best impact on the needs of the

poor/most vulnerable groups


128


There are a number of general criteria for strategy selection and namely:

1.contribution to key policy objectives (poverty reduction, reduction of unemployment etc);

2.complimentary with other ongoing projects;3.environmental impact;4.etc…..


129

4. Project Planning

Most of the work done in the analysis stage is aimed to facilitate the planning stage and more specifically the finalisation of the Logical Framework Matrix (LFM).

The LFM is a summary of the project design.It is best between one and three-four pages in length. The first page ideally includes the Overall Objective, Purpose

and Results, while Activities can be described in the second, third or successive pages.


130



Assumptions

Overall objective: the project’s contribution to policy or programme objectives (impact)

Purpose (often called specific objectives) – direct benefits to the target groups

Results (often called outputs) – tangible products or services delivered by the project

Activities – tasks that have to be undertaken in order to deliver the desired results

How the Overall Objective has to be measured including Quantity, Quality, and Time?

How the Purpose has to be measured including Quantity, Quality, and Time?

How the Results have to be measured including Quantity, Quality, and Time?

How will the information be collected, when and by whom?

Same as above

Same as above

If the purpose is achieved, what assumptions must hold true to achieve the Overall Objective?

If results are achieved, what assumptions must hold true to achieve the Purpose?

If activities are completed, what assumptions must hold true to deliver the Results?


131

Sequence for completing LFMProject


Assumptions

Overall objective

(1)

Purpose

(2)

Results

Activities

Purpose

(2)

Result

(3)

Activities

(4)

(8)

(10)

(12)

(9)

(11)

(13) (6)

(5)

(7)


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First column: intervention logic

The first column of the Logframe matrix summarise the means-end logicmeans-end logic of the project also known as the intervention

logic


133

The objective hierarchy is read from the bottom up using an “IF, THEN” approach as follows:

IF adequate inputs/resources are provided, THEN activities will be undertaken

IF activities are undertaken, THEN results can be produced

IF results are produced, THEN the purpose can be achieved

IF the purpose is achieved, THEN this should contribute to the overall objective


134

The objective hierarchy is read from the bottom up using an “IF, THEN” approach as follows:

IF adequate inputs/resources are provided, THEN activities will be undertaken

IF activities are undertaken, THEN results can be produced

IF results are produced, THEN the purpose can be achieved

IF the purpose is achieved, THEN this should contribute to the overall objective


135

The LFM

The LFM helps to indicate the degree of control managers have over the different levels of the project’s objectivesManagers should have a significant control over inputs, activities and the delivery of resultsManagers can generally only exert influence over the achievement of the project purpose though the delivery of resultsManagers have no direct influence over the contribution the project makes to the overall objective.


136

If we apply the necessary and sufficient conditions to the first column of the Logframe matrix:

Achieving the purpose is necessary but not sufficient to attain the overall objective

Producing the project results is necessary but may be not sufficient to achieve the purpose

Carrying our project activities is necessary and sufficient to deliver the results

Inputs/resources should be necessary and sufficient to implement the planned activities


137

Wording

Project

Description Overall

objective

Purpose

Results

Activities

Statement

To contribute to…..Example: to contribute to the decrease of unemployment

Benefits to the target groups being improved etc…Example: improved legal environment

Tangible result delivered/produced/conducted…Example: improved training facilities available for

Present tense starting with an active verbExample: prepare and deliver public information….


138

Fourth column: assumptions

Assumptions are external factors having the potential to influence the success of a project but

are outside the direct control of the project management. They belong to the so called

vertical logic in the Logframe


139

Assumptions

once activities have been carried out IF the assumptions on the relevant level hold true THEN

results will be achieved;once results are achieved IF the assumptions of this

upper level hold true THEN the project purpose will be achieve;

once the purpose has been achieved IF the assumptions at this level hold true, THEN the project

will contribute to the achievement of the overall objective


140

Second and third columns: OVIs and sources of verification

Objective Verifiable Indicators (OVIs) and Sources of Verification are very important for both monitoring and evaluation and they respond to the so called horizontal logic


141

Objectively Verifiable Indicators

OVIs are indicators which help to measure and report on the achievement of objectivesOVIs describe the project’s objectives in operationally measurable terms (QQT= Quantity, Quality and Time)Focussing on OVIs during the planning phase helps to check on the feasibility of the project and constitute the basis for monitoring and evaluation


142

A good OVI has to be SMART:

S specific to the objective it is supposed to measureM measurable (either quantitatively or qualitatively)A available at an acceptable cost

R relevant to the information needs of managers

T time bound


143

Indicators

should be independent from each other namely related only one objective

are to be defined during the formulation stage and are specified in the implementation


144

Sources of verification

how the information is to be collected

who should collect it

when/how regularly to collect it


145

Activity schedule

is a format for analysing and graphically presenting project activitieshelps to identify their logical sequence, expected duration and any link existing between themprovides the basis for allocating management responsibility


146

STEP

STEP 1

STEP 2

STEP 3

STEP 4

STEP 2

STEP 3

STEP 4

STEP 5

STEP 6

STEP 7

STEP 8

DESCRIPTIONList Main activities:Starting from the Logframe we make a list of all the activities to be performed

Break activities into manageable tasks:The purpose is to make them simple to be organised and managed. Each task can be assigned to an individual. The breaking down process must stop as soon as the planner has sufficient detail

Clarify sequence (which activity comes first) and dependencies (is an activity dependent on the start-up/completion of any other activity?)

