Earth Observation data capability enhancement - guidance

Question 1

1.  Introduction

Accepted Answer

The UK Space Agency are launching this funding call to improve UK Earth Observation data handling capabilities, which will assist UK entities in accessing future commercial opportunities in this field.

Question 2

2.  Call objectives, scope and key information

Accepted Answer

This call is looking to fund enhancement of capabilities and capacity in UK Earth Observation data handling, to ensure UK entities can be competitive in future opportunities. We are specifically looking to fund the “midstream” part of the Earth Observation value chain, including but not limited to the following activities:

data acquisition
data processing
data storage
data interoperability
data assurance
data dissemination

The UK Space Agency is open to a variety of research and development ideas that will improve these capabilities. This can include early-stage activity such as roadmaps or studies, or hardware or software to help companies advance their own midstream capabilities and competitiveness.

We are particularly interested to fund bids that seek to develop existing commercially operational capability or capacity which can put UK entities in a stronger position to bid for ESA missions, including ESA Copernicus Frameworks. In the event this call is oversubscribed and more fundable proposals are received than the UK Space Agency has budget to support, priority will be given to bids that focus on this area.

Activities related to the “upstream” or “downstream” parts of the value chain are not in scope of this funding call and therefore ineligible. This includes:

designing and building spacecraft for data detection
developing applications that utilise acquired data

Important information for applicants

awarded projects will start from September 2024 and must have fully completed by 31 March 2025
this call will close at midday on 31July 2024. No extensions are permitted and late applications will not be accepted
grant funding per project is expected to range from £10,000 to £80,000, and we expect to make between 2 and 5 awards. In exceptional circumstances, the UK Space Agency reserve the right to adjust the value or duration of the grant funding available
this grant scheme complies with the Subsidy Control Act 2022 and awards are made under the Streamlined Route for Research, Development and Innovation. Companies applying for this funding will need to demonstrate they meet eligibility requirements for this scheme, including not having received previous project funding in excess of the cumulation caps within the scheme (£3 million for the same project, or substantially the same policy objectives). Further information on eligibility requirements is listed in section 4.1 below and in Annex 1 (Subsidy control).
questions or clarifications can be directed to commercial@ukspaceagency.gov.uk
the UK Space Agency reserves the right to reject proposals if they are outside the call remit, do not contain all of the required information or do not provide sufficient information for assessment
protection of any Intellectual Property (IP) rights on the project will remain the responsibility of the project participants. The UK Space Agency does not seek any ownership of project IP. Future ownership of any potential IPR should be dealt with as part of any Flow Down Agreement
all proposals must be led by organisations based in the United Kingdom

Question 3

3.  Call and delivery timeline

Accepted Answer

The following schedule sets out the indicative timing of processes for this call. Please note that each deadline may be subject to change in the event of operational constraints.

Event	Date
Call opens	17 June 2024
Call closes (full proposal deadline)	Midday on 31 July 2024
Successful applicants notified	By 12 August 2024
Project kick-off	1 September 2024
Projects conclude	31 March 2025

4.1. Subsidy control: Research organisations, public and third sector

The UK Space Agency supports organisations to invest in research, development and innovation. The support we provide is consistent with the UK’s international obligations and commitments to subsidy control. Please see this page for further information about the UK Space Agency’s obligations under the Subsidy Control Act 2022. To ensure this competition provides funding in line with obligations and commitments, the intervention rates detailed in section 4.2 shall apply, unless:

the applicant seeks to claim exemption from having to make a contribution under the Minimal Financial Assistance Allowance (previously known as de-minimis under State Aid and Small Amounts of Financial Assistance under Trade and Co-operation Agreement) rules
the applicant is a research or public sector organisation or charity pursuing non-economic activity

When referring to research organisations, the UK Space Agency uses the definition from the Framework for State Aid for Research and Development and Innovation which states:

‘research and knowledge dissemination organisation’ or ‘research organisation’ means an entity (such as universities or research institutes, technology transfer agencies, innovation intermediaries, research-oriented physical or virtual collaborative entities), irrespective of its legal status (organised under public or private law) or way of financing, whose primary goal is to independently conduct fundamental research, industrial research or experimental development or to widely disseminate the results of such activities by way of teaching, publication or knowledge transfer. Where such entity also pursues economic activities, the financing, the costs, and the revenues of those economic activities must be accounted for separately. Undertakings that can exert a decisive influence upon such an entity, for example in the quality of shareholders or members, may not enjoy a preferential access to the results generated by it.

Within the UK Space Agency, this means:

universities – higher education institutions
non-profit research and technology organisations (RTOs) including catapults
public sector organisations (PSOs)
public sector research establishments (PSREs)
research council institutes
research organisations (ROs)
charities

Research organisations should be non-profit distributing to qualify. They should explain how they will disseminate the output of their project research as outlined in the application. Research organisations who are engaged in economic activity (ie, putting goods or services onto market) will be treated as business enterprises and subject to subsidy control intervention rates.

Research organisations

Research organisations undertaking non-economic research activity will be funded at 80% of full economic cost. All other research organisations will be funded at 100% of eligible costs.

