1. What size should the budget be for regular projects?
The budget of a project proposal is established by the potential applicants forming the partnership, according to the project needs and proposed activities and by taking into account the budget requirements included in the Guidelines for applicants for the 1st call for proposals - Part II- section 8, i.e “Any grant awarded under the Interreg NEXT BSB Programme for the implementation of a regular project must fall between minimum EUR 500,001 - maximum EUR 1,500,000 (Interreg funds).”
2. Do public authorities have to submit financial accounts, balance sheets and other required documents?
Public authorities are not required to submit financial capacity self-assessment, annual accounts, balance sheets, statute or registration acts.
However, according to the Guidelines for applicants - Part II - section 14 all applicants including public authorities are required to provide documents listed under points 1, 2 and 4 (Declaration of Lead Partner/project partner, Order/act for official authorization of delegated person signing the Declaration by the Lead Partner/ Project Partner, if the case and Feasibility study or equivalent document, if the case).
3. Is VAT eligible under the Programme?
In accordance with the Guidelines for applicants for the 1st call for proposals – Part II – section 10.4,
VAT is considered eligible in projects funded under Interreg NEXT BSB Programme.
Nevertheless, project partners which according to their national legislation are entitled to recover VAT from other sources, shall not include in the project budget and reimbursement and/or payment requests the amounts representing the VAT corresponding to the reported/requested eligible expenditure (e.g partners from Moldova are VAT exempted and therefore they shall not budget tax related expenditure).
4. Will the required minimum 10% co-financing amounts be paid by the national authorities or by beneficiaries? Are there exemptions from co-financing in the project?
In accordance with the Guidelines for applicants for the 1st call for proposals – Part II – section 10.3,
The national co-financing may take the following forms:
- Beneficiary’s own resources;
- Financial contributions by national governments, third parties, from sources other than the European Union.
Each participating country shall decide on its own co-financing system (from national/ regional/local level or directly from the beneficiary, or both from the national/regional/local level and from the beneficiary itself). No resources from other EU Assistance may be taken into account as co-financing.
The final amount representing co-financing will be established at the final report.
Co-financing rate (10%) will be equal for all project partners.
We recommend each applicant to contact the National Authority of their country related to this issue. The contact person and the contact details are available in the INTERREG NEXT Black Sea Basin Programme, section 7.1 Programme authorities.
5. Regarding the reporting process, should each Partner prepare a narrative and financial report for each reporting period (every 4 months)? And how will the payments be made to the partners? Will the partnership receive an interim payment distributed equally to the partners, or will the distribution be made based on what each partner spends?
Project partners will have to submit several narrative and financial reports, covering every 4 months of implementation. The number of reports depends on the length of the implementation period and will be automatically calculated by Jems as soon as the total project duration is introduced.
According to the Guidelines for applicants for the 1st call for proposals – Part II – section 10.2 (take note box), The payments to beneficiaries under Interreg NEXT BSB programme shall include:
- Advance payment – maximum 30%
- Several interim payments – linked and based on actual expenditure made and reported
- The advance will be recovered by deducting 20% from the eligible value of the next payment requests until the amount is recovered;
The payments will be made by the MA to the Lead Partner who shall be responsible for transferring the amounts to each project partner, as follows:
- Advance payment – maximum 30% calculated to the total budget estimated by each partner;
Interim payments – amount will depend on the actual expenditure made and reported by the respective partner, less 20% from the eligible value of the reported amount representing recovery of the advance payment.
6. Considering the 4-month reporting period, if a project has an 18 months duration, does that mean that during project implementation there will be 5 reporting periods and also 6 tranches?
For an 18 months project, there will be 5 reporting periods and 6 tranches.
7. As the staff costs are flat rate, do we still need to put in all staff positions and distribute this 20% among them? Or there is just one line for staff costs in the budget form?
According to the Guidelines for applicants for the 1st call for proposals – Part II – section 10.2 – Budget line 1 Staff costs:
The budget line 1 “Staff costs” will be automatically calculated in Jems, as soon as the amounts for the budget lines 3 “Travel and accommodation”, 4 “External expertise and services”, 5 “Equipment” and 6 “Infrastructure and works” are filled in.
Consequently, there is no need to introduce any staff positions.
