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ERDF FAQs

Below are a list of frequently asked questions and answers regarding the European Regional Development Fund (ERDF). If need more information, please do get in touch by emailing info@gcgp.co.uk.

This page will be continually updated as new information is released from government.


How long is the programme?

EU funding runs in seven-year cycles. The current programme runs from January 2014 to December 2020.

Can a project be comprised of 100% ERDF money?

No. For projects within more developed areas such as GCGP, ERDF can comprise a maximum of 50% of the cost of the project. Project applicants will need to provide or source at least 50% of the project costs before the ERDF can match fund the project.

Where can and can't match funding come from?

It can be in the form of public or private cash, staff-time or contributions in kind, though the latter can pose difficulties. Match funding cannot be from another EU funding stream. Similarly, the match cannot also be used to match fund another EU project. Volunteer time will not be eligible as match funding. The ERDF guidance on State Aid can be downloaded from this web page.

Which comes first, the ERDF contribution or the match?

ERDF considers itself to be “the funder of last resort” and your ERDF application will need to provide evidence that you have already provided, or have successfully secured, your match funding.

Can I use ERDF to fund statutory activity?

No. ERDF cannot be used to replace statutory funds lost as a result of e.g. budget cuts.

Can ERDF be used to extend a project or activity?

Not directly. ERDF, like most external funding, needs to demonstrate added value. This is sometimes referred to as additionality. Projects should ideally be new or innovative or, at the very least, should be able to clearly show what added benefit or activity is happening as a result of ERDF investment. A previous project or activity may have identified a gap in provision and this may be filled by a follow-on project but the application would need to clearly show the additionality. This benefit will need to reflect the aims of the ERDF programme and also the aims of the LEP.

How do I know what these aims are?

Details can be found in GCGP’s European Structural and Investment Funds Strategy (commonly known as the ESI Funds Strategy), this is referred to as the LEP’s ESIF Strategy in some documentation here.

Details can also be found in the LEP’s Strategic Economic Plan (known as the SEP) here.

It advisable that both the ESIF Strategy and SEP are read prior to considering whether your project aligns with the requirements of the GCGP’s ERDF allocation in your chosen LEP area(s).

How big does my project have to be?

The programme is looking for large strategic projects that will make an impact in the LEP area, or even on a wider geographical scale involving other LEPs. All projects require staff resources at a management and delivery level, so the fewer projects, the smaller the required resource.

The current minimum project size is £1 million in value, i.e. a minimum of £500,000 of ERDF contribution if 50% grant is sought.

As an applicant, you need to be realistic about what you can achieve, how much match funding you have (or can secure) and what level of staff resource you have to successfully deliver a project. Whilst there is no maximum figure, very small projects are unlikely to be considered.

Please bear in mind that value for money will be a key factor in determining whether your project will secure funding. In short, the more you ask for, the more you will be expected to deliver.

Proportionality?

The more you ask for the more you will need to justify in terms of an application and the quantity of narrative within it.

Do I need to have partners?

The programme encourages partnership working. Partners can potentially provide expertise, staff resources and match funding. Partnerships can apply for ERDF funding providing they are constituted as a legal entity.

Alternatively, and more conventionally, one member of a partnership can act as a lead partner on behalf of a partnership bid (and will be the accountable body for claims and investment, etc.). A partnership can help to share the administrative and delivery duties, especially if the project is a particularly large one.

Unlike Interreg or the Territorial Co-operation programmes, there is no requirement for partners to be drawn from other EU countries.

Who is eligible to apply?

Applicants can come from the public, private or third sector. Individual businesses are not able to apply directly for an ERDF grant unless their project includes multiple beneficiaries.

It is more typical that individual businesses will benefit from a multi-partner/sector-based project. A business cannot apply to fund its own endeavours. ERDF eligibility rules can be downloaded from this web page.

Who makes the decisions regarding funding?

The final decision resides with the Managing Authority, which is the Department for Communities and Local Government (DCLG).  They will receive applications and assessment them for technical compliance.

An evaluation report will then be sent to the local ESIF Committee who will comment on the strategic fit with the ESIF Strategy and SEP for their LEP area.

What are the principles behind ERDF investment?

The over-arching objectives of the programme are to promote economic growth and job creation. We will invest the majority of our ERDF funds into business support and innovation, and underpin this with support to the low carbon economy.

In the GCGP LEP area, some investment will be made in projects that provide super and ultra-fast broadband services and contribute to greater digital connectivity.

What are the priorities for ERDF investment in the LEP areas?

There are four main areas where ERDF monies could potentially be utilised, with notional sums allocated against each one. The GCGP ESIF Strategy provides the detail on these priority areas.

