Laboratory on

EU COOPERATION PROJECT DESIGNING FOR

COOPERATIVES IN DEVELOPMENT (3 cfu)

within the JEAN MONNET CHAIR

Rethinking the EU trade policy for development (REUTRADE)

Ref: 587814-EPP-1-2017-1-IT-EPPJMO-CHAIR

Academic Year 2017-2018

Project elements & Project Cycle Management

Laurea Magistrale in Scienze dello Sviluppo e della Cooperazione Internazionale

With the support of the Erasmus+ programme of the European Union

What is a project?

A project could be defined as a series of Activities aimed at bringing about clearly

specified objectives within a defined time-period and with a defined budget.

(PCM Guidelines)

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Elements of a project (I)General Objective: describes the long term benefits that theproject contributes to produce. The attainement of thoseobjectives goes beyond the single project, but they define the«direction» (ex. “Reduction of the air pollution”)

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Specific Objective: describes the benefits that the project willproduce for the community, as way for contributing to thegeneral objective (ex. “Increase in the use of public transport”)

Expected Results: Results diirectly produced by the Activities of the project and leading to the attainement of the specific objectives(ex. “2 new bus lines”)

Target groups (beneficiari diretti): groups and individualsdirectly involved or reached by the activities of the project (ex.Drivers and staff of the bus company, People reached by theawareness campaign on the use of the public transport, etc)

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Elements of the project (II)

Final Beneficiaries (beneficiari indiretti) : the wider collectivitythat indirectly benefits from the project implementation (es. the inhabitants of the city benefiting from the reduction of the pollution)

Co-applicants (partners): All the organizations that contribute tothe realization of the project activities and to this scope they makeuse of part of the funding. The Partership should be built on thecompetences of each partner to contribute to a specific part of theproject. It s crucial the good balance among the nationalities ofthe partner organizations, and the local ownership of the action.

Leader Applicant + Co-Applicants are referred as «The Applicants»

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Leader applicant: the organization that is main responsible forthe overal implementation of the project in front of the donor,especially on the financial management. It is critical its financialcapacity as well as its technical experience.

The Partnership

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Associates: organizations that declare their interest toward theproject objectives and intention to contribute to their attainement,but do not use the project budget to this scope.

Affiliated entities: organizations that are connected to the Applicantor Co-Applicant through a legal linkage (branches, controlled orcontrolling companies, etc).

Contractors: the project can foresee that some services or worksare commissioned to subcontractors by the. Associates andAffiliated entities cannot be contracted as subcontractors (forconflict of interest). The General Conditions and the PRAG definethe rules for the tendering.

The Partnership

PROJECT CYCLE MANAGEMENT (PCM)

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In 1992 the European Commission adopted “Project CycleManagement” (PCM) as its primary set of project design andmanagement tools (based on the Logical Framework Approach),The Project Cycle Management is a process for the management ofphases of a project/programme with the aim of :

Ensuring that the projects are coherent and integrated to theother EU Policies

Ensuring that the projects respond to the needs of theBeneficiaries, and that they are involved in the process

Guarantee the sustainability of the project results

Guarantee the continuous improvement of the projects andprogrammes, though their monitoring and evaluation.

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PCM

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Phases of the PCMProgramming: For the EU is the definition of its policies and

programmes. For the Italian AICS for instance correspond to the 3-year Plan «Documento Triennale di Programmazione e indirizzo». For the CSOs it represents the moment when they define their ownpolicies and priorities for the following period (priority country or sectors, etc).

Identification: it is the moment “ø” of each project, where needs of target communities are identified and prioritized (needs assesmentand prioritization). This is a critical moment for ensuring the «Relevance» of the project. In this phase it is useful the «Problemstree»

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Phases of the PCMFormulation: on the basis of the priorities and needs identified,

the project idea is elaborated, detailing the activities, the expected results, the budget, etc. In this phases it is useful(and compulsory) the «Logical Framework».

Normally, the «financing» of the action comes between itsformulation and implementation phases.

Implementation: realization of the foreseen activities, includingmoniroting ones.

Evaluation and Audit (ex post): evaluation of the results attainedby the project for improving the future programming and for facilitating the identification of further needs and new projectopportunities.

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Problems tree analysisThe Problem tree analysis is composed of the:

Identification and clarification of the needs,

Their prioritization and organization into dyagram emphasizing the relation between causes and effects (the problems tree).

Tips:

Avoid to elaborate the problems ...

.. as generic or too vague

… in terms of «missing» of a certain solution

…by using personal judgments or opinions (as long as possible)

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Problem tree sample

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The Logical Framework

Il Quadro logico (Logical Framework) is a matriz that sums up allthe project, logically connecting all its elements. Moreover the LF is useful for understand which external conditions can impact on the positive results of the project and are thereforetaken into consideration.

For some EU programmes, as well as for most of other donors, the Logical Framework is always compulsory to be included/attached in the Application form.