Estimate Start-up, duration and completion of activities:The planner makes a realistic estimate of the duration of each task in order to establish start-up and completion date.

Summarise Scheduling of main activities

Define Milestones:Identify key events that provide a measure of progress and a target for the project team to aim at.

Define expertise:Once the tasks are specified we can identify the type of expertise required

Allocate tasks among team:This is not only a definition of who does what. It involves the responsibility for the achievement of the milestones.


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ID Nome attività

26 C1. Institution Building for RDP

27 Establish a Strategy Committee in each region

28 Identify and meet with members of the SC

29 Develop modalities & mechanism for the operation of the SC

30 Submit SC membership to EC Delegation and Project Partners

31 Establish Working Groups in each region

32 Define thematic Working Groups

33 Identify members of the Working Groups

34 Develop mechanism and modalities for the operation of the WGs

35 Submit WG membership to EC Delegation and Project Beneficiaries

36 Training on RDP for both SC and WG members

37 Design and agree training programme on RDP

38 Select participants

39 Organise & deliver training workshops in RDP

40 Evaluate the performance & supplementary trainings as needed

41 Assist regional officials with drafting RD strategies

42 Assist to carry out Regional Socio-Economic Analyses

43 Assist to set priorities & draft RD strategies

44 Assist to formulate action plans for implementation of RD strategies

45 Facilitate acceptance of RDPs by the Central Governement

46 Develop & implement Marketing Strategy to implement RDP

RDA

RDA

04/05

RDA

RDA

MGL ASONDGFMAMGL ASONDGFMAMGL ASONDGFMAMGL ASONDGFMAMGL ASONDGFMAMGL ASONDGFMAMGL ASO2003 2004 2005 2006 2007 2008 2009

STEP 1:List m ain activities

from Logfram e

STEP 2:Break activities

Into tasks

STEP 3:Clarify sequence &

dependence

STEP 4:Estim ate start-up,

D uration &com pletion

STEP 5:Sum m arise

Scheduling ofm ain activities

STEP 6:D efine m ilestones

STEP 7,8:D efine expertise

required & allocatetasks

STEP 3:Clarify sequence &

dependence

STEP 4:Estim ate start-up,

D uration &com pletion

STEP 5:Sum m arise

Scheduling ofm ain activities

STEP 6:D efine m ilestones

STEP 7,8:D efine expertise

required & allocatetasks

Activity Schedule


148

An Activity Schedule for a small project can be simpleEgypt Textile & Ready-Made Garments' SMG proposal

Text No.Task Responsib. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Stage ( A) Preparation: Markets Penetration and Product / Market Match

2.1 Introduction RR

2.2 Buyers identification and qualification RR/JP/AG/AS

2.3Initial Approach to buyers and consolidation of contacts

RR/JP/AG/AS

2.4 Completion of Sampling and Matchmaking RR/JP/AG/AS

Stage (B): Inward Buying Mission from THE EUROPEAN UNION and Egyptian companies visits to THE EUROPEAN UNIONStage (B-1): Implementation: Inward Buying Mission (IBM)

2.5Preparation of factories, buyers itineraries and completion of buyers visits

RR/JP/AG/AS

2.6 Follow-up activities RR/JP/AG/AS Stage (B)-2 : Implementation: In Country Marketing Support ( ICMS)

2.7Preparation of Individual SMG members programs

RR/JP/AG/AS

2.8 SMG members Visits Follow- up RR/JP/AG/AS

Total ManDays

Weeks after start-up ( TOTAL 5 MONTHS)


149

Time Estimation/Schedule for experts should be included

Months Name Position 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 18 20 21 22 23 24 Number of

months Geoffry Cobb Team Leader 21 K Kappe LT

International Expert

18

Javier Fargas

LT International Expert

18

Total Man Months 57 Months Name Position 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Estimated

Number of days Pool of ST Experts

Turnaround 175

Pool of ST Experts

Finance 150

Pool of ST Experts

Marketing 75

Pool of ST Experts

Reg. Dev. / Policy

100

Pool of ST Experts

Institutional Strengthening/ Training

120

Pool of ST Experts

Trade Policy 30

Pool of ST Experts

Quality 50

Pool of ST Experts

Industry Specialist

200

Pool of ST Experts

Bosnian Consultants

350

International Local

Total Man Days

900 350 1250


150

Resource and cost schedule

the list of activities should be copied into a Resource Schedule whereby each activity should be used as a checklist to ensure that all the necessary resource/inputs required are provided for

for each activity a list of needed resources/input needs to be developed together with a cost estimation