Is this money capital or revenue?

The money is predominantly revenue. Whilst there will be some capital available, it will not generally be used for large infrastructure projects, as in previous ERDF programmes.  It should be noted that capital can now match revenue and vice versa in this programme.

What sort of activity will the programme support?

Any project will need to be able to demonstrate a clear economic rationale and measurable benefits and be in-line with the Operational Programme, which is available here.

The four Priority Axes within the GCGP ESIF Strategy are:

  • PA1 – Innovation
  • PA2 – ICT
  • PA3 – SME Competitiveness
  • PA4 – Low Carbon Economy

The call document may be more specific regarding the activity required in response to a particular call.

Outputs?

The ERDF programme has targets (also known as outputs) that need to be achieved. These are negotiated with the EU and are the basis on which EU funding is available to each LEP area. Any project wishing to be funded from the ERDF programme needs to be able to demonstrate that it can achieve the outputs detailed in the call document. Examples of the outputs are listed below and reference should be made to the call document for those outputs applicable:

  • Number of enterprises receiving support or new enterprises supported;
  • Employment increased in supported enterprises;
  • Number of enterprises receiving grants or other financial support;
  • Number of enterprises cooperating with research entities;
  • Infrastructure site development including green infrastructure (ha);
  • Private investment matching public support to enterprises;
  • Estimated Greenhouse Gas (GHG) reductions;
  • Additional capacity of renewable energy production;
  • Number of companies supported with business resource efficiency.

The definitions and guidance can be found here.

Is it a quick process?

No, the call document will give the timetable for submission of the outline application which will include a very full description of the project together with full financial details. After the outline application is submitted it will firstly undergo a rigorous and extensive appraisal process to ensure it is technically compliant with the Operational Programme.

At this point it will be assessed by the ESIF Committee for local strategic fit and if the application also passes this stage then the applicant will be requested to submit a full application within a limited time frame.

A similar process will be undertaken for the full application and if this also gets the green light then the applicant will be requested to sign a funding agreement for the project.

From submitting the outline application to receiving a funding agreement could take in the order of nine months. It is important to bear this in mind when developing your application, securing match funding (especially if it is time limited) and planning the project delivery. This sounds daunting, but there is support available to help you with this process.

Once approved, do we then receive the money?

No. The programme, like many sources of external funding, works on the principle of defrayed expenditure.

This means that money must be spent and claimed back from the ERDF programme, on a quarterly basis or potentially a monthly basis but ensure you can cash flow your project on a quarterly in arrears basis. As with the timescale for approval, it is important to bear this in mind when planning your project.

From whom do I claim the money back?

The lead applicant or accountable body will contract with the Managing Authority.  They will repay eligible monies invested as part of an ERDF project.

Can I claim back any money that I have spent prior to the project being approved that will inform the project?

No. Only spend that happens once your project has been approved can be considered eligible. Any costs that are incurred prior to this cannot be ERDF-supported.

What checks are carried out during the project that I need to be aware of?

Throughout your ERDF project various types of audits will be performed therefore you need to ensure your have factored in time and resources to facilitate these, and have robust processes in place to record, monitor and analyse your delivery performance against internal, ERDF and legal obligations.

Can an organisation profit from an ERDF project?

No, there are strict limitations on making ‘net profit’. These are covered by the Eligibility Handbook that will be released for potential applicants to read with the first bidding round.

Who can explain the complexity in layman’s terms?

It can seem very complicated, but there are ERDF Facilitators based at the LEP who can help you throughout the process. There is a wealth of expertise and experience within GCGP in developing and delivering ERDF projects both in this and in previous funding programmes. Ultimately you will need to seek professional, independent advice for your specific project with regard to eligibility, potential legal issues and technical compliance.

What calls have been issued to date?

Information on Closed calls in the GCGP area can be accessed here.

Information on Lice calls in the GCGP area can be accessed here.

Are there any special arrangements for projects that are planning to be active in more than one LEP area?

As the 2014 to 2020 programme is a national programme an ERDF project can cover contiguous and non-contiguous LEP areas. Each LEP should be consulted regarding multi-LEP projects. The Outline and Full Application forms allow for notional splits between LEP areas, one application should be completed with the application being submitted to the DCLG office of the lead LEP area.

Can I claim for overheads on the project?

With the 2014-20 programme, the process for claiming overhead costs has been simplified. They should be claimed at 15% of eligible direct staff costs.

ERDF Facilitator Details:

GCGP LEP

Stuart Thomas: stuart.thomas@gcgp.co.uk 07715 658013
Paul Bourgeois: paul.bourgeois@gcgp.co.uk, 07912 660152