Guidance

Claims Process for Grant Recipients

Updated 21 February 2023

Version 9.3

Published 21 February 2023

1. Introduction

This guidance should be read in conjunction with the terms and conditions set out in your European Structural and Investment Funds (ESIF) Funding Agreement (FA) including the projects approved final full application for ESIF funding. These documents set out the eligible parameters, scope of activities and the key deliverables that are to be reported to the Managing Authority (MA).^{[footnote 1]}

For the Grant Recipient (GR) to report on delivery and draw down European Social Fund (ESF) Grant Funding in line with the terms and conditions set out in the FA, an application for reimbursement ‘Grant Claim’ must be made.

All Claims should be submitted via ECLAIMS (Electronic Claims and Information Management System).

Before any payments can be processed the GR must have completed and returned a fully accurate ‘Bank Details Form’ to the ESF MA. A blank form will be sent to the GR with their new FA and, once accurately completed and returned, this will allow the MA to enable actual payment.

A Project Inception Visit (PIV) must also have taken place prior to submission of your first claim and, following this visit, the ESF MA should have confirmed in writing, usually via email, that the GR is cleared to start submitting financial claims.

The GR must ensure from the outset that robust and suitable systems and processes are in place locally to maintain adequate audit trails and manage information effectively and efficiently. All project information must be retained and made available for verification or any audit visits throughout delivery and post completion under the retention of documentation requirements in accordance with the European Social Fund document retention guidance and the ESF National Eligibility Rules and Programme Guidance.

Unless agreed otherwise with the ESF MA, the first submitted claim should include all spend or activity undertaken on the project up to and including the current Claim Instalment Period. The GR must ensure that any expenditure included in the first claim meets the relevant defrayal rules set out in this guidance.

Your ESF Contract Manager (CM) will contact you regarding the Final Claim process up to 6 months prior to any final Claim.

2. Timing

Claims must be submitted to the ESF MA in arrears, via ECLAIMS, reporting on a pre-defined period of actual activity. This is referred to as the Claim Instalment Period.

Claim Instalment Periods are confirmed within the project specific conditions contained within the FA; these are based on calendar quarters as detailed below

• quarter 1, 1 January – 31 March
• quarter 2, 1 April – 30 June
• quarter 3, 1 July – 30 September
• quarter 4, 1 October – 31 December

Claims are determined by the Claims Schedule set for the project, and Claims (including ‘Nil Claims’) should be started in chronological order – GR cannot start a new Claim on ECLAIMS until the Claim for the previous Claim Period has been started.

Claims must be submitted to the MA within 25 working days of the end of each Claim Instalment Period.

The MA will aim to finalise payment into the GR’s Bank Account within 30 working days from the point at which all claim information is agreed by the ESF MA as correct and complete, including the conclusion of any desk-based evidence checks (that is, there are no outstanding issues, actions or concerns that could potentially lead to an Irregularity).

2.1 Late or missing claims

GR’s must notify the MA promptly if at any time they become aware that they are unable to make a Grant Claim in accordance with the outlined timescales or in accordance with the expenditure profile.

Under the terms and conditions set out in their FA, GR’s are required to make Grant Claims within 25 working days of the end of the Instalment Period for which the Grant Claim is due. Failure to comply with this condition is an event of default under their FA and could therefore lead to the Department enacting its rights to suspend, reduce or cease to make payments in respect of the relevant ESF Project.

For this reason, the GR’s should ensure prompt submission of Claims in line with their contracted Claim Schedule.

2.2 Final Claim

GR’s must submit their final claim no later than 25 working days after the end of the Claim Instalment Period in which the Financial Completion Date falls. The 25 working day deadline is currently set to be 5th February 2024.

The final claim can be submitted as soon as possible following your project financial completion date, as detailed in your Funding Agreement. On submission, the final claim must be full and complete in line with Funding Agreement conditions.

No late claims will be accepted by the MA, no late claim action will be undertaken and there will be no exceptions.

GR’s also need to consider and will be asked by the MA, to demonstrate how they will resource not only the claim submission but also subsequent related activities during 2024 and beyond. This will include ensuring appropriate staff are available and have the correct access on ECLAIMS to undertake the activity required.

3. Claim process

The claim process is an integral part of the contract management and control environment employed by the MA in managing the Programme. Although Claims are a mechanism for GR’s to draw down their ESIF Grant it also provides key information on project progress and performance. Full and comprehensive information enables the MA to obtain assurances and carry out Desk Based Verification on the validity of the activities currently undertaken and the on-going project delivery.

For Technical Assistance projects this guide, should be used alongside the guidance in Action Note 048/20 New ESF Flat Rate Simplified Cost Option methodology and associated claims process for ESF Technical Assistance projects published on GOV.UK.

All claims should be submitted to the MA via ECLAIMS. The following documentation should be uploaded as supporting documentation.

• ESF Transaction List
• ESF Participant Data Schema (not application to Investment Priority 2.2 and Priority Axis 3 outputs or results)

Each project must also submit a narrative Progress Report with their quarterly claim. The Progress Report information should be recorded directly into the relevant screen(s) and fields in ECLAIMS.

By exception, subject to agreement with their CM, a project may be allowed to provide their report via a separate document which must then be uploaded into ECLAIMS.

However, GR’s should note that they will still need to work through the Progress Report screens in ECLAIMS in these circumstances before attaching their narrative report otherwise ECLAIMS will not allow submission of the claim.

Regardless of whether they choose direct input, or a separate document, the GR must ensure all required Progress Report sections or topics as set out in the ECLAIMS Progress Report screens are fully covered.

For guidance on completing see ESF Progress Report

Projects who are delivering activities under Investment Priority 2.2 must report progress against their Output and Result profiles in their Progress Report. This should include numerical performance against profiles, as well as any specific narrative progress update. ESF Technical Assistance projects should also report progress against their specific ESF output and result indicators in each of their quarterly Progress Reports.

All Investment Priority (IP) 2.2 Projects are required to complete an IP 2.2 Claim Form which should be uploaded to ECLAIMS. Follow this link to the

ESF claim applications and Self-Declared Adjustments on GOV.UK

The CM may also ask the project to upload an additional project specific return with each claim.

For example, Community Led Local Development (CLLD) projects must upload a CLLD Management Information (MI) sheet which provides details of pipeline activity at Local Grant Recipients (LGR) level, reports on the 25% M and A threshold.

As part of the PIV process, GR’s should have already identified staff to perform the ‘Claim Editor’ role in ECLAIMS – bearing in mind that financial claims can only be generated and submitted in ECLAIMS by individuals who have been assigned the ‘Claim Editor’ user role, including uploading of any supporting documents.

GR’s must ensure that the final compiled claim is checked by a Claim Reviewer in their organisation prior to submission of the claim via ECLAIMS. The Claim Reviewer must be an individual who has been named as an Authorised Signatory on the project’s Bank Details previously submitted to the MA and they must record their action in ECLAIMS.

If a GR submits a claim without Claim Reviewer action recorded in ECLAIMS, or if the Claim Reviewer is not a recognised Authorised Signatory for the project, the claim will be rejected by the MA and returned to the GR for remedial action.

Claims are to be submitted in arrears for each Instalment Period and only eligible expenditure defrayed (incurred and ‘paid’, for example cleared bank account) by the end of that period can be included in the Claim for reimbursement. It is acceptable to include expenditure defrayed in previous periods in the Claim, if they have not already been included in another Claim and a statement has been included in the expenditure description field confirming this.

At the point each Claim is submitted to the MA on ECLAIMS, the GR must notify their ESF CM via email, to ensure timely action can be completed to check the information provided, request desk-based evidence where applicable and authorise and approve the resulting payment.

The GR must notify the MA promptly if at any time it becomes aware that it is unable to make a Grant Claim in accordance with the outlined timescales or in accordance with the expenditure profile.

In the event that no expenditure has been defrayed during the Instalment Period a Nil Claim must still be submitted. Once a Project has been invited by the MA to make their first financial Claim, all Claims thereafter – including Nil Claims – must include a Progress Report.

Progress Reports provide details of progress towards delivery and achievement of the project objectives or activities, expenditure forecast and Outputs and Results forecast.

If at any stage, the GR identifies any mistakes or omissions in any of its Claims, whether paid or in the process of being paid, they should contact their CM as soon as possible.