151

Resource and cost schedule

ACTIVITIES / INPUTS Unit Quantity per planning periodCost per unit

Funding source Cost codes Cost per planning period

Project Total

Annual recurrent costs

1st Q 2nd Q 3rd Q 4th Q Donor Govt 1st Q 2nd Q 3rd Q 4th QC1.2 Establish WGs in each region

Equipmentcomputers no. 2 2 1000 2000 2000 4000fax, modem no. 1 500 500 500furniture lump 1 3000 3000 3000

Salaries & allowancesoffice staff mm 4 4 4 4 200 800 800 800 800 3200 3200counterparts mm 2 3 3 3 100 200 300 300 300 1100 1100

ETC

STEP 1:Copy activities

from Activity Schedule

STEP 2:Specify INPUTS STEP 3:

Put inputs into costcategories

STEP 4:Specify units

STEP 5:Specify quantity

STEP 6:Estimate unit cost

STEP 7:Identify funding

source

STEP 8:Allocate cost codes

STEP 9:Schedule costs

STEP 10:Calculate total

STEP 11:Estimate recurrent

costs


152

Project Fiches and Terms of Reference

• Project Fiches is the name given to Documents at the end of the Formulation Stage (but can also be called after the Identification stage, albeit in a more preliminary form.

• Terms of Reference are the detailed descriptions of work at any stage of the Project Cycle, generally to contract:

• Pre-feasibility analysis

• Feasibility and design studies

• Appraisal or quality support missions

• Implementation of large and small contract

• Evaluations

• Technical or advisory support

• Audit


153

Contents of Project Fiches

• Project Fiches must reflect the outputs and elements of Information required at the end of the Formulation Phase. Although the various EC programmes have differing formats for Project fiches- they are not as standardised as Terms of Reference- generally they will include:

• - Background to the Project- Justification /Situation Analysis• Overall objective and purpose• Target group, location and duration• Results and indicative activities• Resources and Expertise required• Management Arrangements• Risks• Impacts and Indicators• Sustanability • Environmental, social, gender and other issues• Budget Appendices with studies, research, descriptions, etc.


154

Contents of Terms of Reference

• Although it will change depending of the Scope of the project, the general format will include:

1. Background to the Assignment

2. Study /mission objectives

3. Issues to be studied

4. Methodology for the study or implementation

5. Expertise required

6. Reporting requirements

7. Workplan and timetable

Appendices with background information or detailed budget.


155

6. Implementation, Monitoring and Evaluation Implementation

• Regarding Implementation of projects once tendered and contracted, the EC does not suggest any specific project management methodology, beyond the Logframe Matrix and Monitoring and Evaluation guidelines.

• Reason given by directors is that various standards and methodologies are in the market for the pure “management of the project” (PMI, IPMA, Prince 2, private companies, etc.- they will be described briefly in Section 7), and therefore the EC cannot impose one over the others.

• As long as both the operational and financial aspects of the Indicators, Means of Verification, Activities, Resources and Risks are properly followed and filed, any method can be used by project implementors and contractors.


156

Monitoring

Monitoring of projects is described by the EC PCM. It is aimed to support:

identification of successes and problems during the project implementation;informed and timely decision-making;accountability for the resources used and results achieved;stakeholders awareness and participation;evaluation and audit.

Monitoring involves the collection, analysis, communication and use of information about the

project’s progress


157

Monitoring system

A good monitoring system should provide relevant information to the right people at the right time to help them take informed decisions.

Monitoring should highlight strengths and weaknesses in the project implementation and enable the responsible people to deal with problems, improve performance, build on success and adapt to changing circumstances


158

What to monitor

1. which activities are underway and what progress has been made? (efficiency)

2. at what rate are means being used and cost incurred in relation to progress implementation (efficiency)

3. are the desired results being achieved? (efficiency)

4. to what extent are these results furthering the Project purpose? (effectiveness)

5. what changes in the project environment occur? (impact)

6. Do assumptions hold true?


159

Who needs what information

The identification of what information to collect is determined by analysing the following:

project objectives, stakeholders interest and capacity; institutional and management structures; decision making responsibilities


160

There are six main stages for developing a monitoring system

1. clarify project scope;2. understand the nature of organisational

relationships, management arrangements and capacity constraints;

3. determine the information needs of project implementers and key stakeholders;

4. review existing information collection systems and procedures;

5. develop and document monitoring system guidelines and formats;

6. provide training and resources to support systems development and implementation


161

LFA and monitoring

Analysis of existing situation: a stakeholders analysis including the information

needs; strengths and weakness of existing monitoring

system if any.Activity schedules: structure for preparing operational work plans

against which implementation can be periodically assessed (key tasks, timing, duration, responsibilities);

visual presentation of key tasks that can be used to promote participatory planning


162

LFA and monitoring

Logframe matrix: a diagram of objectives, indicators and sources of

information to be used in developing and implementing a monitoring system;

a list of key assumptions.