Public sector organisations and charities

Public sector organisations and charities can work with enterprises to achieve innovation through knowledge, skills and resources. These organisations must not take part in any economic activity or gain economic benefit from a project. They can apply for 100% funding of eligible costs, providing all of the following conditions are satisfied:

they are undertaking research (this may be experimental, theoretical or critical investigation work to gain knowledge, skills or understanding which is vital to the project)
they meet requirements for dissemination of their project results and state in the application how this will be achieved
they include eligible costs for research purposes in the total research organisation involvement
they ensure they are not applying for funding towards costs which are already being paid from the public purse such as labour or overheads

Third sector

Third sector organisations are primarily voluntary and community organisations, such as associations, self-help groups, mutuals and cooperatives. Third sector organisations can be non-funding partners in a project.

4.2. Subsidy control: Enterprises

Streamlined Scheme for Research, Development and Innovation

This award is being offered under the Research, Development and Innovation Streamlined Subsidy Scheme subcategory 2: Industrial Research and Experimental Development Projects in accordance with section 10(4) of the Subsidy Control Act 2022. Projects funded as part of this scheme qualify as “industrial research” or “experimental development”, where: 

“industrial research” means the planned research or critical investigation aimed at the acquisition of new knowledge and skills for developing new products, processes or services or for bringing about a significant improvement in existing products, processes or services. It can include the creation of component parts to complex systems and may include prototypes in a laboratory or environment with simulated interfaces to existing systems, particularly for generic technology validation
“experimental development” means acquiring, combining, shaping and using existing scientific, technological, business and other relevant knowledge and skills with the aim of developing new or improved products, processes or services. This may include, for example, activities aimed at the conceptual definition, planning and documentation of new products, processes or services

Experimental development may comprise prototyping, demonstrating, piloting, testing and validation of new or improved products, processes or services in environments representative of real-life operating conditions. The primary objective is to make further technical improvements on products, processes or services that are not substantially set. This may include the development of a commercially usable prototype or pilot which is not necessarily the final product and which is too expensive to produce for it to be used only for demonstration and valiation purposes.

Experimental development does not include routine or periodic changes made to existing products, production lines, manufacturing processes, services and other operations in progress, even if those changes may represent improvements.

Further guidance around these definitions can be found within the Research, Development and Innovation Streamlined Route guidance. The onus is on applicants to determine which category their project falls within based on their knowledge of the work they are proposing to undertake and the UK Space Agency cannot provide pre-application advice on which to select.

Subsidies given under these categories are subject to maximum award amounts and subsidy ratios set out in the Research, Development and Innovation Streamlined Subsidy Scheme. These are as follows: 

Organisation type	Industrial research	Experimental development
Small enterprises	70% of the eligible project costs	45% of the eligible project costs
Medium enterprises	60% of the eligible project costs	35% of the eligible project costs
Large enterprises	50% of the eligible project costs	25% of the eligible project costs
Academic partner	80% full economic cost	80% full economic cost

Enterprises may receive a 15% uplift to the subsidy ratios where the project involves collaboration between enterprises, where at least one of the enterprises is an SME, or between an enterprise and one or more research and knowledge dissemination organisation, which must have the right to publish its own research results. Academic partners on projects led by enterprises will still be funded in all cases at 80% of full economic cost.

For the purposes of subsidy control, the following definitions are applicable: 

a small enterprise has an annual turnover below £10.2 million, a balance sheet total below £5.1 million and the average number of employees must not be more than 50 
a medium enterprise has an annual turnover below £36 million, a balance sheet total below £18 million and the average number of employees must be no more than 250 
a large enterprise has an annual turnover above £36 million, a balance sheet total above £18 million and the average number of employees is above 250

To qualify, 2 of the 3 conditions in the above definition must be met. 

Applicants should note that the maximum award amount for both industrial research and experimental development projects is £3 million per enterprise per project. Due to cumulation rules and limits of the scheme, organisations seeking project funding that would exceed a total of £3 million from public bodies in the last 3 years for this project will be ineligible to apply for this opportunity.

Applicants must ensure that they supply the correct information that allows the UK Space Agency to award grants within the scheme. It is the responsibility of the grant funder to ensure compliance with the relevant subsidy controls rules and the applicant to assist the funder in doing this by acting within the terms and conditions of the scheme.

4.3. Subsidy control: Minimum Financial Assistance

The Subsidy Control Act 2022 includes provision relating to Minimum Financial Assistance (MFA). MFA allows authorities to provide grants that are considered small enough to support individual businesses without giving them an unfair advantage. Enterprises can receive up to £315,000 of MFA funding over a rolling 3 fiscal year period without having to provide match funding. You must declare any previous MFA awards you have received in your application form.

When calculating eligibility for the application of the MFA provision, applicants must also include cumulation of any EU State aid de minimis grants under the EC’s de minimis regulation and Small Amounts of Financial Assistance (SAFA) under the EU Trade and Co-operation Agreement (TCA) for the same 3 fiscal year period. The maximum total under the EC de minimis regulation is €200,000, the maximum total under SAFA is £340,000 or 325,000 Special Drawing Rights. This is for all project types and for most purposes, including operating aid.

The application form asks you to tell us about any awards, including those made under de minimis and SDR, (from any source of public funding) over a rolling 3 fiscal year period.

If you have received an award under de minimis or SDR for the same period, this will be added to your total allowance under MFA. This means that the total award must not exceed £315,000 for any one organisation. You must declare this allowance to any other funding body who requests it.

If you are seeking to apply for more than £315,000, any funding required beyond your remaining MFA allowance would require you to meet the match funding requirements set out in section 4. For example, if an enterprise applies for a £500,000 grant and seeks to claim £315,000 as MFA, the remaining £185,000 would be subject to match funding requirements.