Where clerical and or technical errors are identified on Claims that have already been paid, GRs will need to contact their CM.

4. Financial information

This section is aimed to guide you through the key areas to check when collating the detail for your Claim.

All expenditure which is to be claimed must:

• fall within the agreed scope of the project activities and within the agreed expenditure categories defined in the financial tables within the FA.

• conform to all respects of the eligibility criteria as set out in the ESF National Eligibility Rules and Programme Guidance .

• be defrayed (incurred and paid for example, cleared the applicant’s bank account) by the end date of the Claim Instalment Period. The date paid is the date the payment appears on your bank statement. For large organisations, the Bankers Automated Clearing Services (BACS) defrayal date may be acceptable, this should be discussed with the MA.

• only include ‘Flat Rate’ costs of either 15% or 40% as outlined in your FA; this will have been formally agreed during the appraisal process.

• only include Irrecoverable Value Added Tax (VAT) if this has been agreed as an eligible cost with the MA during the Full Appraisal process.

• be able to be backed up by a full audit trail containing all original source documentation from receipted invoices to bank statements and accounting documents of equivalent verifiable value. These need to be maintained and made available for verification checks and audits. These documents must be retained in accordance with European Social Fund document retention guidance and the ESF National Eligibility Rules and Programme Guidance

5. Transactions list

A Transaction List, itemising each item of expenditure, must be uploaded directly into ECLAIMS to support each Claim. This Transaction List must provide the MA, or any other audit body, with clear detail relating to all the costs being claimed. It is important that this information is entered accurately and provides a clear description of the costs to enable the reader to determine their eligibility. The use of acronyms and jargon should be avoided to aid clarity to the reader.

The Transaction List spread sheet contains three tabs entitled Guidance, Transactions and Summary. The Transaction List is designed to enable upload to ECLAIMS.

It is strongly recommended that the ‘Guidance’ tab is consulted before attempting to populate the Transactions tab. If at any time you are unsure of the level of detail required after checking with guidance, please check with your CM before uploading.

The details required when completing the Transaction List screen in ECLAIMS are explained below along with descriptions on whether these are mandatory fields, and what they are validated against.

Note:

a) the fields labelled as mandatory below are those which will automatically be validated by ECLAIMS and if they are not completed accurately, the Claim will be rejected

b) for data collection purposes all fields must be completed where possible regardless of whether they are labelled as mandatory or not

c) all monetary figures must be to 2 decimal places; .005 and above, rounded to .01; .004 and below, rounded to .00

d) dates should be added in with slashes (for example, DD/MM/YYYY) as ECLAIMS will not accept full-stops, and will automatically change to YYYY-MM-DD when the ‘Export’ button is pressed

e) once the Transaction List has been completed the ‘Export’ button will need to be pressed prior to submission to ECLAIMS. This button creates a spreadsheet which is in a format that ECLAIMS can accept meaning, without macros or any other formatting

For instructions on uploading the Transaction List please refer to the ESF ECLAIMS External Users Guidance.

5.1 Cost category

(Mandatory) Select the eligible cost as agreed and set out in your grant FA.

The headings you must select from are:

• ESF – direct staff costs
• ESF – other direct costs
• Youth Employment Initiative (YEI) – direct staff costs
• YEI – other direct costs

Note: Do not use the cost categories of ‘Match-direct staff costs’ or ‘Match-other direct costs’. ESF and associated Match costs must be entered as a total combined cost under the ‘ESF Direct Staff Costs’ and, if applicable the ‘ESF Other Direct Costs’ cost category. This is because the MA and ECLAIMS will automatically calculate the percentage of Match funding for each claim based on the intervention rate for your ESF Project. The final payment for your claim will then be based on that same intervention rate.

For example:

• for an ESF project, the GR should complete one line which must include both the amount of ESF and Match claimed. The MA will pay Claims at the intervention rate applicable to your project as detailed in the financial annex within your FA
• for a YEI project, the GR should complete the Transaction List with two lines for each cost. Line one being YEI, then on line two enter the ESF and Match combined. The MA will split the amount claimed (on line two) based on the intervention rate applicable to your project as above and the YEI line will be paid at 100%, as detailed in the financial annex within your FA

The following cost categories do not apply to Direct Bid projects and must not be used:

• ESF – CFO Admin
• ESF – Contract Costs
• Match – Contract Costs

Delivery Partner

(Mandatory) If your project has Delivery Partners, you must insert the Identification (ID) number applicable to that Delivery Partner in column C of the Transaction List. You must record this value in Column C against all transaction lines relating to that partner. If your project has no delivery partners, please enter a ‘0’ into column C on each transaction line.

You can find the correct ID number for each of your Delivery Partners in ECLAIMS by visiting the Full Application option from the left-hand menu on your project screen in ECLAIMS and scrolling down to the Delivery Partner table.

If you have an existing Delivery Partner and their information is not recorded in the Delivery Partner table in ECLAIMS, you will need to add their information to the table before you can include them in your financial claim.

If you have a new Delivery Partner, you must submit a Project Change Request (PCR) to the MA first for approval, before including them in the Delivery Partner table and any Financial Claims.

Priority Axis

(Mandatory) Select the applicable Priority Axis as agreed and specified in your grant FA.

5.2 Investment Priority

(Mandatory) Select the applicable Investment Priority as agreed and specified in your grant FA.

Note: For YEI Claims you must select Investment Priority 1.3a for the YEI portion of your expenditure for each financial transaction and Investment Priority 1.3b for the Match and or ESF element, failing to do so will result in your payment being incorrect.

Procurement contract ID

(Mandatory) If a transaction line is as a result of Procurement undertaken by your project, you should record the relevant Procurement Record ID number in Column F in each case. The Procurement Record ID number can be found in the Procurement Register for your ESF project on ECLAIMS.

If the transaction line is not a result of procurement by your project, then please leave column F blank.

Supplier name

(Mandatory – in any format) Enter the name of supplier, creditor or payee or employee.

Supplier VAT number

Enter the supplier VAT number.

Invoice reference

(Mandatory – in any format) Invoice or receipt or reference number. All documents should be given a separate unique reference number to clearly identify the item of expenditure for audit purposes.

Invoice date

(Mandatory) Date of the invoice or if a salary cost, the date posted on your accounting system. Dates should be added with slashes (for example, DD/MM/YYYY) as ECLAIMS will not accept full-stops and will automatically change to YYYY-MM-DD when the ‘Export’ button is pressed.

Defrayal date

(Mandatory) Date the money was defrayed or paid. (For large organisations the BACS defrayal date maybe acceptable and should be discussed with the MA). Dates can be added in using slashes – as ECLAIMS will not accept full stops – and will automatically change to YYYY-MM-DD when the ‘Export’ button is pressed.

If organisations pay their National Insurance (NI) and pension contributions monthly, it can be automatically accepted that these will be paid and that the relevant defrayal date is the date the payroll is paid. This approach is used for Article 125 testing.

For Petty Cash transactions, the defrayal date should be the date money from the Petty Cash account box was paid to an individual or supplier such as, align with the date the individual or supplier recipient signed to say they had received money from the Petty Cash.

Defrayal method

(Mandatory) Select from the drop-down the method of payment, such as, BACS, Cheque, and Credit Card.

Defrayal reference

(Mandatory) Enter payment reference relevant to transaction.

Expenditure description

(Mandatory) Full description of the item of expenditure being claimed to ensure clarity for any reader of what is being included (see additional details below for more assistance). Connections between defrayal, invoice dates and salary paid dates should be explained, that is, if they are the same date, for example, if an employee works full-time on ESF, include this in the description.

Note: If the expense relates to a participant, the unique participant identifier must be included within the expenditure description. This ensures that, if there are any issues with this participant on the Participant Data Schema (PDS), it will be possible to identify and rectify any related expenditure where needed. The participant’s name must not be used.

Apportionment details

Indicate how the eligible value is derived from the original invoice or receipt value such as, the method of apportionment, ineligible costs removed.

If a cost is apportioned between ESF, Match and or YEI, more than one Category of Region and/or more than one Investment Priority, you must include details here of how the cost has been apportioned in each case.

Total Invoice Value (excluding VAT)

(Mandatory) Indicate the total Net expenditure value of the invoice or receipt (total documented value excluding VAT).