Resource and budget schedules: format for preparing operational budgets linked to

planned activities and results reference point for resource and financial

monitoring (planned/actual) framework for identifying the resources and costs

required to implement the monitoring


163

LFA and monitoring

Risk matrix:

The achievement of project objectives is always subject to influences beyond project manager’s direct control (assumptions and risks). It is very important to monitor this external environment to identify whether or not the assumptions that have already been made are likely to hold true and what new risk may be emerging and which actions have to be taken to mitigate the risk if possible


164

Risk matrix

The achievement of project objectives is always subject to influences beyond project manager’s direct control (assumptions and risks). It is very important to monitor this external environment to identify whether or not the assumptions that have already been made are likely to hold true and what new risk may be emerging and which actions have to be taken to mitigate the risk if possible


165

Risk matrix

LF ref

Risk Potential adverse impact

Risk level (H/M/L)

Risk management strategy

Responsibility

Beneficiary staff is not motivated to participate in a comprehensive capacity building programme

Lack of consultants ready to start serving in the

A real danger of capacity building being sub optimal; activities might collapse once the TA is over

The voucher counselling system cannot be

M

H

•Propose staff incentive plans•Discuss with project partners •Recommend to replace certain staff

More training for Local Service and Training

BeneficiaryProject managementDonor

Project managementDonor

1

1.1


166

Interviews

Monitoring often includes making short visits to a project site. It is very important to a checklist of things to consider as well as a list of specific questions to ask.Questions need to be targeted on the project.


167

How to analyse the information/data

• Analysing data and effectively turning data into useful management information is different from merely collecting it.

• The key issue in the monitoring activity is how to analyse and present the data collected. We should bear in mind that quantitative data involve numbers that can be subject to various forms of statistical analysis while qualitative data usually provide information on people’s views, opinion or observations and are presented in a narrative way.


168

Balancing quantity and quality

• An appropriate balance of the two with an interpretation of the quantitative data being enriched by the qualitative analysis (what people think).

• In any analysis, objective opinions, surveys and interviews are required for


169


Planned vs Actual

Monitoring is primarily about comparing what was originally planned with what actually happened (including costs and resources). This analysis is the basis of any monitoring systems. If we learn from our records that something is not happening as planned, we should also analyse the causes of the problem and determine an appropriate remedial action


170


Percentage/ratios

Calculating percentages and ratios is a very useful way to present the performance of the project. Such ratios helps us to see how close we are to achieving what we originally planned. Low percentages figures immediately highlight a potential area of concern unless we have a valid explanation for this.


171


Trends over time and comparison between time periods

An analysis of data over different time periods can help to see how the project is performing. However, this is useful only if we have a clear and consistent set of indicators (measuring the same thing in the same way at different points in time).


172


Geographic variance

Projects that are implemented in different locations can be monitored in a way that they help identify geographic variations while aggregate data would not allow this


173


Group variance

It might be useful to observe variance in outcomes between different social groups (impact on men and women). This implies that data need to be processed and classified keeping in mind that they need to be disaggregated


174

Focus of the analysis

Questions to answer

Information needed

Planned vs actual(efficiency)

Risk & Assumptions

Design(relevance)

Project results(effectiveness)

Sustainability

Impact

Is the project doing what was originally planned?

Activity scheduleResource scheduleLogframe matrixProject ReportsInterviews

Are the assumptions holding true? Are new risks emerging?

Risk matrixLogframe matrix

Was the project design relevant? Is it still relevant?

Logframe matrixStakeholders Analysis (etc LFA)

What difference is the project making?

Logframe matrix, Project ReportsInterviews

Are the project purposes likely to be sustainable?

Will the project impact on the overall objective?

Logframe matrix


175

Evaluation

Ex ante

is the feasibility study of the project and it sets out the aims of it. Usually it is revised during the project implementation in the light of the finding of the Monitoring exercise


176

Evaluation

Mid-term/interim

is conducted approximately halfway during the project implementation. The mid-term/interim evaluation will use the information contained in the Programme and Project monitoring reports but will not be based exclusively upon them exercise


177

Mid-term/interim evaluation

A project can achieve its immediate objectives but not have the impact that had been anticipated. The mid-term/interim evaluation should therefore address the following:

have the right objectives been set for the Programme/projectare the key problems being addressed/the key target groups being reached?have the right Projects/Programmes been identified to achieve the wider objectives of the Programme/Policy?…………………


178

Mid-term/interim evaluation

………………. are the Programmes/Projects being implemented

efficiently and effectively? are they having the desired and anticipated effects

(achieving the desired results, objectives and impact)? are the management and implementation

arrangements for the project effective?


179

Evaluation

Ex post

is usually carried out one or two years after the period of the strategy has elapsed. Although the ex post evaluation will analyse the relevancy, efficiency and effectiveness of the Project/Programme, the primary focus will be upon impact and sustainability


180

The information need varies depending on what we are analysing and therefore it is useful to see which information is to be collected for each evaluation criterion

What information/data we need


181


Questions to answer

Information needed

Relevance

Efficiency

Effectiveness

Impact

Sustainability

Is the project design relevant? Logframe matrixStakeholders Analysis, Problem Analysis, Analysis of Objectives, Analysis of Strategies (if available)Monitoring Reports

How well the various activities transformed the available resources into the intended results?