Question 4

5.  Eligibility requirements

Accepted Answer

5.1. General eligibility requirements

All successful proposals will address the following mandatory requirements:

the project must be led by a UK organisation who will receive a grant from the UK Space Agency. This can be any type of UK organisation including university-led academic research proposals and Industry-led commercial research proposals
grant recipients must demonstrate the ability to effectively manage a project
grant recipients must have a UK bank account and all grant payments will be made in UK sterling (as per grant funding agreement)
as per the terms of the Grant Funding Agreement, the lead organisation will be required to put in place a collaboration or Flow Down Agreement that ensures all terms and conditions within the Grant Funding Agreement are passed onto project partners. This should be in place with 28 days of signature. This should include provisions regarding how the results of the work, including any IPR and spinouts, will be exploited by project partners
all project members must have in place and provide evidence when requested of appropriate anti-bribery and anti-corruption policies
all project members must be able to provide evidence that they are GDPR compliant
all project members must provide evidence of a process for declaring and managing conflicts of interest
projects cannot work in areas that are in active conflict and any travel to overseas areas must comply with Foreign, Commonwealth and Development Office (FCDO) travel advice
projects must pass due diligence checks on company viability and national security (including financial standing assessment, governance assessment, conflicts of interest assessment, national security assessment and technical expertise assessment). The UK Space Agency reserves the right to withdraw any offer in the event an applicant does not pass any of these requirements
projects must comply with the rules stated in this guidance document

5.2. Project requirements

The project team will be required to be part of the following (but not limited to) as part of project management:  

the grant recipient will attend a kick off meeting to initiate each project
the grant recipient will invoice upon completion of the milestones set out in the application
the grant recipient will provide evidence of meeting the milestones and providing deliverables agreed in their GFA
the grant recipient will also schedule a final review meeting with the coordinator at the appropriate time
the grant recipient will provide a final project report including but not limited to an executive summary, delivery, actual outcomes, lessons learned, benefits, communication and outreach, next steps. This final report should be IPR free and not contain any confidential information, as it may be uploaded onto the UK Space Agency website
the grant recipient will provide required information to support the UK Space Agency’s North Star Metric monitoring at award stage

5.3 Financial requirements

Grant funding is offered on a cost recovery basis only. This means grant funding can only be used to cover the cost of delivering the agreed activity or goal as set out in the project plan. Any surplus funds not spent will be lost to the project unless there are alternative arrangements agreed.

Applicants cannot receive any funding from other grants or contracts to undertake the same activities.

Funding cannot be rolled over between financial years without explicit consent from the UK Space Agency.

All partners must have a separate, project specific accounting code or bank account for project funds to enable a clear audit trail.

Invoices

The UK Space Agency will only pay on receipt of evidence of actual costs incurred and therefore we expect invoices may differ from forecasts. Should actual costs incurred be greater than the value of the milestone value, these costs will be borne by the Grant Recipient, unless the additional expenditure has been agreed with the UK Space Agency ahead of the costs being incurred and a Grant Change Note (GCN) has been executed.

Pay costs

Staffing costs must be calculated on a cost recovery basis only and broken down by pay costs and overheads separately. Pay costs are calculated based on PAYE records. They should include gross salary, employer National Insurance (NI) contributions and employer pension contributions. Pay costs must not include:

any profit margins
commercial charge-out rates
allowances for bonuses and benefits-in-kind
business development
travel and subsistence (eligible project costs can be claimed outside of pay costs)
apprenticeship levy
dividends
time not spent working directly on the project (for example sick, non-productive time or training days and maternity pay)
use of blended labour rates inclusive of overheads

These pay rates will be subject to checks during the pre-award stage to ensure that day rates reflect actual costs. High payroll costs will be challenged and evidence (such as payslips) must be provided to justify the rate is on a cost recovery basis only.

When making grant claims against labour costs, actual costs claimed must be supported with timesheets of those individuals who have worked on the project.

In the budget breakdown provided, you are asked to provide a pay cost per day. Using actual gross monthly payroll costs, please assume 260 working days in the year, less annual leave and public holiday entitlements.

Overheads

This scheme offers three options for overhead costs:

no overheads, which can be used if you are not incurring or claiming grant for your overheads.
20% of labour costs allows you to claim 20% of your labour costs as overhead. This includes both direct and indirect overhead. Selecting this option allows us to review a successful grant application much faster as no further documentation is needed
academic institutions can submit overheads as part of their 80% full economic cost, which must be supported by a copy of your most recent approved TRAC methodology or suitable evidence to verify the legitimacy of the overheads request

Full overhead recovery or full absorption costing is not eligible.

For the calculate overheads option, you must download and complete the overhead calculation spreadsheet from the overheads costs section of the application form (please see section 6.7 for further advice on completing the spreadsheet).

Low value grants

Due to the low value nature of the grants to be awarded under this call, the UK Space Agency will not consider overheads higher than 20%, as per some of our other calls.

Overheads should be stated separately from the pay costs, charged at 20%. This 20% overhead should be recorded in the overhead column in the budget breakdown, this allows you to claim 20% of your pay costs as overhead. This includes both direct and indirect overhead. The overheads relating to contingent workforce / consultants should be included within their daily rate, and not included in either the calculation of the 20% overhead allowance.

VAT Rules

Grants are not a payment for a service, they are provided without expectation of any return to the UK Space Agency. Grant funding is therefore outside the scope of VAT so you cannot charge output VAT on top of your submitted costs.