If a cost is apportioned between ESF, Match and or Youth Employment Initiative (YEI), more than one Category of Region and or more than one Investment Priority, the Total Invoice Value must still be completed with the actual, total overall amount of the invoice. The ‘Total Eligible Value’ field will then be the place where you will need to record the actual expenditure amount to be claimed after any apportionment has been taken into account.

Total Irrecoverable VAT

State the Irrecoverable VAT value which cannot be recovered from another source HM Revenue and Customs (HMRC) of the invoice or receipt following any adjustments for apportionments or ineligible costs.

Note: If you are VAT registered and are able to recover VAT but are choosing not to do so, these costs still cannot be included in your Claim. Only record irrecoverable VAT in this field if you are claiming it back through ESF.

Total Eligible Value

(Mandatory) Enter the project eligible expenditure amount after any apportionment or adjustments have been applied and Irrecoverable VAT added in. This is the expenditure value minus adjustments against which ESF is being claimed.

Eligible for Flat Rate Indirect Costs (FRIC)

(Mandatory) Select ‘Yes’ or ‘No’ from drop-down menu. Leaving this blank will fail validation This heading is used when using either the 15% or 40% Simplified Cost Option.

FRIC costs are calculated at the relevant, agreed percentage based on the ESF Direct Staff Costs for your project but you do not need to calculate this yourself.

The Transaction List template includes an automatic calculation of FRIC costs and this auto-calculation will be reflected in the ‘Summary’ tab. ECLAIMS will also automatically calculate the FRIC costs from your uploaded Transaction List.

As these costs are automatically calculated, you must not include FRIC costs as an expenditure line in your actual Transaction List.

Total Category of Region (CoR) Expenditure

(Mandatory – if Claim covers more than one CoR) – applicable to the project will have been agreed at appraisal together with the Intervention Rate for each category. If you have only one CoR you do not need to enter data into cells T, U and V.

Note: If you have more than one CoR and your FA was agreed prior to 09/03/2017, you will need to contact your CM to obtain this information.

Descriptions of Defrayed Expenditure

The item for which funding is being claimed must have a clear description. The description must be detailed enough to allow the MA to consider its validity without the need to see the actual evidence at this stage.

The table below provides guidance on acceptable or unacceptable expenditure descriptions and level of detail required.

Note: This is for illustrative purposes only and it is not an exhaustive list

Unacceptable Description	Acceptable Description
Room hire	Room hired for [state purpose and with whom] on [date] at [place]
Catering	Catering charge for [state purpose] on [date] at [place]
Salary	Salary for [state at least one of name or post or payroll number] for period dd/mm/yy to dd/mm/yy. The description should also include whether the staff member is working all or part of their time on the project. If working part of their time, the description must include the number of hours worked and the hourly rate or ‘Fixed Percentage’ figure used so the MA can see how the total amount being claimed for that individual has been determined.
Salaries	Salaries for project management or delivery team for period dd/mm/yy to dd/mm/yy. (A complete breakdown of the evidence supporting each salary cost – identifying the post holders or employees claimed should be retained for Audit purposes)
Expenses	Expenses for [name] covering period dd/mm/yy to dd/mm/yy [type of expense for example, mileage, parking, subsistence, claim reference number if applicable]
Equipment or Materials	Purchase of [name or short description of item of equipment or materials] received on dd/mm/yy, as shown in the FA.
Mobile charges	Mobile phone rental or call charges for [name of person] covering period dd/mm/yy to dd/mm/yy
Rent	Rent charged for [identify premises (only applicable if direct cost) charged] to cover period dd/mm/yy to dd/mm/yy

Credit notes

Where your project receives a credit note from a partner or supplier but that expenditure has already been included and paid in a previous ESF claim, you should raise a Self-Declared Adjustment (SDA) for the full value of the credit note.

If you then incur further costs with the same supplier or partner against your Project and want to use the credit note as payment or part-payment of those costs you should complete the following steps:

1. record the full value of the new expenditure or invoice in your Transaction List
2. ensure the description of the transaction explains how much of the invoice or expenditure is being paid via credit note
3. ensure you retain a copy of the credit note, and evidence of the supplier or partner acceptance of the credit note as payment or part-payment as evidence of defrayal
4. if requested as part of the Desk-Based Evidence Checks (DBEC), On The Spot Visits (OTSV) or Audit Authority (AA) checks, you will need to provide the credit note as evidence of defrayal

If your Project received a credit note from a partner or supplier for expenditure which has not yet been included in an ESF claim, the amount of any expenditure being claimed from the ESF MA against that supplier or partner for the activities covered by the credit note should be reduced by the value of the credit note. This is because expenditure covered by a credit note is not ‘defrayed’ until the credit note has been spent with the relevant partner or supplier.

Evidencing Petty Cash Defrayal

As per the published ESF National Eligibility Rules and Programme Guidance, items in claims which include petty cash transactions must be capable of being tracked back to individual items claimed and related evidence in the petty cash system. The MA will need to be able to see the defrayal between the organisations bank account and the petty cash account (that is how and from what source the petty cash account is routinely replenished) and would need to reconcile the petty cash operation to the bank account.

If a Transaction Line is selected for Desk-Based Evidence Check and this expenditure has been funded via an ESF Project’s Petty Cash arrangements, you must provide the following evidence chain and upload all into ECLAIMS:

• evidence of funds being debited from the GR or Delivery Partner Bank Account to put into their Petty Cash fund for example, Bank Statement
• evidence of the funds being added to the Petty Cash fund such as a Petty Cash Logbook
• evidence of the funding for the specific Transaction Line being withdrawn from the Petty Cash in order to pay an individual or supplier as per the listed transaction for example, Petty Cash Logbook
• evidence of the individual or supplier confirming receipt of the relevant Petty Cash funds for the expenditure listed in the Transaction Line

For example:

• bank statement showing withdrawal of funds from bank account on 1/12/2018
• Petty Cash Logbook showing funds being added to the Petty Cash box on 1/12/18
• Petty Cash Logbook showing money being withdrawn from the fund on 21/1/19 to pay XX individual for a travel ticket listed as a line on the ESF Claim Transaction List
• signed receipt from XX individual confirming they received XX amount of cash on 21/1/19 as reimbursement for the travel ticket listed as the line on the ESF Claim Transaction List

Please note: in this case the travel ticket would also need to be uploaded to ECLAIMS as an item of evidence, in line with the usual travel ticket or expenses evidence requirements.

Internal Cost Transfers

If your organisation uses Internal Cost Transfers as part of your payment processes for ESF costs, you should be aware that evidence of the Internal Cost Transfer itself is not sufficient evidence of defrayal of those ESF project costs.

In the situation of an ESF project operating as a separate entity within a wider organisation (for example an ESF project within a Local Authority) and the ESF Project pays an additional direct cost to the wider organisation via internal cost transfer, there must be a process in place and a clear audit trail showing

• the transfer of funds between the ESF Project and the wider organisation receiving those funds,
• evidence of the same, actual costs being incurred, for example defrayed by the wider organisation who is receiving payment from the ESF Project to a third party

If the payment is made by an internal cost transfer and there is no supporting evidence as outlined above, the evidence of the internal cost transfer alone is not sufficient evidence of defrayal. Any expenditure should be removed from the claim unless the required defrayal evidence can be provided.

An example of a compliant audit trail for internal cost transfers could be as follows:

• evidence of an invoice or request for payment from a parent organisation to the ESF project, setting out the specific, direct costs to be paid by the ESF Project and what services/goods have been provided by the parent organisation to the ESF Project
• evidence of the ESF Project transferring the relevant direct costs amount to the parent organisation such as, financial journal entry, cost centre transfer record
• evidence of the direct, actual costs incurred by the parent organisation and evidence they have defrayed those costs, as a result of the goods/services provided to the ESF Project for example a bank statement; BACS run

The final bullet point is important to ensure that your ESF Project is only claiming costs from the MA which have actually been incurred by the parent or other organisation. This list is not exhaustive and, depending on the complexity of the internal cost transfer arrangements, the MA may request other documentation in support of any transactions where internal cost transfers are part of the payment process, to ensure there is sufficient documentary evidence for each step from initial payment by the ESF Project to defrayal.

