1. 30 th meeting of the Expert Group on DA and IA for the ESI Funds Fiche No 37 based on Fiche No 21 Article 14(1) ESF Reg. Brussels, 18 May 2015

2. Structure of the intervention 1. Overview of Article 14(1) ESF mechanism 2. The empowerment and the delegated act (DA) 3. The Swedish experience

3. Part 1: Overview of Article 14(1) ESF mechanism

4. Article 14(1) ESF Regulation Is relevant for all types of ESF operations (no minimum/maximum value). But: No cross-financing is allowed The COM will only consider assessing data set when the scheme is expected to cover more than EUR 1 million over the programming period.

5. Two main options for the coverage of costs with 14(1) ESF: All the eligible costs of the operation are covered and declared on the basis of Article 14(1) ESF (example 1) Part of the eligible costs are covered by Article 14(1) ESF (example 2)

6. Example 1 — an operation where all eligible costs are covered by Article 14(1) of the ESF Regulation Commission  Managing Authority Delegated act: EUR 700 / student who completes a training The expenditure included in a payment application sent to the Commission will be based on the justified indicator included in the DA. Managing Authority  Beneficiary The Managing Authority has four options for reimbursing the beneficiary: Option 1: the standard scale of unit costs (Article 14(1) of the ESF Regulation) is applied to the beneficiary Option 2: real costs are applied to the beneficiary Option 3: another SCO system is applied to the beneficiary Option 4: a combination of real costs and SCOs is applied to the beneficiary

7. Example 1 — an operation where all eligible costs are covered by Article 14(1) of the ESF Regulation Total eligible expenditure = standard scale of unit costs under Article 14(1) ESF Commission  Managing Authority Delegated act: EUR 700 / student who completes the training EUR 700 x 50 students who complete the training = EUR 35 000 Managing Authority  Beneficiary Option 1: Article 14(1) is applied to the beneficiary Option 2: real costs are applied to the beneficiary Option 3: another SCO system is applied EUR 700 x 50 students who complete the training = EUR 35 000 Invoices/salary slips etc. = EUR 36 000 Lump sum of EUR 35 500 if at least 45 students complete the training = EUR 35 500

8. Example 2– Basis for reimbursement linked to an operation where eligible costs are partly covered by a standard scale of unit costs under Article 14(1) of the ESF Regulation Commission  Managing Authority The payment application sent to the Commission includes: the operation’s direct staff costs, based on the justified indicator (delegated act: EUR 20/hour); the operation’s other direct costs, declared based on real costs; the indirect costs, declared based on a flat rate. Managing Authority  Beneficiary The Managing Authority should apply the same methodology: the operation’s direct staff costs should be based on the justified indicator (delegated act: EUR 20 / hour); the operation’s other direct costs should be declared based on real costs; the indirect costs should be declared based on a flat rate.

9. Example 2– Basis for reimbursement linked to an operation where eligible costs are partly covered by a standard scale of unit costs under Article 14(1) of the ESF Regulation Methodology used to cover the different categories of costs in one operation Standard scale of unit costs under Article 14(1) of the ESF Regulation Real costs Article 67(1) (a) CPR Flat rate financing Article 68(1) (b) CPR Expenditure of one operation = Delegated act: direct staff costs = EUR 10/hour Direct costs other than staff costs Indirect costs 15 % x direct staff costs Commission  Managing Authority EUR 10 x 120 hours = EUR 1.200 EUR 800 15 % x EUR 1.200 = EUR 180 Managing Authority  Beneficiary EUR 10 x 120 hours = EUR 1.200 EUR 800 15 % x EUR 1.200 = EUR 180

10. Part 2: The empowerment and the delegated act (DA)

11. Article 14(1) ESF Reg. The Commission may reimburse expenditure paid by MS on the basis of standard scales of unit costs and lump sums define by the Commission. The Commission shall be empowered to adopt DA (…) concerning the types of operations covered, the definitions of the standard scales of unit costs and lump sums and their maximum amounts, which may be adjusted according to the applicable commonly agreed methods, taking due account of experience gained during the previous programming period.

12. The empowerment means… That there is no obligation to act for the Commission. But there is a strong political commitment from the Commission to support MS in implementing SCOs.

13. The unit costs and lump sums… Included in the DA could be: Designed by the Commission Based on data from the MS

14. The DA will be… Made of two parts: 1. The main part applicable to all MS 2. The annexes (one per MS) There will be a unique DA amended when deemed necessary.

15. The main part of the DA Articles 1 to 4 cover: Subject matter and scope Types of operations Definitions of standard scales of unit costs and lump sums and their amounts Adjustment of amounts

16. The Annex of the DA Is made of two parts: 1. Definition of standard scales of unit costs/lump sums 2. Adjustment of amounts

17. Part 3: The Swedish experience

18. Indicator 1: hourly staff cost PA1 Hourly wage group Stockholm (SE 11) (SEK) All regions except Stockholm (SE 12-33) (SEK) 1 237242 2 266263 3 307292 4 349324 5 433379 6 574535 7 A 765 7 B 829647 7 C 543444

19. Indicator 2: hourly participant cost PA1 Region: Stockholm (SE 11) (unit cost per hour - amount in SEK) All regions except Stockholm (SE 12-33) (unit cost per hour - amount in SEK) 229234

20. Indicator 3: hourly staff cost PA2&3 Occupational categoryRegion: Stockholm (SE 11) (unit cost per hour - amount in SEK) All regions except Stockholm (SE 12-33) (unit cost per hour - amount in SEK) Project leader for operations where the total eligible expenditure as stated in the document setting out the conditions for support is above 20 million in SEK) 535435 Project leader for operations where the total eligible expenditure as stated in the document setting out the conditions for support is below or equal to 20 million (in SEK) / assistant project leader for operations where the total eligible expenditure as stated in the document setting out the conditions for support is above 20 million (in SEK) 478405 Project worker 331300 Project economist 427363 Administrator 297270

21. Indicator 4: hourly participant cost PA2&3 (1/4) Social assistance (unit cost per hour)(SEK) Age 18-24 years32 25-29 years40 30-64 years46

22. Indicator 4: hourly participant cost PA2&3 (2/4) Activity grant and development allowance (unit cost per hour) (SEK) Age 15-19 years17 20-24 years33 25-29 years51 30-44 years55 45-69 years68

23. Indicator 4: hourly participant cost PA2&3 (3/4) Social security and sickness benefit (unit cost per hour)(SEK) Age 19-29 years (social security benefit)51 30-64 years (sickness benefit)58

24. Indicator 4: hourly participant cost PA2&3 (4/4) Sickness benefit, rehabilitation benefit, and work and professional injury benefit (unit cost per hour) (SEK) Age – 19 years48 20-64 years68

25. Please send your comments on the Fiche No 37 to EMPL-SCO-JAP@ec.europa.eu By Friday 22/05 cob at the latest. Thank you!