However, organisations that are not registered for VAT can include VAT incurred within their costs. Academic participants can legitimately claim irrecoverable VAT incurred as part of their costs.

Ineligible expenditure

payment that supports for lobbying or activity intended to influence or attempt to influence Parliament, government or political parties, or attempting to influence the awarding or renewal of contracts and grants, or attempting to influence legislative or regulatory action
using grant funding to petition for additional funding
input VAT reclaimable by the Grant Recipient from HMRC
payments for activities of a political or exclusively religious nature
goods or services that the Grant Recipient has a statutory duty to provide
payments reimbursed or to be reimbursed by other public or private sector grants 
contributions in kind (ie, a contribution in goods or services, as opposed to money)
depreciation, amortisation or impairment of fixed assets owned by the Grant Recipient
the acquisition or improvement of fixed assets by the Grant Recipient (unless the grant is explicitly for capital use – this will be stipulated in the Grant Offer Letter)
interest payments (including service charge payments for finance leases)
gifts to individuals
entertaining (entertaining for this purpose means anything that would be a taxable benefit to the person being entertained, according to current UK tax regulations)
statutory fines, criminal fines or penalties; or liabilities incurred before the issue of this funding agreement unless agreed in writing by UK Space Agency
employee paid benefits and bonuses
costs incurred in the preparation of the independent assurance report where required within the grant funding agreement (for grants above the value of £250,000)
alcohol

Eligible expenditure

personnel costs; researchers, technicians and other supporting staff to the extent employed on the project
costs of equipment and instruments, to the extent employed on the project
costs of buildings and land, to the extent and for the duration period used for the project
costs of conducting research and of external consultancy and contractual research or other knowledge assets, including patents bought or licensed from outside sources
travel and subsistence, subject to the requirements set out in section 6.3 below
subcontractor costs, as set out in section 6.4
workshop or laboratory usage costs (including details of how cost rates have been calculated)
training costs, where these are specific to and necessary for the project
preparation of technical reports, where these go beyond the level expected for standard project management (for example, a detailed technical report outlining the development towards a key technical milestone rather than a brief summary that documents how much time was spent achieving this)
market assessment studies
patent filing costs for new intellectual property for small and medium enterprises, who can claim a maximum of £7,500 per SME partner towards the filing costs of new IP (this does not include legal costs relating to the filing of trademarks or related expenditure, which is considered a marketing cost and therefore ineligible)
regulatory compliance costs where they can be justified and shown to be necessary to deliver the project
any other project operating costs and project overheads; including costs of materials, supplies and similar products, incurred directly as a result of the project

Travel and subsistence

You can claim reasonable travel and subsistence costs for those individuals identified in the labour tab. Costs must be necessary incurred exclusively for the progression of your project. Travel costs must be at economy and best value for money rates. You should provide details and the purpose for the expenditure, including the number of staff involved.

If for any reason these limits below cannot be adhered to (eg, to accommodate a reasonable adjustment), you must seek prior written approval from the UK Space Agency. No claims for alcohol will be accepted.

The UK Space Agency reserves the right to not settle claims which have breached these guidelines. All expenditure must be supported by actual, itemised receipts.

Limits:

accommodation (London and international destinations): £166 per night
accommodation (UK destinations excepting London): £118 per night
breakfast (UK and destinations excluding Europe and North America): £6
breakfast (Europe and North America): £12
lunch (UK and destinations excluding Europe and North America): £6
lunch (Europe and North America): £18
dinner (UK and destinations excluding Europe and North America): £18
dinner (Europe and North America): £30

Tolls, ferry costs, parking and congestion charge: Receipted costs for ferries, and tolls bridges and roads unavoidably incurred during your business journey may be claimed. Reasonable parking charges may be claimed. Receipted congestion charges unavoidably incurred on your business journey may be claimed.

These lists are not exhaustive. Applicants are advised that all budgets will be scrutinised at submission to ensure costs only include eligible expenditure, and the UK Space Agency may request updated budgets where these are necessary for an application to progress to the next stage. No application will be excluded solely on the basis of ineligible costs being included in an initial submission.

5.4 Subcontractor requirements

You can claim costs relating to work carried out by third-party organisations that are not part of the project team. This work must be essential to the success of your project, involve expertise that does not exist within the project team and involve skills that it is not practical to develop in-house for your project.

You should name the subcontractor (where known) and describe what the subcontractor will be doing and where the work will be undertaken. Their role and engagement will need to be fully justified within the application. Subcontractors should be selected through your usual procurement process.

Any work supplied by associated companies should be charged at cost and exclude any profit element. Where subcontractors are non-UK based, please justify why you are unable to use a UK alternative. Lead organisations retain responsibility for carrying out due diligence on any subcontractors.

5.5 Grant Funding Agreement requirements

The Grant Funding Agreement template is included as a separate document. Applicants must sign up to the terms as set out in the grant funding agreement.

No material changes to the terms will be considered. Minor changes may be considered if an applicant can demonstrate that agreeing to the provision within the Grant Funding Agreement would result in the applicant breaching its statutory or regulatory obligations. Grant applicants wishing to propose changes should not make changes directly to templates but engage with the call lead in advance of the call closing date and advice will be provided.

All organisations in receipt of grant funding must abide by the UK government Code of Conduct for Grant Recipients.