6. Participant Data Schema

Where ESF delivery is being conducted remotely, in the majority of cases projects should use the postcode recorded on the Funding Agreement (for their physical base in the LEP area) as the delivery postcode on the Grant Recipients data storage system (or for the ESFA CFO - Individual Learning Record (ILR). This will ensure that remote activity, such as virtual staff working from home, that is delivered under the Funding Agreement and directly benefits the LEP area under which the Funding Agreement sits, can be considered eligible. If a new temporary postcode is used under this easement, it must be one which falls in the same Category of Region as your project is delivering in, otherwise ECLAIMS will not validate your Participant Data Schema.

Output and Result targets are key performance indicators for ESIF programmes. Every project justifies the level of investment requested from ESIF by agreeing to achieve a number of programme defined outputs and result targets. These targets are scoped and referenced in the application for ESIF funding which is appraised by the MA and form an important part of the FA.

Before submitting any output or results data to the ESF MA, the GR must ensure they have a full audit trail containing all original source documentation for each output and result being reported – in line with the ESF Data Evidence Requirements. This audit trail must be maintained and made available for verification checks and audits and must be retained in accordance with the European Social Fund document retention guidance and ESF National Eligibility Rules and Programme Guidance.

With the exception of Investment Priority 2.2 deliverables, and Investment Priority 3.1 deliverables all outputs and results to be claimed for during the respective Claim Period should be recorded and submitted to the ESF MA using the Participant Data Schema form. It is good practice to submit a single Participant Data Schema with each claim – however, if you have a significant number of lines to report for example. 5,000 or over, you may submit more than one PDS for a given claim period by exception.

Investment Priority 2.2 projects must report on their progress per outputs and results profile in their Progress Report.

IP2.2 deliverables must be reported on the ESF IP2.2 monitoring template which should be uploaded to ECLAIMS.

As stated in the Participant Data Schema Guidance, participant identifiers are how we track participants and their progress. Each participant must have a unique and persistent identifier number. European Union (EU) data protection regulations require that no unnecessary identifying or personal data is collected about the participant. Guidance on the Data Protection Act sets out that consideration should be given to not only the identifying potential of individual items of data but the impact of the total data collected. To this end participant IDs should not be based on any of the following:

• participant’s first names
• participant’s surnames
• participant’s full address

Importantly as a beneficiary organisation you must be able to reconcile a Participant Identification (ID) to a single unique participant, for both audit purposes and participant survey selection. If a participant is selected for a follow up survey, the evaluation team will contact you to request the participant contact details which will be held and processed in a separate system with greater security.

The Participant ID should relate to the submitting organisation, for example DBXXXXXXXXXX = Direct Bid.

A maximum number of characters, including the prefix signifier, should be 22 characters.

Annex 7 of this guidance includes examples of a range of scenarios which may occur in delivery of an ESF product and how these impact on the reporting of associated outputs and results. GRs should ensure they take account of these scenarios when completing their Participant Data Schema, each quarter.

Once the Participant Data Schema, has been completed and the Grant Recipient is content that all data in the schema is correct, the ‘Create Export Sheet’ button must be pressed prior to uploading the document into ECLAIMS. This creates a spreadsheet which is in a format that ECLAIMS can accept and that is without macros. For instructions on uploading of the Participant Data Schema please see the ESF ECLAIMS External User Guidance.

The most up-to date version of the Participant Data Schema form, as well as full guidance on how to complete the form can be found on GOV.UK.

7. Expenditure Forecast

Full and comprehensive information on actual expenditure for previous and current claim periods, as well as contracted expenditure profiles for remaining claim periods is required with every claim to support ESF CMs in reviewing the performance of each project.

The Expenditure Forecast provided needs to be broken down by:

• Investment Priority (IP)
• Category of Region (CoR)

Variances from the contracted profiled forecast, ‘slippage’, must be fully explained and justified within the Progress Report.

You will need to provide details of how your project plans to address any shortfall in the immediate, medium – and longer-term expenditure forecast, this will help inform conversations with your CM.

Any actual underspend variance greater than 15% from the contracted expenditure profiles may result in de-commitment or withdrawal of ESIF funding in line with the underperformance policy. Your CM will discuss this with you if applicable.

Any anticipated variances should be discussed with your CM as soon as possible, who will consider whether a Project Change Request (PCR) is required.

If a PCR has recently been approved by the ESF MA where this changes the future, contracted expenditure profiles, but the amended figures have not yet been updated in ECLAIMS, you should add a note to your Progress Report explaining variances.

8. Outputs forecast and results forecast

Full and comprehensive information on actual performance against each individual Output and Result category for your project previous and current claim periods, as well as contracted target levels for the remaining claim periods, is required with every claim to support ESF CMs in reviewing the performance of each project.

Figures must be broken down by Investment Priority and CoR.

Variances from the contracted profiles, slippage, must be fully explained and justified within the Progress Report.

You will need to provide details of how your project plans to address any shortfall in the immediate, medium – and longer-term expenditure forecast, this will help inform conversations with your CM.

Any actual under performance with a variance greater than 15% from the contracted targets may result in de-commitment or withdrawal of ESIF funding in line with underperformance policy. Your CM will discuss this with you if applicable. Any anticipated variances should be discussed with your CM as soon as possible, who will consider whether a PCR is required.

9. Procurement

All new procurement exercises, already undertaken or yet to be undertaken must be recorded in the Procurement Register in ECLAIMS.

The GR or Accountable Body should record any procurement exercise, undertaken by the:

• Grant Recipients
• Delivery Partner
• Accountable Bodies
• Local Grant Recipients
• Delivery Partners of Local Grant Recipients

The first recorded exercise will be automatically allocated a Procurement Record ID 1, any additional or subsequent procurement exercises added to the register will be allocated a sequential Procurement Record ID of 2, 3 or 4.

Reference to any procurement exercises undertaken in this claim period should be included in the progress report and the relevant record on the procurement register completed with supporting evidence provided.

This should include details of any planned future procurements not already included in the Procurement Register in the Procurement section of your Progress Report including any procured contracts which are used as match-funding and . procurement costs which form part of any ESF Project Costs including procured staff costs.

For example, ESF Direct Bid Projects using the 40% Flat Rate Indirect Cost option should complete the register if there has been procurement of any of the staff costs.

Where a procurement exercise has already been completed, and has not been reviewed, or fully reviewed at appraisal or PIV stage, for example,

• the procurement exercise has been undertaken or
• completed after the PIV was finalised

These will need to be reviewed by the ESF CM at the Desk-Based Administrative Checks (DBAC) stage and an ESF Public Procurement Checklist may need to be completed.

The Checklist is required for all Non-Contracting Authority procurement .

The Checklist is not required where a Contracting Authority has carried out a procurement exercise where the value is below £24,999.99.

In such cases, the CM undertaking the DBAC will still carry out existing, relevant procurement checks to ensure that you are aware of and adhering to the ESIF National Procurement Requirements.

Where the ESF Public Procurement Checklist is required, the CM will ask you to complete and return the checklist, together with any specified Core Documents relating to the procurement exercise.

In all cases the supporting Core Documents and completed checklist should be uploaded into ECLAIMS via the Procurement Register.

Note: it is essential that all procurement exercises are identified by adding the name in the procurement Title, for example. Procurement of IT (Delivery Partner – Joe Bloggs Training).

The ESF Public Procurement Checklist can be issued at any point as part of the ESF CM DBAC process, however the review of any relevant procurement exercises must be finished before any costs from that procurement exercises are included in an ESF Claim.

Where a project has completed more than one procurement exercise a separate checklist may need to be completed for each individual procurement exercise. Where a single procurement exercise has resulted in the award of a number of individual contracts, a single ESF Procurement Checklist can be completed.

If the CM undertaking the procurement checks is unable to obtain sufficient assurance that a Procurement exercise has been undertaken compliantly, they will consider whether expenditure relating to that procurement exercise should be excluded from the current and any future claims for the given ESF Project or whether a Financial Correction would be appropriate. Depending on the seriousness of the issue the CM may also consider

• terminating the FA for that ESF Project

It may also be necessary to consider

• whether other FA or MOUs linked to that procurement exercise should be terminated by the MA

Once the CM has completed the relevant procurement checks, they will notify you of the outcome, and include details of any impacts on current and or future claims.