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Da CONCORD Guidelines on the Logical Framework 2016

Activities and Working PackagesThe results and objectives are attained through the implementation

of activities for which it should be defined the budget, the timing and the resposibilities. The activities are grouped into Workingpackages (sometimes project phases when).

For each working pachage you should identify:

• One responsible partner (considering competences)

• The involved partners, their working hours and the otherresources to be used (budget)

• The timing (start and end)

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Standard Working PackagesWP n°x: Management: financial and technical management of the

project, coordination among partners and relations with the donor(reports). This WP must be lead by the Leader Applicant

WP n°X+1: Communication and Dissemination (newsletter, website,brochure, pubblications, internal communication, etc.)

WP n°y, n°y+1, n°y+2, etc.: «technical» WP where are specified theactual project interventions. Usually each technical WP correspondsto an Expected Result.

Some years ago, some EU programmes (mainly ETC) used to demand a specific «CapitalizationWP». Recently this is no more required because each Programme funds specific Capitalizationprojects working for capitalizing all other projects.

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WorkplanGen Feb Mar Apr Mag Giu Lug Ago Set

WP2

Att 2.1

Att 2.2

WP3

Att 3.1

Att 3.2

…..

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Watch out for the cash flow..

Usually the EU does not cover 100% of the project costs, butrequires a Co-financing from the Partnership (or throughexternal resources).

The EU Co-financing is bewteen 50% and 100% (for EuropeaidProgrammes is usually around 80%). Usually the remainingpart is covered by the partnership by valorizing the work oftheir staff. It is almost never possible to valorize also the valueof the building or equipment of the partnership put at disposalof the project (in-kind contribution).

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The Budget (I)

The budget is composed of Budget Lines grouped into BudgetHeadings (ex. Travel, Human Resources, etc). In the realization of a project you can foresee(justifying them) some changes to the budget moving resources from oneHeading to another. Under a certain threeshold (normally between 15 and 25%) they are considered «Minor Changes» so that you can simply «notify» them at the moment of the financial reporting. Above those threeshold theyare considered «Major Changes» that require an Amendment to the Grant Contract.

Normally it is possible to include in the budget a «contingency reserve» (maximum 5% of the budget) that can be activated, upon approval, during the project implementation for overcoming major inespected probles thatundermines the attainement of the project results.

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The Budget (II)

Standard Budget Headings

1. Human Resources

2. Travel and Per Diem (sometimes Per Diem are insde Human Resources)

3. Equipments and supplies

4. Local Office

5. Services

6. Other (specify)

7. Administrative Costs(max 7%)

8. Contingency reserve (max 5%)

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Budget WorksheetThe Excel fil of the budget is composed of 3 worksheets:

1. BudgetBudget lines, the unit cost and

quantity

2. JustificationsIncluding the Justification for each budget line (why you need it) and an explanation on

the method for estimating it.

3. Expected sources of fundingWhere you should define the origin of the co-fundings (from applicants, external donor,

or revenues produced by the project).

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Costs eligibilityTO be eligible the costs must be:

spent during the project implementation period (a part some exceptions such as the financial audit and sometimes the “preparation costs”)

Directly and exclusively linked to the project (for instance the purchase of a laptop is eligible only if you use it ONLY for the project and if you actually need it for implementing the activities)

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Tazes are normally not eligible, unless:

Are included into the cost of a service (es. flights taxes)

Direct taxes of staff (always eligible as well as social securities and all other costs connected to the work contract)

VAT… only eligible when you can demonstrate that youcannot recover it (you shouldn’t have VAT code)

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Eligibility of taxes

Costs are reimbursed on the basis of the “actual costs incurred”, to be documented with invoices(or recepits) and demonstration of the payment (possibly bank transfer).

In few cases can derogate and you can apply simplified costs (Maximum 60.000€ Vd. ANNEX K)

UNIT COSTS: these cover all or certain specific categories of eligible costs which can be clearly identified (as indicated in the Budget at proposal stage) and are expressed in amounts per unit.

Example: unit cost per working month for personnel costs based on internal policies and average (payroll) costs; unit costs for small local transportation or other expenses in rural areas (often in expense categories with many small value items and/or with poor documentation), etc.

LUMP SUMS: these cover in global terms all or certain specific categories of eligible costs which can be clearly identified (as indicated in the Budget at proposal stage).

Example: global cost for the organisation of an opening event, global cost for the production of information videos etc.

FLAT RATE: this covers specific categories of eligible costs which can be clearly identified (as indicated in the Budget at proposal stage) and are expressed as a percentage of other eligible costs.

Example: local office costs and related expenses (maintenance, security, a shared car etc.) charged as a percentage of staff costs, indirect costs, etc.

Ps. Per diems are not considered simplified costs 25

Simplified costs

Sample of simplified costs in the budget:

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27Europeaid Project Cycle Management Guidelines

Evaluation