Logframe matrix

How far the project’s results were used or their potential benefits were realised?

Logframe matrix

To what extent the benefits received by the target beneficiaries have had a wider overall effect?

Logframe matrixInterviews

Are the positive outcomes of the project at purpose level likely to continue after the external funding?

Interviews


182

The type of analysis we need to carry out depends on which questions we are answering and varies from project to project. However, a general overview can be given analysing more carefully the evaluation criteria and the type of question they are aimed to answer



183

The relevance of a project relates primarily to its design and concerns the extent to which its stated objectives correctly address the identified problems or real needs.

It needs to be kept under review throughout the life of the project in case changes occur either in the nature of the very problems originally identified, or in the circumstances - whether physical, political, economic, social, environmental, institutional or policy - in which the project takes place, necessitating a corresponding change of focus

Relevance


184

Relevance concerns the appropriateness of the project design to the problems to be resolved at two points in time:

1.when the projects was designed

2.at the time of the evaluation

Relevance


185

identification of real (vs perceived) problems or needs, and of the correct beneficiaries, and how well the project’s initial design addressed them;

quality of assessment of local absorption capacities; quality of assessment of local implementation

capacities; where possible, preparatory activities undertaken

(policy assessments, sector reviews, pre-feasibility studies including financial and economic analysis, planning workshops, etc), by whom, how well the findings were incorporated into the final project document, and any obvious omissions;

…….

Relevance focuses on:


186

appropriateness of initial consultations with, and participation by, local key stakeholders, national authorities, intended beneficiaries, and other donors (the last-mentioned especially on complementarity aspects) before the design was confirmed and implementation started;

complementarity and coherence with related activities undertaken elsewhere by government or other donors, at the same level or at a higher level, rather than duplication or conflict;

the quality of the entries in assumptions, risks and conditions column of the LogFrame at the appropriate levels;



187

overall design strengths and weaknesses including:

quality of the Logframe (or LogFrames if a multi-component programme);

clarity and internal consistency of the stated overall objectives, purpose, and results; whether the objectively-verifiable indicators of achievement (OVIs) were well-chosen and widely agreed;

realism in choice and quantity of inputs; overall degree of flexibility and adaptability to

facilitate rapid responses to changes in circumstances.



188

The efficiency criterion concerns how well the various activities transformed the available resources into the intended results (sometimes referred to as outputs), in terms of quantity, quality and timeliness.

A key question it asks is “where things done right” and thereby also addresses value-for-money, that is whether similar results could have been achieved more by other means at lower cost in the same time.

Efficiency


189

The quality of day-to-day management, for example in:

management of the budget (including whether an inadequate budget was a factor);

management of personnel, information, property, etc.;

whether management of risk was adequate, i.e. whether flexibility was demonstrated;

in response to changes in circumstances; relations/co-ordination with local authorities,

institutions, beneficiaries, other donors; respect for deadlines;

Efficiency focuses on:


190

Cost and value for money:

how far the costs of the project were justified by the benefits - whether or not expressed in monetary terms - that they generated, in comparison with similar projects or known alternative approaches, taking account of contextual differences



191

Contributions from local institutions and government (e.g offices, experts, reports,. tax exemption, as set out in the LogFrame resource schedule), target beneficiaries and other local parties:

were they provided as planned, could re-allocation of responsibilities have improved performance, were communications good?



192

The effectiveness criterion, in LogFrame terminology, concerns how far the project’s results were used or their potential benefits were realised - in other words, whether they achieved the project purpose.

The key question is what difference the project made in practice, as measured by how far the intended beneficiaries really benefited from the products or services it made available.

Effectiveness


193

whether the planned benefits have been delivered and received, as perceived mainly by the key beneficiaries, but also taking account of the views of donor management, the responsible national Government authorities, and other concerned parties (NGOs, business associations etc)

Effectiveness focuses on:


194

the appropriateness of the indicators of benefit used in the above assessment to measure achievement of the project purpose (this is also relevant to cost-effectiveness analysis as referred to in the footnote on the previous page);

this should include a judgement on how promptly and effectively the project management reacted to any changes that occurred following the initial design by amending indicators found no longer to be appropriate



195

If the assumption and risks assessments at results level turned out to be inadequate or invalid, or unforeseen external factors intervened, how flexible management adapted to ensure that the results would still achieve the purpose;

- how well it was supported in this by key stakeholders including Government, Commission (HQ and locally), etc.: in summary, “were the right things done” to ensure that the potential beneficiaries actually benefited? - how unplanned results may have affected the benefits received



196

The term impact, sometimes referred to as outcome, denotes the relationship between the project’s purpose and overall objectives, that is the extent to which the benefits received by the target beneficiaries had a wider overall effect on larger numbers of people in the sector or region or in the country as a whole. The analysis, which should be both quantitative and qualitative wherever possible, will need to take account of the fact that, at this level, the project will normally be only one of a number of influences contributing to the wider outcome

Impact


197

to what extent the planned overall objectives have been achieved, and how far that was directly due to the project;

if there were unplanned impacts, how they affected the overall impact;

whether the project’s LogFrame indicators at this level were suitable and, if not, whether management amended them;

whether overall the desired wider impact could have been better achieved otherwise.