The CM will also update the Procurement Register in ECLAIMS to show that the procurement checks have been completed.

Note: You must notify the CM of any instances where you:

• have decided not to progress with a planned procurement
• have withdrawn a contracted procurement
• will not be making purchases for the ESF project under a contracted procurement

10. ESF Progress Report

A full and comprehensive narrative Progress Report with suitable commentary must be completed and submitted to the MA with each quarterly claim.

The Progress Report must be recorded directly into the relevant fields in ECLAIMS unless the GR has a prior agreement from the CM that they can submit their report as a separate document, uploaded into ECLAIMS as part of the package of claims documentation.

GR’s should note that they will still need to work through the Progress Report screens in ECLAIMS in these circumstances before attaching their narrative report otherwise ECLAIMS will not allow submission of the claim.

A full and comprehensive narrative should be provided under all headings see annex1.

For example: the performance and progress of the project to date and the planned activity going forward must:

• provide sufficient detail to demonstrate successful delivery of the activities and deliverables
• include the measures being put in place to bring the project back on track is there is any slippage of performance
• include any project specific updates as stipulated within the project specific conditions of your funding agreed or requested by our CM

The Claim may be rejected on ECLAIMS if any of the information is incomplete or considered insufficient or incorrect.

As a minimum, for the Equal Opportunities element of their Progress Report, the GR should provide an update on the following within their narrative:

• any improvements
• updates
• amendments
• details of performance against profile in terms of any equality targets; and any
• under-performance identified, and the mitigating or corrective action that will be taken that you have made during the claim instalment period in terms of the governance of the Equality and Diversity theme in your project.

As well as:

• any progress in achieving aims during the claim instalment period
• any progress in achieving objectives during the claim instalment period

These should be set out in your Equality and Diversity policy or implementation plan and supporting evidence provided.

As a minimum, for the Sustainable Development section of your Progress Report, the GR should provide an update on the following within their narrative:

• any improvements
• updates
• amendments that you have made during the claim instalment period in terms of the governance of the Sustainable Development theme in your project.

As well as:

• any progress in achieving aims during the claim instalment period
• any progress in achieving objectives during the claim instalment period

These should be set out in your sustainable development policy or implementation plan and supporting evidence provided.

11. Desk-based evidence check (DBEC)

Before the claim is paid, the MA may select and request the source documentation on a number of transaction items to test for evidence of defrayal. The ESF ECLAIMS External Users Guidance published here on GOV.UK explains how to view the MA request for evidence and how to upload your resulting documentation.

The MA will identify the specific documentation to be sampled and request the information via the Documentary Evidence Check button on ECLAIMS. You must upload the requested evidence into ECLAIMS within 5 working days and notify your ESF CM via email when the upload has taken place.

To minimise risks around the processing of personal data, please do not provide any evidence that is not specifically requested by the ESF MA.

If one or more items of requested evidence is not received with the original 5 working day deadline, the ESF Contract Manager will issue a reminder to the Grant Recipients to submit the evidence.

If the GR still fails to provide the relevant evidence, the ESF CM should consider rejecting the whole claim, given the failure of the GR to provide the full and comprehensive information required under their ESF FA.

Where a GR is not able to provide full and comprehensive information for more than two Claim Periods in a row the MA may decide to pause processing of claims and or claim payments whilst they consider whether ‘event of default’ action or other penalties may be appropriate.

All evidence must be certified as a true copy of originals or supported by a covering letter which confirms that all documents are true copies of originals. Certification must be confirmed by the project’s Authorised Signatories in line with scheme of delegation of the GR.

If, on review of the evidence provided, the selected expenditure presents significant issues, then the MA will extend the sample to check that the issues are not systemic. Where the MA chooses to extend the sample, they will raise a request through the ‘Queries’ function in ECLAIMS. You will then be able to respond to MA via the ‘Queries’ section in ECLAIMS and upload all the additional evidence that has been requested. This will ensure there is an in-system audit of all action taken. You must formally respond to all queries via ECLAIMS even if you have provided the information verbally, or by email. You should not tick the ‘Query Complete’ box despite the instruction to do so on ECLAIMS.

The Checklist (below) lists examples of the types of questions the MA will consider when looking at a submitted claim and the relevant supporting documents (Part 1) and when undertaking the Desk-Based Evidence Checks (Part 2).

GRs must ensure that full and comprehensive information and supporting documents submitted as part of the claim itself, as well as any subsequent evidence or source documentation submitted to the MA in response to Desk-Based Evidence Checks, satisfy the checks listed below.

Please note that, for ESF Direct Bid Projects defrayal checks on ESF Direct Staff Costs have been reintroduced as part of the Desk Based Evidence Check (DBEC) processes from Q4 2018 claims onwards.

For ESF Direct Bid projects where staff salary costs are selected for DBEC, GRs must be asked to provide defrayal evidence in the following cases:

• all cases where full-time or part-time staff are working all of their time on an ESF Project; and

• where a full-time or part-time member of staff is working some of their time on an ESF project and where the hourly rate for that individual pre-dates the introduction of the standard ESF 1720 hourly rate calculation

Staff working part of their time on an ESF project and whose hourly rates are calculated using the 1720 hourly rate methodology or the Fixed Percentage methodology are exempt from any staff salary defrayal evidence checks at the Desk Based Evidence stage.

Volunteer Time In-Kind

Timesheets will be needed for all ESF Project staff who are being used as ‘Volunteer Time In-Kind’. This is regardless of whether they are working full-time or part-time, or whether they are working part or all of their time on the project. This is also regardless of the methodology used to calculate their notional salary costs. As per the ESF Programme Guidance, this is because Volunteer Time In-Kind staff will not have any salary evidence or equivalent, so use of timesheets is a way of evidencing that they are actually in place and working as a volunteer on the ESF Project.

Checklist – Part 1

Q1 Do all of the defrayal dates fall after the invoice dates?

Defrayal should usually follow receipt of the invoice. However, there may be circumstances where the invoice is received after defrayal. In these circumstances you should request an explanation from the GR and provide comments in the comment box.

Q2 Does the expenditure detail or description provide sufficient information to meet DBEC requirements?

If not claim should be returned to GR to amend.

Q3 Does the treatment of VAT within the Transaction List follow the agreed approach?

The treatment of VAT will be outlined in the Full Application. If VAT has been included in the Claim that is different from the agreed approach, then the Claim must be returned to GR to amend.

Q4 Do you consider all of the expenditure, within the sample, to be both relevant and eligible, as detailed within the FA?

If no, then the transaction line should be returned to be amended, or the Claim Approver should select the items of ineligible expenditure to be removed.

Q5 Is all the expenditure claimed under the appropriate cost heading?

If no, then the transaction line should be returned to be amended, or the Claim Approver should select the items of ineligible expenditure to be removed.

Q6 Do the apportionment methods used follow the agreed methodologies and are they still relevant?

If no, then the transaction line should be returned to the GR for apportionment methodologies to be revised.

Q7 If applicable, have hourly rate methods been agreed and are they still relevant?

If no, then the transaction line should be returned to the GR in order for hourly rates to be revised.

Q8 Has sample evidence verification check been undertaken on the Claim?

Desk based check should be undertaken on every Claim unless subject to an exception.

Checklist – Part 2 Documentary Evidence

Q9 Does the cumulative claimed expenditure within each cost heading fall below the contracted values?

If no, the Claim may still be able to be paid but Grant Certifier should approach the project and discuss the submission of a PCR.

Q10 Has the project reached its retention limit prior to this Claim?

Not Applicable to ESF at present.

Q11 Hold for retention?

Not Applicable to ESF at present.

Q12 Will the project reach the retention limit with this Claim?

Not Applicable to ESF at present.

Checklist – Part 3 Progress Report

Q13 Has a detailed progress and monitoring report been completed and is this satisfactory?

Please refer to Annex 1 for information on what should be provided in the progress section.

Q14 Have all relevant procurements to the Claim Period been recorded and do they comply with European Union (EU) thresholds?

Review procurement register and if it has not been updated where applicable, then raise a Query with the GR to provide the information to enable the register to be completed. If procurement does not comply with EU requirements the Claim should be suspended until the issue is investigated and resolved. Please refer to ESIF national procurement requirements.