All projects in receipt of £250,000 or more of grant funding may be subject to an external annual audit to ensure that costs claimed from the grant funding have been expensed on agreed project related expenditure and comply to UK Space Agency grant funding policies (eg, match funding). The auditor will be appointed by the UK Space Agency. All subcontractors and partners must provide access to project relevant expenditure. Therefore, grant recipients must maintain, and be able to provide upon request, any supporting evidenced as deemed necessary, such as:

timesheets (prime and, where applicable, partners)
staff costs (contractors)
all receipts (including travel and subsistence)
all partner and subcontractor invoices
breakdown of overhead costs
breakdown of capital usage (eg, licence, data costs etc)

The UK Space Agency reserves the right to conduct ad-hoc audits throughout the life of the project.

Question 5

6.  Guidance for preparing an application

Accepted Answer

6.1. Submission overview

Only the lead organisation must submit an application. It is the lead organisations responsibility to ensure that all required information is complete and accurately submitted before the deadline.  

The decision of the UK Space Agency is final in all cases. There is no course for appeal, but we endeavour to provide feedback on all applications. Incomplete or late applications and altered templates will not be considered.

Applications for project funding must be submitted to the UK Space Agency as follows: 

Full application submitted by midday on 31 July 2024 to commercial@ukspaceagency.gov.uk with the subject “Earth Observation data capability enhancement”. This will include your application form and the following attachments:

financial information spreadsheet
National Security Questionnaire (further guidance is available in section 8)

The Grant Funding Agreement template is provided for information only and does not need to be submitted with your application

6.2 Financial information

Please provide an indication of the costs you expect to incur on the project using the template provided. These tables will be scrutinised by the UK Space Agency to ensure all costs proposed represent eligible expenditure under grant funding terms and conditions.

Please include the following information, noting the requirements set out in section 5 around eligible and ineligible expenditure:

subsidy control category tab: please include each partner organisation proposed and their relevant size, which will automatically populate their subsidy control category. Subcontractors are not included in this section and should be listed as ‘additional costs’ for the lead organisation in the work package breakdown tab
work package breakdown tab: please include a detailed breakdown of each proposed work package and the spend associated with each item. Grant funding is provided on a cost recovery basis and so no profit margins should be included on any item
proposed milestone table tab: grant funding is paid in arrears upon agreement of completed milestone deliverables. Please include details of your proposed milestone deliverables, the work packages these correspond to and how much grant funding is requested
summary by work package: this tab will automatically populate
summary by organisation: this tab will automatically populate
instruments and equipment tab: please provide details of any instruments or equipment being used for the project, whether these are being purchased specifically for it or have an operational use beyond the end of the project

Question 6

7.  Assessment of applications

Accepted Answer

Applications for this funding scheme will be assessed by the UK Space Agency.

A summary of the assessment process is below: 

only proposals received by the closing time and date will be considered 
initial sift of proposals will remove any proposals which do not meet the eligibility criteria 
eligible proposals will be scored against assessment criteria by a panel drawn from across the UK Space Agency
a moderation panel will follow to ensure consistency in marking 
a scored and ranked list of fundable proposals will be generated. This will inform the portfolio selection panel that will determine the projects to be funded 
if needed, clarifications will be sought from organisations 
all applicants will be advised of the outcome 
due diligence will be conducted throughout the call process as set out in section 8. If due diligence results in irreconcilable differences, the grant will not be placed

The assessment criteria and weightings for this scheme are as follows:

Question	Weighting
How does your proposal advance Earth Observation Data midstream capabilities?	60%
How have you ensured your project has minimised costs and identified costs are realistic?	10%
How will you ensure effective delivery of this project throughout its full duration?	10%
How will this project catalyse future investment into the UK space sector?	20%

Further guidance on the questions is provided below, including a copy of the scoring criteria. All questions are scored out of 5.

7.1 How does your proposal advance Earth Observation data midstream capabilities?

Your response should clearly identify how the proposed project will help advance your strategic capabilities in midstream Earth Observation and therefore put you in a position to build your capacity to compete for future opportunities. This should include reference to the specific midstream capabilities your project will enhance, which may include:

data acquisition
data processing
data storage
data interoperability
data assurance
data dissemination

Guidance for scoring on this question is as follows:

higher scoring responses (4-5) will reference how the grant funding will help develop new or existing operational capability or capacity and explain how this will strengthen your applications for ESA missions or future projects (eg, the ESA Copernicus Framework). They will reference wider UK Space Agency strategic objectives or government objectives (eg, net zero or levelling up) that your improved capabilities will help you address in future
moderate scoring responses (2-3) will include some references to how the grant funding will help develop new or existing operational capability or capacity, but explanations as to how this will strengthen future applications may be unclear or poorly justified
low scoring responses (0-1) will show no clear reference to how the grant funding will help develop new or existing operational capability or capacity or provide no justification for how this will strengthen applications for future missions or projects

We are particularly interested to fund bids that seek to develop existing commercially operational capability or capacity which can put UK entities in a stronger position to bid for ESA missions, including the ESA Copernicus Framework. In the event this call is oversubscribed and more fundable proposals are received than the UK Space Agency has budget to support, priority will be given to bids that focus on this area.