Impact focuses on:


198

The fifth and final - and often most important -criterion, sustainability, relates to whether the positive outcomes of the project at purpose level are likely to continue after the external funding, and also whether its longer-term impact on the wider development process can also be sustained at the level of the sector, region or country

Sustainability


199

The first step for a correct monitoring and evaluation exercise is to start from the policy framework to see how and why the project/programmes have been conceived. The SME strategy read:

“The Programme to support the access of SMEs to training and consultancy services covers the period 2002-2005 and directly responds to the Governmental Draft Strategy for Sustaining the Development of SMEs 2004-2008 updated in 2003, as well as to the Governmental Programme 2001-2004.”

Clarifying project scope


200

Ownership of objectives and achievements, e.g. how far all stakeholders were consulted on the objectives from the outset, and whether they agreed with them and remained in agreement throughout the duration of the project;

Policy support and the responsibility of the beneficiary institutions e.g. how far donor policy and national policy corresponded, and the effects of any policy changes; how far the relevant national, sectoral and budgetary policies and priorities affected the project positively or adversely; the level of support from governmental, public, business and civil society organisations; and whether national bodies to provided resources;

Sustainability focuses on:


201

Institutional capacity, e.g. the degree of commitment of all parties involved, such as Government (e.g. through policy and budgetary support) and counterpart institutions; the extent to which the project is embedded in local institutional structures; if it involved creating a new institution, how far good relations with existing institutions were established; whether the institution appears likely to be capable of continuing the flow of benefits after the project ends (is it well-led, with adequate and trained staff, sufficient budget and equipment?); whether counterparts were properly prepared for taking over, technically, financially and managerially



202

Adequacy of the project budget for its purpose and intended results;

The socio-cultural factors, e.g. whether the project is in tune with local perceptions of needs and of ways of producing and sharing benefits; whether it respects local power-structures, status systems and beliefs, and if it seeks to change any of those, how well-accepted are the changes both by the target group and by others; i.e. how well it was based on the analysis of such factors, including target group/ beneficiary participation in design and implementation, the quality of relations between the external project staff and local communities.



203

Financial sustainability, e.g. whether the products or services provided were affordable for the intended beneficiaries and remained so after funding ended; whether enough funds were available to cover all costs (including recurrent costs, i.e. operating and maintenance costs), and continue to do so after funding ended; and economic sustainability, i.e. how well the benefits (returns) compared to those on similar undertakings once market distortions are eliminated.

And finally, on the replicability of such action and results in other regions, areas, countries or target groups.



204

EC evaluators usually include in their assessments an overall performance rating for each of the above five evaluation criteria, on the basis of the following scale:highly satisfactory (fully according to plan or better);satisfactory (on balance according to plan, positive aspects outweighing negative aspects);less than satisfactory (not sufficiently according to plan, taking account of the evolving context; a few positive aspects, but outweighed by negative aspects);highly unsatisfactory (seriously deficient, very few or no positive aspects)

Performance ratings


205

Project Monitoring & Evaluation:

A pilot case

Programme to support the access of

SMEs to training and consultancy

services in Romania


206

The Programme is a multi annual grant scheme - Develop the capacity of SMEs:

Measure 1 - Business infrastructure necessary to improve the competitiveness of SMEs

a) Support innovative SME and technology transfer among SMEs

b) Support consulting networkc) Support the access of SMEs to training and

consultancy services d) Support access to business information

Clarifying project scope


207

1. facilitate the access of SMEs staff with managing and executive responsibilities to training initiatives on management (including quality and financial management), marketing, strategy and planning, investment sources and financing methods, EU legislation and practices in the SME sector and in other sectors which are priorities for the SME activity;

2. facilitate the access to consulting services for the development of business plans and marketing plans, the access to finance, certification of standardisation systems, quality certification according to EU norms

The project purpose (specific objectives)


208

The Agenţia Naţională pentru Întreprinderi Mici şi Mijlocii şi Cooperaţie (ANIMMC, or National Agency for SMEs and Cooperatives) is the responsible body for the implementation of the annual programme

Further to a decision of the President of the ANIMMC approving the implementation procedures, applicants for consulting and training can submit their requests for co-financing until the end of the year 2004.

Organisational relationships, management arrangements and

capacity constraints


209

“The Agency will finalise the evaluation process within 30 days from the receipt of the complete application.”

“The selection principle is “first come, first served”, once the application is fully compliant with all administrative requirements and eligible under the criteria stated in the implementation procedures.”




210

Eligibility is related to:

legal status of the applicant and relevant documentary evidence (of the implementation procedures)

type of service for which financing is requested




211

Once the evaluation has been carried out, the Agency sends a Notification of Financing to the successful applications and notifies to the unsuccessful ones the reason of their exclusion, which can be as follows:

application received after the deadline; application received after the maximum budget

available has been allocated; application is not eligible.




212

“The applicant has to send to the Agency a Formal Request of financing, together with the original Notification for Financing and a number of Supporting documents as well as a list of costs of the consulting or training, according to the instructions provided in Annex I of the implementation procedures.