Q15 Have there been any changes to the project’s State Aid status or measures?

The GR must provide an update on State Aid in their Progress Report. Do the State Aid measures in the Progress Report align with those in the project FA or MOU?

If the response is ‘no’, ensure the ESF State Aid Checklist is issued to the GR and resulting MA action taken.

A response of Not Applicable is not acceptable.

If the GR has recorded a response of Not Applicable, this should be rejected by the CM and referred back to the GR so they can provide an acceptable response before the claim is approved.

Deliverables

Q16 Are the outputs or results confirmed as eligible?

Review outputs and or results evidence and provide explanation as to how they are eligible. If not eligible, then return to GR to amend.

Checklist – Part 4 claim approval

Q17 During the checking of the Claim, have any potential Irregularities been identified that relate to this or any previous Claims?

This includes systemic errors that you may wish to raise and also flat-rate corrections.

Q18 Are there any outstanding actions which may impact on the payment of this Claim?

This could relate to Project Inception Visit, Article 13 and Article 16 actions that are outstanding, consideration needs to be given if this would be something that would prevent payment.  

12. Annex 1: Progress report

12.1 Progress

If a single contract covers more than one Local Enterprise Partnership (LEP) area, he Management Information must be provided for each area separately on submission of the Claim.

Expenditure

You should report on the performance of actual expenditure against the profiled values contained in the FA or MOU and recorded on ECLAIMS.

Information should include actual expenditure for previous and current claim periods.

Upload any internal MI currently used to report progress to date against the deliverables within your project or use a separate document.

Expenditure must be broken down by:

• Local Enterprise Partnership area
• Investment Priority, and (where applicable)
• Category of Region

Comments must include future forecast, for example contracted expenditure profiles for remaining claim periods for every claim, this will support the CMs in reviewing the performance of each project.

Variances from the contracted profiled forecast, slippage, must be fully explained and justified within the Progress Report and submitted along with the claim.

You should explain whether the project is still on track and to budget, and expenditure slippage must be explained and justified with plans outlined on how the slippage will be addressed.

Any potential overspends in cost categories or a request to re-profile expenditure should be flagged up here.

Any actual underspend variance greater than 15% from the contracted expenditure profiles may result in de-commitment or withdrawal of ESIF funding in line with the underperformance policy.

Any anticipated variances should be discussed with your CM as soon as possible, who will consider whether a PCR is required.

Your CM will discuss this with you if applicable.

Where a PCR has recently been approved, if this changes the future, contracted expenditure profiles, but the amended figures have not yet been updated in ECLAIMS, add a note to the Progress Report explaining why the reported figures do not match your current ECLAIMS expenditure profiles

Outputs, Results and Additional Targets

You should report on the actual achievement of targets and future forecast compared to the profile outlined in the FA.

Information should include actual achievement for the current claim period and cumulative achievement for previous claim periods.

Upload any internal MI currently used to report progress to date against the deliverables within your project or use a separate document.

Outputs and Results must be broken down by:

• Local Enterprise Partnership area
• Investment Priority

and (where applicable)

• Category of Region.

This should include full and comprehensive information on actual performance against each individual Output and Result category for your project previous and current claim periods.

Variances from the contracted profiles, slippage, must be fully explained and justified within the Progress Report and submitted along with the claim.

The contracted target levels for the remaining claim periods, is required with every claim to support ESF CMs in reviewing the performance of each project.

Any actual under performance with a variance greater than 15% from the contracted targets may result in de-commitment or withdrawal of ESIF funding in line with underperformance policy.

Identify any specific issues encountered relating to measuring or evidencing the targets or take up of assistance from businesses.

If there is any slippage, provide detail on remedial measures being put in place to bring things back on track.

Any anticipated variances should be discussed with your CM as soon as possible, who will consider whether a PCR is required.

Your CM will discuss this with you if applicable.

Where a PCR has recently been approved, if this changes the future, contracted output and, or result profiles, but the amended figures have not yet been updated in ECLAIMS, you should complete the Progress Report with the approved, revised PCR contracted figures to explain why the ‘figures do not match the ECLAIMS profiles.

Objectives and Project Specific Conditions

Report progress on specific conditions in FA.

Income – Excess and unexpected and Article 61/65.8

Not applicable to ESF – Input “Not Applicable”

Equal Opportunities

For Equal Opportunities you should provide an update of progress in terms of promoting equality and equality performance.

You should provide a short, written narrative in the equal opportunities field of the report. The narrative should cover on what improvements, updates and, or amendments have been made to show how the Equality policies and implementation plans have progressed in the Claim Instalment Period.

As a minimum, the GR should provide an update on the following within their narrative:

• where appropriate, what specific actions are being taken to promote female recruitment?

• where appropriate, what specific actions are being taken to tackle obstacles created by caring responsibilities?

• what specific actions are being taken around Disability access for example to buildings?
• what commitment is in place to provide specialised support for disabled

• details of progress against the ESF Project specific Equality and Diversity Implementation Plan for the project

• details of any reviews undertaken, who led that review, what documentation was produced and if any further revisions were made to the plan as a result

• some basic detail on performance against profile in terms of any equality targets, including any achievements against targets within the Implementation Plan

• whether or not any under-performance has been identified, and, if so, the mitigating or corrective action that will be taken

• when the next review is scheduled

• any evidence in support of the above must be uploaded with the Progress Report

12.2 Match funding

Report on the funding received during the Claim Instalment Period as well as the cumulative values received to-date. Any potential changes to the funding package should also be referred to.

12.3 Milestones and future activity

Summary of planned activities for the next Claim Instalment Period

An outline of the key activities planned for the next Claim Instalment Period including any key dates or events. If there is any future major activity planned beyond the next Instalment Period. You should provide an update in this section. You will also need to report against any slippage in the current claim period that may impact the delivery of your project.

12.4 State Aid

State Aid measures applicable to the project will have been identified at appraisal and will automatically feed through to the claims profile. Provide update on State Aid received as a GR and what State Aid has been dispersed to employer beneficiaries, including those relating to paid work placements and internships.

Your progress report must include a narrative explaining what checks have been undertaken to ensure that the project is operating State Aid processes in line with your ESF FA and the following published guidance on GOV.UK European Social Fund 2014 to 2020 State Aid Guidance. Your narrative should also explain how you have ensured a complete set of State Aid evidence is being retained in line with the published [ESF Document Retention guidance](https://www.gov.uk/government/publications/european-social-fund-document-retention/european-social-fund-document-retention-guidance]

You should also refer to the guidance issued in Action Note 058/21 when considering the narrative for this section.

For projects which have a state aid exemption you Progress Report should reflect the exemption applicable. The only exemptions applicable to the ESF Programme are:

• De Minimis
• 45030 Aid for Disadvantaged Workers General Block Exemption Regulation (GBER)
• 45031 Training Aid (GBER)

All other exemptions are not applicable to the ESF Programme. A blank exemption is a permissible response if either state aid does not apply or there has been no use of the agreed exemption within the claim instalment period.

In addition, the GR must also ensure they have valued the aid appropriately and provided detail on the methodology used by the project. In the ESF programme there are two methods permissible for valuing aid. Method 1 is the preferred approach and should be used by projects, and only where in exceptional cases should the GR Use Method 2. Details on the methods are provided below:

• Method 1 relates to an average of the costs if that support was bought privately. Using this method, the GR will need to explain how they have calculated that average, for example through comparison of three other suppliers and calculating the average of the costs based on this information; or

• Method 2 relates to their real costs (such as the hourly rate of the member of staff who is providing the support, plus the 15 or 40% FRIC attributed to that salary. The GR should use the hourly rate applied to the member of staff undertaking the cost with an uplift of the appropriate FRIC for the project by the number of hours to complete the task to identify the level of aid.

These are the only methods available for use. No other methodology proposed by GR can be used.

12.5 Valuing Aid – worked examples

Method 1

A GR is providing a Small and Medium size Enterprises (SME) with a Training Needs Analysis, and then developing a training plan for a group of the staff who work for the SME.