8. Regarding staff cost, is it mandatory to respect the percentage of 20%, or "up to" 20% could be accepted? Furthermore, if an organization cannot use budget for staff costs, is the 20% allocation to staff costs mandatory?
The percentage is fixed to 20%, as Jems automatically calculates it. The 20% is applied on the other estimated direct costs.
If an organisation cannot use the budget for staff costs, the respective partner shall not “select” the box “Staff costs flat rate (20% of eligible direct costs other than staff costs)” under section Partner Budget Options.
9. Is it possible to purchase equipment? What amount is recommended?
According to the Guidelines for applicants for the 1st call for proposals – Part II – section 10.2 – Budget line 5 Equipment - In accordance with Article 43 of Regulation (EU) 2021/1059 (Interreg), the following exhaustive list contains the cost items which could be included under this budget line:
- Office equipment;
- IT hardware and software;
- Furniture and fittings;
- Laboratory equipment;
- Machines and instruments;
- Tools or devices;
- Vehicles;
- Other specific equipment needed for the project.
There is no limitation or recommendation regarding the amount. However, the costs have to be necessary for the project implementation and observe the principle of sound financial management: economy, efficiency and effectiveness.
10. Can we purchase second-hand vehicles? How their costs will be reimbursed: i.e. as amortizations of an equipment, or as the initial purchased value?
Costs for the purchase of second-hand equipment may be eligible, subject to the following conditions
(a) no other assistance has been received for it from the Interreg funds or from the funds listed in point (a) of Article 1(1) of Regulation (EU) 2021/1060;
(b) its price does not exceed the generally accepted price on the market in question; and
(c) it has the technical characteristics necessary for the operation and complies with applicable norms and standards.
11. Can the salaries of the working staff involved in the implementation of a project be considered as co-financing?
For Regular projects
As the staff costs is covered as a flat rate of 20% to the direct costs, and the amount representing flat rate will be reimbursed as a top-up on each payment from Interreg funds, the salaries cannot be considered co-financing.
For Small Scale projects
Being reimbursed as real costs, part of the salaries shall represent co-financing.
12. Should the co-financing be in cash or can be put through staff, equipment, building allocation, etc.? And does this differ for regular and small projects or is it the same?
For small scale projects, the staff costs can be accepted as co-financing. To be observed that for this type of projects, all other costs are reimbursed as flat rate of 40% of the direct eligible staff costs.
Please also see the answer to question no.58.
As a general rule, according to the Grant Contract, Annex 9 to the Guidelines for applicants for the 1st call for proposals, any contributions in kind do not represent actual expenditure and are not eligible costs.
13. Are costs incurred before the project start (for project proposal preparation) eligible for reimbursement under the project budget?
According to the Guidelines for applicants for the 1st call for proposals – Part II – section 10.1, …. expenditure is eligible for funding when fulfilling the applicable national legislation, as well as respecting the specific rules described in the Common Provisions Regulation (EU Regulation 2021/1060) and the Interreg Regulation (EU Regulation 2021/1059).
The expenditure should mainly: Be incurred during the implementation period of the Project and paid before the submission of the final report;
The only exception relates to documentation for projects including an infrastructure component which are eligible if they are incurred after the date of 1st of January 2021.
14. Are the consumables and fuel eligible expenses?
Regarding expenses for consumables, according to the Guidelines for applicants for the 1st call for proposals – Part II – section 10.2 Budget line 2 Office and administration, in accordance with Article 40 of Regulation (EU) 2021/1059 (Interreg), the following exhaustive list includes the cost items which could be included under this budget line:
- Office rent;
- Insurance and taxes related to the buildings where the staff is located and to the equipment of the office (e.g. fire, theft insurance);
- Utilities (e.g. electricity, heating, water);
- Office supplies and other consumables;
- Accounting;
- Archives;
- Maintenance, cleaning and repairs;
- Security;
- IT systems (operating/administrative IT services of general nature, linked to the implementation of the project);
- Communication (e.g. telephone, fax, internet, postal services, business cards);
- Bank charges for opening and administering the project account or accounts;
- Charges for transnational financial transactions.
Regarding expenses for fuel, according to the Guidelines for applicants for the 1st call for proposals – Part II – section 10.2 Budget line 3 Travel and accommodation, in accordance with Article 41 of Regulation (EU) 2021/1059 (Interreg), travel and accommodation costs shall be limited to the following elements:
- Travel costs (such as tickets, travel and car insurance, fuel, car mileage, toll, and parking fees);
- Costs of meals;
- Accommodation costs;
- Visa costs;
- Daily allowances.