213

Financing mechanism

ANIMMCANIMMC

APPLICANTSAPPLICANTS

1Approval of

Implementationprocedures

2Application

Form

3Notification of

Financing

4Request forfinancing


214

“The main constraints in monitoring and evaluating this programme is that the programming phase has focused exclusively on the disbursement of the funds, rather than planning monitoring and evaluation.”

“The consequence is that all the documents produced by the Agency, as well as those requested to the applicant are aimed to facilitate the selection for financing and a proper disbursement and not the analysis of what the project has achieved and how has achieved it.”

Capacity constraints


215

“The first step in devising a monitoring and evaluation system for a programme under formulation is to define a Logframe Matrix for the programme.”

“The criteria for future Evaluation must be understood and analysed so as to design a Monitoring and Evaluation system.”

Developing guidelines and formats


216



Assumptions

Overall objective:

to contribute to the development of SME competitiveness

Purposes:• to develop

entrepreneurship skills for facing market globalisation and EU integration;

• to increase the number of successful entrepreneurs

Results:Improved access to relevant

training coursesCompanies get contribution

for financing business and marketing plans

Activities:•Approve the grant for training is approved•Approve the grant for consulting services

Increase in average turnoverIncrease in exportsIncrease in no. of employeesIncreased in labour productivityIncrease in innovation exp.Decrease of mortality rate

Skills are improvedStaff undertakes initiatives/operational improvementsCompanies improve their competitivenessCompanies implement the financed plans

Increase no. of training hours per employee

Increased number of business and marketing plans

National official statistics and SME surveys carried out by NAIMMC

Skills audit reportsProject reportsInterview after 5 year from the completion of the activities financed by the grant

Project reportsMIS

•The government policy towards SMEs remains unchanged or is improved•There are no major international constraints to the development of Romanian SMEs

•People taking part in the training activities are properly selected and motivated•Business and marketing plans are implemented by the companies

•Applications for grants are received•There are a number of enterprise willing to undertake business and marketing development plans


217

Evaluation criteria


Question to answer

Information needed

Relevance Is the project design relevant? Does the project correctly address the identified problems/real needs?

•Planning documents•Logframe•SMEs surveys•Interviews with assisted companies


218

Evaluation criteria


Question to answer

Information needed

Efficiency

How well the grants have actually improved the access to training courses and enabled the companies to finance marketing and business plans?

•Data on training hours per employee before the project (reports/MIS)•Data on business and marketing plans before the project (reports/MIS)


219

Evaluation criteria


Question to answer

Information needed

Effectiveness

How far the improved access to training and the financing of marketing and business plans have led to an increased competitiveness?

•Comparison between the skills audit (before and after)•Have operational improvements been undertaken in the areas covered by the training? (reports)•Increase in turn over (report/MIS)•Increase in no. of employees (report/MIS)•Has the company implemented the plan? (report)


220

Evaluation criteria


Question to answer

Information needed

Impact

To what extent have the benefits received by the target companies had an impact at the national level on SME competitiveness?

•Indicators on company competitiveness (national statistics and SME surveys)


221

Logframe and evaluation criteria


Question to answer

Information needed

Sustainability

Are the positive outcomes of the programme likely to continue after the two years of financing?Will the companies make use of the skills improvements and will they implement and follow up the marketing and business plans?

•In which way the training courses are being capitalised? Any operational change/initiative is being discussed in the areas covered by training? •Are the beneficiaries willing to implement the business/marketing plans?•(Interview with companies)


222

In the above table we have listed the type of information that we need in order to answer the questions related to the evaluation criteria.

Furthermore we will also require the following tools for the Monitoring system:

Management Information System; Skills audit; Progress reports; Sample interviews with companies.

Information needed


223

Management Information System


224

• A Database is the best instrument to gather all the information on the beneficiary companies that will allow monitoring and evaluation.

• Once the fields have been identified, we have to establish how information can be obtained and when.

• For instance the data needed for the above database can be obtained from:

Application form Progress reports Final report Annual reports (for 5 years)

Management Information System


225

Skills AuditName of the trainee 1 2 3 4 5

Mr X

Position in the company

Marketing Director

Title of training course

Skill audit:

Communications skills

Market analysis

Knowledge of the market

Knowledge of bench. tech.

Dev. Marketing campaign

Dev. Mkt campaign results

Eval. Marketing planning

Identify comm. tools

……………………..


226

Reports in a programme like the one described will mainly aim to collect the data we have identified as necessary to conduct monitoring and evaluation and namely:

update on turn over, number of employees, exports, labour productivity, innovation expenses, training hours;

information on business/marketing plans drafted/implemented;

information on any initiative/operational improvements in the areas covered by training

Reports


227

Interviews with companies

• Interviews with companies are very important for monitoring and even more important for evaluation as they are useful to assess all the quality part of the information which cannot be assessed.

• Interviews have to be targeted sub-project (for an individual SMEs) by sub-project. For sub-projects belonging to the same area, a common list of questions could be developed.


