European Commission Gives Go-Ahead to Lump Sum Funding Model for Horizon Europe

Successful conclusion of pilot project conducted over the final three years of Horizon 2020 ensures the lump sum funding model can continue where appropriate under Horizon Europe.

The European Commission has published a report setting out the findings from its ‘lump sum’ pilot, endorsing the funding model for wider use under Horizon Europe.

The lump sum pilot was launched under Horizon 2020 in 2018 as an alternative to the established funding model based on the reimbursement of actual costs, which could be a complex process and was open to errors, especially for personnel costs.

The lump sum model removes all obligations on actual cost reporting, time sheets, and financial ex-post audits. The pilot project was launched to test whether the model worked in practice, and sought to analyse its potential for simplifying project management, avoiding errors, and shifting the focus from financial controls to content.

The pilot consisted of 16 topics covering all main types of grants, and of different sizes and complexity, including for large and complex multi-beneficiary projects. To date, more than 1,500 proposals were submitted in the pilot, resulting in 478 lump sum grants, with another 46 projects currently in grant preparation.

The Commission has monitored the use of the lump sum model from the start to test its effectiveness. It has also collected feedback from stakeholders involved in the lump sum pilot during the R&I Days 2020 and in several dedicated workshops and outreach activities, and conducted four online surveys among the main groups directly involved in the pilot.

Based on this approach, the Commission has concluded that the lump sum approach works in practice and is fit for wider use in Horizon Europe. The lump sum pilot was found to deliver on its main goals to simplify administration and shift the focus to the content of projects. The results further suggest that lump sum funding can be used for any type of action, including for large multi-beneficiary projects, without increasing burden or decreasing satisfaction of users.

The findings indicated a particularly positive attitude of SMEs compared with other organisations towards some key areas, such as on effort and feasibility. Smaller budgets and smaller consortia were also associated with more positive replies. Although lump sum funding was found to be suitable for all calls, these findings may be taken into account when selecting the most suitable calls.

Users also made suggestions for improvements, and the Commission is working to address these points through better guidance, further simplification, and aligning the rules for lump sum grants under Horizon Europe even more to the rules for standard grants.

The full assessment of the lump sum pilot is available on the European Commission website.

(This report was the subject of a ResearchConnect Newsflash.)