7.2 How have you ensured your project has minimised costs and identified costs are realistic?

The spending of grant funding should deliver value for money to the UK taxpayer, including robust financial accounting practices. Your response should set out how you have calculated your proposed project costs to ensure they represent the minimum budget required to deliver your specified project objectives, in line with grant funding requirements. You should demonstrate how the project offers good value for money and mitigated high costs. You should include, where relevant, confirmation of any quotes from suppliers or subcontractors that are included.

high scoring proposals (4-5) will include a good budget that has been clearly calculated, with strong justification as to how this has been calculated, with relevant supporting evidence from subcontractors and suppliers (eg, proforma invoices or quotes)
moderate scoring proposals (2-3) will provide some justification for the outlined costs, but some key elements will not be well explained or justified
low scoring proposals (0-1) will provide limited or no justification for cost calculations, leading to limited confidence that accurate financial controls have been implemented. Proposal does not demonstrate that the costs are the minimum required to deliver the project

7.3 How will you ensure effective delivery of this project throughout its full duration?

Projects have a greater chance of being delivered to time and budget if they are well managed throughout their delivery. This section should set out how you plan to deliver the proposed project. This should focus on your project management approach, identification and management of risks. Many space innovation projects are technically complex and involve a high degree of risk or experimentation: the UK Space Agency is looking for assurance that you have a suitably qualified team in place with the right expertise and a robust plan for delivering the project.

Your response should set out:

who will deliver the project? What are their skills and experience that make them the best people to do the work? How have key subcontractors been selected? Who is responsible for overall project management and keeping the project on track?
what are the individual work packages within the project? Who will be responsible for delivering them? How are work packages connected to each other and where are the key dependencies? What is the milestone deliverable that provides assurance the work has been completed to the required standard?
what are the key risks to the project? Who will be responsible for managing them and how will they be managed?

This section should include a Gantt chart or similar diagram to set out the proposed schedule with each work package shown, a breakdown of each work package with key milestone deliverables and a risk register. Given the scale of the grant funding available, we would expect to see between one and four milestones proposed.

high scoring proposals (4-5) will show good evidence of a robust approach to project management that gives confidence in successful project delivery. Documents are thorough, well thought out and well justified. The identified team is of the appropriate level of experience to deliver the project. The risk register will show consideration of key project, financial, resource and technical risks with appropriate mitigations set out. The structure of the work packages is clear and there are appropriate levels of resource assigned to them
moderate scoring proposals (2-3) will show some evidence of a robust approach to project management, but with some questions around the overall deliverability of the project. Documents may be thorough but there is limited evidence shown that an appropriately skilled and experienced team is in place to manage a project of the scope/complexity proposed. There is limited consideration of risks or key documentation (project schedule/risk register) is missing
low scoring proposals (0-1) will provide insufficient evidence to give confidence in project delivery. There will be deficiencies identified within the project management approach or technical capabilities that are likely to lead to issues in project delivery. Key documents will be missing or incomplete (project schedule/risk register)

7.4. How will this project catalyse future investment in the UK space sector?

The UK Space Agency seeks to ensure that the investment it makes delivers a strong return and supports the space sector’s future growth. This section should set out the potential your proposed project has to attract additional investment or funding from external sources beyond the life of the grant, and how your enhanced capabilities will help you access new commercial opportunities that would otherwise not be available. You should include information on any partnerships or collaborations established that could leverage additional resources or support and set out how the project will create growth within the UK space industry ecosystem. You should include any estimates or assumptions of future growth arising from the grant and set out how these have been calculated.

high scoring proposals (4-5) will provide excellent, detailed evidence of the benefits that government funding will enable them to achieve and the impact on the UK economy, including prospects for future revenue opportunities. There will be a well-justified quantitative assessment of the scale of additional revenue or investment unlocked by pursuing the project (or assumptions to be tested and developed within the project)
moderate scoring proposals (2-3) will provide some evidence of the benefits or investment opportunities that the project could unlock, but these may be unrealistic in some areas. No or limited quantitative assessment or assumptions to be tested provided
low scoring proposals (0-1) will provide no or limited evidence of the benefits and future investment opportunities, or estimates are unrealistic and unlikely to be achieved. No quantitative estimates undertaken or assumptions to be tested within the project

Question 7

8.  National Security Questionnaire

Accepted Answer

The threat to space is real and coming increasingly closer to the UK space industry as attempted breaches have demonstrated. Everyone needs to protect assets and services from adversaries, incorporating Secure by Design principles as projects, processes and systems are developed. Demonstrating a commitment to security is critical to the ongoing success of any business. Ensuring secure, robust and recoverable services and services can provide a competitive advantage in the marketplace and avoids unnecessary costly retrofitting.

The UK Space Agency works with the space industry to improve security and resilience to attack. As part of the requirements for this scheme, applicants must:

complete the National Security Questionnaire and return with your application documentation by the deadline set out in this guidance (please note that project partners are not required to complete this, only the lead organisation)
apply for a free login for the UK Space Agency security extranet (called Resilience Direct, find out more in the national security annex attachment) to obtain security alerts and other communications and access guidance and other useful information tailored for the space sector
successful applicants will be engaged at the pre-award stage by the UK Space Agency National Security team. All successful grant recipients must undertake measures that are appropriate and proportionate for the purposes of reducing the risks of security compromises occurring and preparing for the occurrence of security compromises
successful grant recipients must provide a mitigation, response and recovery plan within 6 months of a Grant Funding Agreement being signed to resilience@ukspaceagency.gov.uk. Plans should include an annex or separate plan (proportionate to the company/project size and level of risk) detailing specific activity planned in response to a cyber security attack. Further guidance on plans is available on the Resilience Direct secure extranet and the National Cyber Security Centre website.