228

Global and Annual Operating Plans

• The EC has a standard format for drafting Global Operating Plans and Annual Operating Plans (POG and POA in Spanish). Download at EuropeAid website.

• Global Operating Plans are a sort of long Inception report, with Stakeholder analysis, Problem analysis (through workshops and interviews), Strategies/options, Activities, Resources, Budgets, CashFlows and other appendices (usually financed with the first short term missions).

• Annual Operating Plans are the yearly activities since contract signature, with the first twelve months of activities, budgets, expert missions, etc. The second, third and other years (if relevant) have to follow the same format.


229

Economic and Financial Analysis

• Financial Analysis; all classical techniques of cash-flow, profitability, return, discounting, etc., apply. The issue is to WHOM and in which manner, but various hypotheses (scenarios) can be made.

• Economic Analysis: - The Effects Method: tries to quantify the effects on the local, regional,

national or supra-national economy, summing the Direct effects (goal), the Indirect effects and the Secondary effects (unintended frequently). The backward linkages of our project entities with other entities should be considered.

- Shadow Prices method: Shadows prices can be estimated that reflect the acceptable prices for the identified society. These prices can be real prices adjusted because of market distortions, or simply, international prices or the opportunity cost (as a proxy). Eliminations of transfers (subsidies, taxes, etc.) should be made to avoid distortions. NPV and IRR can be calculated.


230

FINANCIAL AND ECONOMIC ANALYSIS • Economic and Financial Analysis (EcoFin Analysis) is one of the relevant

forms of analysis of a project among others (institutional, environmental, political, social, gender, etc.). It is not compulsory as is the LogFrame matrix and usedby EuropeAid mostly in developing regions, not so much transition or mid-level countries or regions.

• Financial Analysis focuses on the point of view of one entity or group of

institutions (beneficiary, target group, etc.). This is done through Cost-

benefit analysis or Cost-effectiveness analysis.

• Economic Analysis on the point of view of society at large... or at least the wider environment of the project. This is done through the Effects Method or the Shadow-pricing method.

• The philosophy of Eco-Fin analysis is to measure the incremental value of the “with-project” situation and the “without-project” situation.


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Economic and Financial Analysis: • EcoFin Analysis places first the Analysis in relation to the LogFrame

Matrix, its stakeholders, results intended, indicators, risks, etc.

• Second it analysis the main Entities involved and affected by the project (artisans, farmers, SMEs, consumers, government agencies, development agencies, etc.). Then, the flows (of money, materials, services, etc.) is charted and quantified:

Villagers Cooperatives

Rural Bank

Sales of goods

Savings

Microcredits

Deposits Interest

Small loans


232

Economic and Financial Analysis

• Cost-Benefit Analysis: - Values benefits by direct calculation of benefits (increase of production

with real prices or reduction of costs) or by “proxies”, i.e. representative factors which are acknowledged to be a reliable estimate (e.g. reduction in Vehicle maintenance for a road improvement project).

- Includes cost recovery , i.e. Payment by users or contributions,- Allows for “profitability” (highest cost-benefit proportion) criteria for

selection of projects. Can also calculate usual profitability ratios of pay-back period, Net Present Value (NPV) and Internal Rate of Return (IRR).

- Cost-Effectiveness Analysis:- Analysis intangibles (not possible to estimate monetary value)- Compares cost per unit of options (e.g. vaccination per child)- Is usually only applicable to a sector, as inter-sector (social or industrial

are usually not applicable).


233

Conclusions

• Project Cycle management looks simple (one matrix,

qualitative issues in stakeholder, problem and objectives analyses, frequently obvious objectives, results and indicators), but it is NOT easy to come up with realistic Indicators, Means of verification which satisfy the effectiveness-efficiency-impact measurement, a good Risk-assumptions analysis, and a concise, yet complete, summarised Activities and Resources chart.

• Writing Terms of reference (or Project fiches) consists of being concise- not wordy- informative, complete (in requirements of the work and analysis), and having experience as to how projects and situations really work (for realistic estimates and outcomes). When budgeting the project, a bottom up and a top-down estimation of prices is useful, unless freedom is left to tenderers, so as to see if they come up with new or innovative manners of solving the requirements which hasn’t been foreseen.


234

Conclusions

• Economic and Financial Analysis requires some imagination in the parameters, some knowledge of the underlying economics of the sector or products/services, and a bit of understanding of the desired level of certainty of the “economic” estimates which the main reader (s) of the analysis will accept (frequently a function of their educational background and their role at the beneficiary, implementing agency, EC Delegation or Brussels office, etc.

• Nothing beats experience - in improving one’s skills of PCM , EcoFin or drafting ToRs – as undertaking all the tasks required for a project from its idea to final evaluation and sustainability.

• PRACTICE DOES MAKE PERFECTION IN THIS AREA. THANKS

CRZM GJ Proiect RO 2002/000- 586.05.02.02 - 162 1 European Structural Funds and its Programme,...

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Transcript of CRZM GJ Proiect RO 2002/000- 586.05.02.02 - 162 1 European Structural Funds and its Programme,...