15. Do all partners have to provide co-financing or is it sufficient for one partner (e.g. the lead partner) to provide the co-financing amount?
Jems calculates automatically the share of Interreg funds and co-financing for each partner, as soon as project budget is defined by each partner. The co-financing rate is 10% for all partners.
See also the answer above to question no. 51.
16. Is the 30% advance payment calculated from the total budget, which includes co-financing?
The 30% advance payment shall be granted from Interreg funds, that is 30% from the 90% share of Interreg funds.
17. What eligible costs will be reimbursed (e.g. total costs) and how will the 20% for the advance payment be deducted?
The Programme only reimburses the Interreg share of the amount certified in a report. The advance will be recovered by deducting 20% from the Interreg eligible value of the next payment requests until the amount is recovered. If the advance is not recovered from the interim payment requests, the percentage for deduction may be increased in the request for the final balance.
18. The 1.5 months for reporting is for the whole project consortium?
Indeed, the 1.5 months for reporting is for each project partner within the consortium to submit to the controllers the report for expenditure verification.
19. How long does it take to receive a payment?
According to the Grant Contract, Annex 9 to the Guidelines for applicants for the 1st call for proposals, the interim and final payments shall be made by the Managing Authority (MA) within 45 days of receipt of the payment request from the Lead Partner, subject to the approval by the MA of the accompanying interim and final reports.
20. Shall we provide amounts for the FLC in the budget?
Indeed, irrespective of the type of project, the budget shall include costs for FLC (controller).
For small scale projects, please note that all costs are reimbursed as flat rate of 40% of the direct eligible staff costs.
For regular projects they will be budgeted under external expertise and services budget line.
21. How can we calculate staff costs? Can it be a fixed salary?
The staff can be allocated to work full-time (100% of the working time is allocated to the project) or part-time for the project (flexible number of hours).
22. Can salaries include taxes and social security payments?
Staff costs expenditure consists of the gross employment costs of staff employed by the project partners for implementing the project. For detailed information related to staff costs please refer to section 10.2 from Part II of the Guidelines for applicants for the 1st call for proposals.
23. Costs for purchasing equipment are eligible?
Yes. However, you shall keep in mind the provisions of section 10.2 - Part II of the Guidelines for the applicants for the 1st call for proposals, according to which: “Costs under this budget line refer to expenditure by a project partner for equipment purchased, rented or leased specifically for the purpose of the project, which should be listed in the approved project budget.
In accordance with Article 43 of Regulation (EU) 2021/1059 (Interreg), the following exhaustive list contains the cost items which could be included under this budget line:
- Office equipment;
- IT hardware and software;
- Furniture and fittings;
- Laboratory equipment;
- Machines and instruments;
- Tools or devices;
- Vehicles;
Other specific equipment needed for the project.”
24. For small-scale projects, should we only fill in information for personnel costs and should not fill in any budget lines for expected travel costs, external services (including FLC services) and equipment?
Indeed, this is the approach for small scale projects, which is different to regular projects. For small scale projects, all costs are reimbursed as flat rate of 40% of the direct eligible staff costs. Thus, the project budget will not actually include a detailed forecast of all the other expenses necessary to implement the project.
25. Can we include in the project budget costs for participation of staff, personell, etc to training events, meetings, other events organised by MA, JS, NA?
Yes, according to Part II of the Guidelines for applicants, section 10.2 Project budget – Budget line Travel and accommodation – Text box:
“It is recommended to foresee in the budget a reasonable amount of costs under Travel and accommodation budget line necessary for participation in programme related activities (ex. Participation in meetings with MA/JS, programme events, etc).”
Please remember that the Travel and accommodation costs are not eligible for experts who are budgeted under external expertise and services budget line.
26. What are the applicable rules of nationality and origin for procurement?
In case of beneficiaries located in EU Member States, which are contracting authorities/ entities within the meaning of the Union law applicable to public procurement procedures, the rules of nationality and origin are according with their national law.
In all other cases, there are no rules of nationality and origin according to the Interreg Regulation (REGULATION (EU) 2021/1059 on specific provisions for the European territorial cooperation goal (Interreg) supported by the European Regional Development Fund and external financing instruments).