Question 8

9.  Due diligence

Accepted Answer

The UK Space Agency will carry out due diligence on grant applications as required using internal and, where necessary, external subject matter experts. The scope and degree of due diligence will be determined by the value, nature and complexity of the grant scheme. All applications will be subject to basic checks such as credit reports and Companies House checks.

Additional pre-award due diligence may include, but is not limited to:

technical assessment of the proposed project: including technical viability and sustainability
financial assessment of organisation financial standing/health, assessment of project costs, aid intensity values and match funding contributions (including any subsidy control requirements and cumulation thresholds)
economic impact or value for money assessment
commercial: viability and/or commercial sustainability of the proposed solution, market position, demand and/or interest in technology, terms of the grant funding agreement
programmatic: alignment to aims and objectives of the programme, programme plan which demonstrates the project can be delivered within the funding period and the critical path, risks and issues, details on project partners and/or subcontractors

Post-award due diligence may include, but is not limited to:

technical assessment of milestone deliverables against acceptance criteria to allow milestone payments to be released
financial: assessment of expenditure for each milestone payment and reporting on planned costs, follow up review of financial standing/health if it is a multi-year project
commercial: change management including any variations to time, cost, scope, or GFA terms; review of milestone deliverables as required
programmatic: project progress and impacts of any delays, risk assessment and mitigation activity
end of project review: Has the technical and economic value been realised? Lessons learned and continuous improvement. Have there been any changes to the organisation since the grant award?
UK Space Agency commissioned and funded financial audit of Grant Recipient, and if applicable project partner, costs

Grant applicants who opt to work with project partners (entities involved in delivery of the project under a flow down agreement rather than a subcontractor) will assume all responsibility for partner due diligence.

Applicants will need to demonstrate they have carried out a sufficient level of due diligence with regard to their proposed project partners and subcontractors. Applicants will need to demonstrate they have carried out minimum checks at proposal stage, which may require further scrutiny if the proposal is to be funded.

To meet this requirement, applicants can provide evidence of due diligence carried out supported by the resulting information or submit a partner reasonable assurance statement. The evidence should be consistent with the checks that we would conduct on our Grant Recipients, for example, financial standing, technical ability and scrutiny of the breakdown of costs. Any costs associated with project partner due diligence is considered a bidding cost and is to be borne by the applicant.

Applicants must provide evidence that they, and project partners have in place of appropriate anti-bribery and anti-corruption internal policies, and a process for declaring and managing conflicts of interest. 

Question 9

10.  Confidentiality

Accepted Answer

The procedure for handling and assessing the applications for project funding will be as follows: 

completed applications must be submitted to the UK Space Agency at the email address specified in the guidance documentation. All bids will be held in confidence 
once the call closing date has passed, electronic copies of all eligible documents will be distributed to the independent assessment panel members. UK Space Agency confidentiality rules will apply 
for those bids not recommended by the panel for funding, documentation will be retained by the UK Space Agency for reference. The proposals will not be visible to any others, and the names of any unsuccessful bidders will not be published
information submitted for those projects selected for funding will be retained by UK Space Agency but remain confidential 
summary information about the projects selected for funding may be published on the UK Space Agency website

The UK Space Agency will monitor the funded project through project reports and the submission of project deliverables. The Agency requests that any confidential information is clearly marked Commercial in Confidence. 

Question 10

Annex 1: Subsidy control

Accepted Answer

This annex provides supplementary information about the UK Space Agency’s obligations under the Subsidy Control Act 2022 and related agreements.

The UK Space Agency supports organisations to invest in research, development and innovation. The support we provide is consistent with the UK’s international obligations and commitments to Subsidy Control. These include:

World Trade Organisation rules
The EU-UK Trade and Cooperation Agreement (TCA), see (EU-UK TCA summary and Department for Business and Trade Guidance)
In certain circumstances (eg, under the Northern Ireland Protocol), EU State Aid Regulations may also be applied
Other bilateral UK Free Trade Agreements where relevant
Subsidy Control Act 2022

What is a subsidy?

For the purposes of UK international commitments, a subsidy is a measure which:

is given by a public authority. This can be any level; central, devolved, regional or local government or a public body.
makes a contribution (this could be a financial or an in-kind contribution) to an enterprise, conferring an economic advantage that is not available on market terms. Examples of a contribution are grants, loans at below market rate or a loan guarantee at below market rate or allowing a company to use publicly owned office space rent free. An enterprise is anyone who puts goods or services on a market. An enterprise could be a government department or charity if they are acting commercially.
affects international trade. This can be trade with any World Trade Organisation member or, more specifically, between the UK and a country with whom it has a Free Trade Agreement. For example, if the subsidy is going towards a good which is traded between the UK and the EU, this could affect trade between the EU and the UK. It is not necessary to consider whether the subsidy could harm trade, just whether there could be some sort of effect. Subsidies to very local companies are unlikely to be a problem as this is unlikely to affect international trade

The Subsidy Control regime (or where relevant EU State Aid Regulations) are designed to prevent unfair advantages and distortion of trade. Read further information on complying with the UK’s international obligations on Subsidy Control. More information on the principles of awarding subsidies can be found in the Department for Business and Trade.