In this case, the GR takes an average of the costs 3 other providers would charge the SME for this activity, so, for example;

• Joe Bloggs Training Ltd would charge £1,500 for a TNA for an SME with less than 50 employees, and a further £500 for a training plan, giving a total of £2,000
• Jane Doe College Services Ltd would charge £1,350 for a TNA and a further £700 for a bespoke training plan, so total would be £2,050
• Training R Us Ltd would charge £1,700 for the TNA, and include the bespoke training plan free of charge

Therefore, the average of these providers would be (£2,000 + £2,050 + £1,700 = £5,750 divided by 3) £1,916.67 worth of aid.

If the project is using the De Minimis route, this would be the amount of De Minimis aid that they need to tell the SME that they have received. If the project is using the GBER, this is the total aid amount, and they will need to seek the SME contribution to this total (under Training Aid for example, the SME must contribute 50% of these costs, so the GR would need to invoice the SME for £958.34).

Method 2

The GR is providing an SME with a Training Needs Analysis, and then developing a training plan for a group of the staff who work for the SME, as above.

In this case, the GR should take the hourly rate for the member of staff doing the Training Needs Analysis, include the Flat Rate Indirect Cost (FRIC) uplift, then multiply that by the number of hours taken to carry out the Training Needs Analysis and development of the plan for example, £27:15 per hour (including 15% FRIC) x 43 hours = £1,167.45 worth of aid.

If De Minimis applies, this is the amount of De Minimis aid the GR will need to inform the SME they have received, and if they are using the GBER they will need to invoice the SME for 50% of the costs (£583.73).

For those claims where either of the GBER exemptions outlined above are acceptable against the project the progress report should also include the value of aid for the claim instalment period. However, although the value of aid is not a requirement where De Minimis applies the GR is still required to have calculated the value of aid using one of the methodologies above to ensure the aid is calculated and reported on for the purposes of 3-year €200,000 ceiling.

A response of Not Applicable is not acceptable on any aspect of State Aid, including the valuing method, level of aid and the exemption applied. If you record a response of Not Applicable or equivalent, the CM will not be able to approve your claim. Instead, they will refer your claim back to you, requesting that you provide an updated, acceptable response.

If you have assessed at application stage, that State Aid does not apply to your project you should confirm here that that there has been no change, and that you have assessed that State Aid is not relevant to this claim. If your assessment of State Aid has changed you should discuss this separately with your CM.

12.6 Further Progress

12.7 Sustainability monitoring

You must report on the Sustainable Development of your project, including: -

• is there an adequate Sustainability policy and implementation plan in place?

• are the policy and plan subject to regular review?

  • who is responsible for leading that review?
  • what documentation is produced
  • any progress updates
  • when is the next review due?
• any improvements, updates or amendments that you have made in terms of the governance of the Sustainable Development theme in your project?
• any progress in achieving aims and objectives set out in your sustainable development policy or implementation plan during the claim instalment period?
• any evidence in support of the above must be uploaded with the Progress Report Supporting evidence.

12.8 Branding and Publicity

Report on any publicity activity that has taken place during the Claim Instalment Period. This may include publicity material, leaflets, banners or stationery and any press releases, newspaper articles or publicity events. Review any evidence uploaded referring to Branding and publicity requirements for the 2014 to 2020 European Regional Development Fund and European Social Fund.

12.9 Procurement

Reference to any completed procurement exercises as well as any planned future procurements should be included in the Procurement’ section of your Progress Report, this includes any procured contracts which are used as match funding.

Where there are procurements that have already been completed, that have not been reviewed, or fully reviewed at appraisal or PIV stage – for example, the procurement exercise has been undertaken or completed after the PIV was finalised - these will need to be reviewed at the Desk-Based Administrative Checks (DBAC) stage and an ESF Public Procurement Checklist may need to be completed.

The Checklist is not required where a Contracting Authority has carried out a procurement exercise where the value is below £24,999.99.

In such cases, the CM undertaking the DBAC will still carry out existing, relevant procurement checks to ensure the CFO is aware of and adhering to the ESIF National Procurement Requirements published on GOV.UK.

Where the ESF Public Procurement Checklist is required, you will be asked to complete and return the checklist to the Contract Manager, together with any specified ‘Core Documents’ relating to that procurement exercise.

Generally, all supporting Core Document and completed checklist should be uploaded into ECLAIMS against the relevant ID on the procurement register.

Note: it is essential that all procurement exercises are identified by adding the name in the procurement Title, for example. Procurement of IT (Delivery Partner – Joe Bloggs Training).

The ESF Public Procurement Checklist can be issued at any point in the DBAC process, however, the review of any relevant procurement exercises must be finished before any costs from that procurement exercises are included in an ESF Claim.

Where you have completed more than one procurement exercise a separate checklist should be completed for each individual procurement exercise.

Where a single procurement exercise has resulted in the award of a number of individual contracts, a single ESF Public Procurement Checklist can be completed.

In all cases you should ensure that you upload any supporting Core Documents into ECLAIMS against the relevant ID on the procurement register.

If the CM undertaking the procurement checks is unable to obtain sufficient assurance that a Procurement exercise has been undertaken compliantly, they will consider whether expenditure relating to that procurement exercise should be excluded from the current and any future claims for the given ESF Project, or whether a Financial Correction would be appropriate.

Depending on the seriousness of the issue, the CM may also consider whether the FA for that ESF Project should be terminated by the MA. Depending on the seriousness of the issue, it may also be necessary to consider whether other CFO MOUs or FAs linked to that procurement exercise should be terminated by the MA.

Once the CM has completed the relevant procurement checks, they will notify you of the outcome, including any impacts on current and, or future claims. The CM will also update the Procurement Register in ECLAIMS with details of that procurement exercise.

You must notify the CM of any instances where you:

• have decided not to progress with a planned procurement
• have withdrawn a contracted procurement
• will not be making purchases for the ESF project under a contracted procurement.

Assets

Not applicable to ESF - Input No Assets in claim period.

The Claim may be rejected on ECLAIMS if any of the information is incomplete or is considered insufficient or incorrect.  

13. Annex 2: Revenue Cost Categories Desk Based Checks and evidence to be provided to the MA

Category – Direct Staff Costs – Salaries

Personnel directly working on the project spending all or part of their time on the project

Evidence

HR letter of appointment and job description containing the correct branding logo that acknowledges post is funded by ESF from [date] (all staff).

Timesheet for full-time or part-time staff who only work some of their time on the ESF Project and for all full-time and part-time ‘Volunteer Time In-Kind’ staff.

Defrayal evidence all cases where full-time or part-time staff are working all of their time on an ESF Project; or where a full-time or part-time member of staff is working some of their time on an ESF project and where the hourly rate for that individual pre-dates the introduction of the standard ESF 1720 hourly rate calculation.

Detailed breakdown of the staff hourly rate calculation for full-time or part-time staff who only work some of their time on the ESF Project.

In addition, where the 1720 hourly rate calculation methodology has been used. This must:

• show the final hourly rate amount resulting from the 1720 calculation and how the calculation has been based on the ‘latest documented annual gross employment costs’ for that individual as set out in the most up-to-date Granular Budget or Staff Costs Master List document, agreed with the ESF MA at the most recent staff costs hourly rate review point.
• show how the GR has ensured that only the hours worked by the individual during the claim period have been used for calculating the eligible staff costs. Annual leave should not be included as this is already taken into account in the 1720 methodology.
• evidence of the latest documented annual gross employment costs used the calculation for example, payslip, P60

For ESF Projects who are using the earlier hourly rate calculation which pre-dates the introduction of the 1720 methodology, the detailed breakdown must align with the ESF hourly rate methodology set out in Version 2 of the ESF National Eligibility Rules.

In all cases the number of hours being claimed for the individual at the relevant hourly rate, must align with the number of hours recorded for that individual on the accompanying timesheet(s) for the relevant claim period.

Where the ‘Fixed Percentage’ methodology has been used, the GRt must provide:

• a copy of the contractual document which confirms the fixed percentage of time per month the employee is working on the ESF Project
• a copy of the payslip and any other documents, where necessary, which show the actual gross employment costs which have been used to calculate the correct ‘Fixed Percentage’ ESF Direct Staff Costs amount for the selected transaction line.

Category – Indirect Costs – Overheads

Flat Rate percentage – 15% or 40%; whichever is detailed in FA.

Evidence

Do not count towards the DBEC sample.

Category – Other Direct Costs – General

General administration costs associated with the direct delivery of the project that are not shared for example, office equipment, stationary, consumables, expendable supplies, participant costs, equipment. This list is not exhaustive.