Subsidy principles

Before awarding subsides, the UK Space Agency must ensure that the subsidy scheme meets the principles as determined in the Subsidy Control Act 2022. There are that:

subsidies should pursue a specific public policy objective to remedy an identified market failure or to address an equity rationale such as local or regional disadvantage, social difficulties, or distributional concerns (“the objective”)
subsidies should be proportionate to their specific policy objective and limited to what is necessary to achieve the objective
subsidies should be designed to bring about a change of economic behaviour of the beneficiary that is conducive to achieving the objective and that would not be achieved in the absence of subsidies being provided
subsidies should not normally compensate for the costs the beneficiary would have funded in the absence of any subsidy
subsidies should be an appropriate policy instrument to achieve a public policy objective and that objective cannot be achieved through other less distortive means
subsidies’ positive contributions to achieving the objective should outweigh any negative effects, in particular the negative effects on trade or investment between the parties
subsidies should be designed to achieve their specific policy objective while minimising any negative effects on competition or investment within the United Kingdom

To ensure our funding schemes provide funding in line with the UK’s obligations and commitments to subsidy control, the intervention rates detailed within the call guidance shall apply unless the applicant seeks to claim exemption under the Minimum Financial Assistance Allowance (previously known as de-minimis under State Aid and Small Amounts of Financial Assistance under Trade and Co-operation Agreement) rules.

Disclaimer

This guidance is not a substitute for taking independent legal advice on your eligibility status, before applying for funding. Every applicant is responsible for securing their own independent legal advice to ensure they are lawfully eligible.

Please note the UK Space Agency is unable to award organisations that are considered to be ailing and insolvent companies. We will conduct financial viability and eligibility tests to confirm this is not the case following the application stage.

If you see an error in this guidance email Commercial@ukspaceagency.gov.uk.

Question 11

Annex 2: Q&A

Accepted Answer

Can I resubmit a proposal that was rejected in a previous call?

Yes, you may re-submit your proposal which will then go through the independent evaluation process when being considered for funding. We recommend that any previous feedback is taken into consideration.

Do the match funding funds have to be immediately available when applying for funding?

Yes, the PV funding must have been agreed and secured at the time of applying for the grant so that the project can commence as soon as the grant agreement has been completed.

Can the UK Space Agency provide advice about any type of collaboration/partnership programme that the Agency is promoting?

The Agency does not promote any particular collaboration although collaboration in essence is encouraged in projects.

Can a non-UK based organisation receive funding?

The UK must lead the consortium. A non-UK based organisation cannot receive national funding as the primary focus of UK Space Agency is on the growth of the UK sector; therefore, any monies awarded cannot go outside the UK to a partner body. If the proposed non-UK capability is essential the work can be subcontracted out, however the proposal must demonstrate clearly that this resource is not available in the UK.

In such instances the subcontractor cannot be a partner to the project. However, if a non-UK entity wants to be a partner in the project that is acceptable. This can be facilitated by the non-UK entity organisation providing PV or capability as contribution-in-kind.

What format will the grant agreement take for any funded proposals, and can I adapt this to suit my proposal?

We have provided a copy of our standard Grant Funding Agreement. This is the document that will be used as the formal mechanism for any successful bidders to receive grant funding. Applicants are required to accept the main terms of this grant funding agreement when submitting your application.

Applicants requesting changes to the agreement are required to submit a marked-up copy of the published grant funding agreement setting out the proposed variations, along with a justification for any amendment to the standard grant funding agreement terms. Please be aware that the UK Space Agency will only consider variations which are requested where the applicant would be in breach of legal requirements or statutory regulations by complying with the clause, or series of clauses.

Should we explicitly state the overhead rate attached to salary costs, or would you prefer it to be amalgamated into a combined salary/overhead cost for each staff position?

The finance template includes notes on what information is required.

Do labour costs relate only to staff on a PAYE payroll or would staff employed on short/long-term fixed contracts be eligible?

Costs should be applied for any staff that will be part of the project team/work regardless of employment status within the organisation. However, any costs for project work done by sub-contractors must be declared as a separate cost to the project. Sub-contractors cannot be partners to the project and justification in the proposal would need to be clearly stated as to the requirement for use of sub-contractors.

Are referees required to be within the UK?

Referees do not have to be UK specific but must be from recognised international organisations and/or from other known space institutions.

Does the organisational background information apply only to the lead organisation?

No. All proposals must include organisational background information for all those involved, therefore including those put forward in collaboration.

Is there a difference between a partner and a sub-contractor?

Yes. If you are collaborating with another organisation or company, then they are your project partner and will be included in your proposal as subject to PV contribution.

If you wish to sub-contract some work, then that company cannot be considered as a project partner as payment to them will be made from the award and they will therefore be included in the costs of the project.

Would sub-contractors have any IP publication rights?

If you sub-contract work this may not affect the IP publication rights of your company, but this is for the lead organisation to confirm.

Does the maximum grant award offered include the PV contribution?

The maximum grant is the award value the UK Space Agency will give to a successful proposal. However, to industrial organisations (eg, SME/LE) and FEC to not-for-profit organisations/academia. Therefore, your equivalent PV contribution must match that criterion.

Is an independent audit required of the total cost of the project?

Confirmation is required that the grant recipient has expended the sums in respect of the period in which milestone payments have been claimed. For this purpose, a report must be completed and sent to the grant funder within 3 months of the end of the grant or annually, whichever is shorter. As per the terms of the Grant Funding Agreement, it is not possible to claim the cost of this report.

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1. Introduction

2. Call objectives, scope and key information