Evidence

Invoices incurred solely for the ESF project, BACS and bank statements (all certified as true copies by Authorised Signatories in line with scheme of delegation of the applicant).

Category – Other Direct Costs – Premises

Rent, rates, heat light and service charges that are exclusively for the direct delivery of the project that are not shared.

Evidence

Invoices incurred solely for the ESF project, BACS and bank statements (all certified as true copies by Authorised Signatories in line with scheme of delegation of the applicant).

Categories – Other Direct Costs – Fees

Independent consultants or contractor, accounting audit costs, guarantees, bank transaction costs.

Evidence

Invoices incurred solely for the ESF project, BACS and bank statements (all certified as true copies by Authorised Signatures in line with scheme of delegation of the applicant).

Category – Other Direct Costs – Marketing

Marketing and publicity costs for the project.

Evidence

Invoices, BACS and bank statements (all certified as true copies by Authorised Signatures in line with scheme of delegation of the applicant).

Category – Other Direct Costs – Other Revenue

Sundry expenses, business travel, subsistence, direct staff expenses.

Evidence

Invoices, BACS and bank statements (all certified as true copies by Authorised Signatures in line with scheme of delegation of the applicant) or credit card payments

Category – Other Direct Costs – Procurement

Expenditure through procured goods or services

Evidence

Written assurance that the procurement exercise was conducted wholly in line with the European Structural and Investment Funds national procurement requirements as well as written confirmation that a complete set of evidence has been retained for the related procurement – aligned to the specific documents set out in the published European Structural and Investment Funds procurement aide memoire for applicants and grant recipients.

GRs must also be able to provide actual procurement documentation to support Desk-Based Checks if requested by the MA.

14. Annex 3: Help sheet for Invoice Transactions

All submissions should be clearly understandable to a third party with no link to the project and we suggest you test this internally before submitting evidence.

Transaction List Reference	For example, A, B,C, Red, Green, Blue
Date	The invoice should be dated within or close to the period – Period Covered by the invoice. This may be different from the actual date of the invoice.
Project Name	Items specifically purchased for the Project, to which the invoice is being charged, should be referenced on the invoice
Invoice No or Ref	This reference should follow through all levels of related documentation to at least the point it is posted to the Purchase Ledger
Purchase order ref	This reference can be an alternative or additional to, the Invoice number and, if used, on documentation to defrayal.
Name or Company providing Invoice	Additional info to identify invoice as appropriate.
Amount Claimed	Ideally this will be 100% to the project. However, if it is an apportionment, an invoice covering a number of projects or if the amounts do not match in any way, this should be clearly highlighted and an explanatory note and or calculation included. Initialled and dated. The explanatory note and or calculation must be initialled and dated.
Scheduled Payment	If the invoice is a part payment with a scheduled call-off agreed, the Purchase Order should also be provided as evidence the call-off payment is correct.
Purchase Ledger	The invoice should be shown on the Purchase Ledger and shown as paid. A screen dump of the Purchase Ledger showing this should be provided and wherever possible this should link to the BACS payment
BACS Run	For example, the payment should be clearly shown within the BACS run with explanatory figures linking this to respective documents Wherever possible the amount claimed should be highlighted in a BACS build up.
Bank Statement	For example, defrayal of costs from the Bank Account. The figure being defrayed should match that of the BACS run. If the Bank Statement figures do not match BACS, an explanation of the difference should be included with backup documentation and calculations to demonstrate the Bank Statement figure.

15. Annex 4: Grant Recipient Help sheet Template for Salary Transactions

All submissions should be clearly understandable to a third party with no link to the project and we suggest you test this internally before submitting evidence.

Project Name	For example ESF123
Claim Month	Month Year
Transaction List Item Reference	For example A, B, C or Red, Green, Blue
Employee Name	For example, A.N. Other
Payroll no.
Gross Pay per Month
Amount claimed in Period
Project cost code used
Job Description	For example, Job Description for the role of Officer in relation to transaction item A attached for A.N. Other. Needs to name the project and make reference to being part funded by European Funding. Time sheet (Only needed If the employee is being claimed on an hourly rate against the project) Such as, 10 hours for A.N. Other employed on ESF123 Such as, 10 hours’ x £15 per hour = £150(Total hours worked in the period on all projects ESF and non ESF should be recorded on all timesheets. If a Cost Code is used this should be clarified with the checking officer)Signed and dated by the Employee and counter signed and dated by their Line Manager.
Hourly Rates	For example, shows actual calculation used to determine the hourly rate for A.N. Other of such as, £15 per hour, as well as the type of hourly rate methodology used. For all ESF projects who responded to calls published on or after 17th March 2016, the 1720 Hourly Rate calculation set out in Section 10 of the ESF National Eligibility Rules and Programme Guidance must be used for staff who work part time or part of their time on the ESF Project, unless the ESF Project has opted instead to use the ‘Fixed Percentage’ methodology for that individual. Evidence to be retained for OTSV and or audit purposes for hourly rate cases needs to include Show the final hourly rate amount resulting from the 1720 calculation and how the calculation has been based on the ‘latest documented annual gross employment costs’ for that individual as set out in the most up-to-date Granular Budget or Staff Costs Master List document, agreed with the ESF Managing Authority at the most recent staff costs hourly rate review point. Show how the Grant Recipient has ensured that only the hours worked by the individual during the claim period have been used for calculating the eligible staff costs. Annual leave should not be included as this is already taken into account in the 1720 methodology. Evidence of the latest documented annual gross employment costs used the calculation for example, Payslip, P60.
Job Description	For example, Job Description for the role of Officer in relation to transaction item A attached for A.N. Other. Needs to name the project and make reference to being part funded by European Funding.
Time sheet (Only needed If the employee is being claimed on an hourly rate against the project)	Such as, 10 hours for A.N. Other employed on ESF123 Such as, 10 hours’ x £15 per hour = £150 (Total hours worked in the period on all projects ESF and non ESF should be recorded on all timesheets. If a Cost Code is used this should be clarified with the checking officer). Signed and dated by the Employee and counter signed and dated by their Line Manager.
Hourly Rates	For example, it shows actual calculation used to determine the hourly rate for A.N. Other of such as £15 per hour, as well as the type of hourly rate methodology used. For all ESF projects who responded to calls published on or after 17th March 2016, the 1720 Hourly Rate calculation set out in Section 10 of the ESF Programme Guidance must be used for staff who work part time or part of their time on the ESF Project, unless the ESF Project has opted instead to use the ‘Fixed Percentage’ methodology for that individual. Evidence to be retained for OTSV and or audit purposes for hourly rate cases needs to include Show the final hourly rate amount resulting from the 1720 calculation and how the calculation has been based on the ‘latest documented annual gross employment costs’ for that individual as set out in the most up-to-date Granular Budget or Staff Costs Master List document, agreed with the ESF Managing Authority at the most recent staff costs hourly rate review point. Show how the Grant Recipient has ensured that only the hours worked by the individual during the claim period have been used for calculating the eligible staff costs. Annual leave should not be included as this is already taken into account in the 1720 methodology. Evidence of the latest documented annual gross employment costs used the calculation for example, Payslip, P60.
Fixed Percentage Staff Costs	Copy of the contractual document which confirms the fixed percentage of time per month the employee is working on the ESF Project and a copy of the payslip and any other documents, where necessary, which show the actual gross employment costs which have been used to calculate the correct ‘Fixed Percentage’ ESF Direct Staff Costs amount for the selected transaction line.
Payroll Reports	For example, Payroll report detailing gross pay and all pay costs for A.N Other for [month] as highlighted. A narrative should be provided if it is not clearly possible to demonstrate the links between the documents for both full time and hourly charged employees. Where possible, provide a link between the BACS payment and the monies defrayed. If this link cannot be clearly made, an explanation should be provided as to why not. Screen dumps are acceptable as long as the accounting package is identified and certified as a true copy of the original.
Pay Advice Reports	For example, a breakdown of pay costs, pay deductions and net pay due to the employee.
BACS Run	For example, total Organisation payroll of [£X] with explanatory figures linking this to respective documents. As with payroll above, notes should be added to documents to demonstrate links between them. Supporting calculations where NI is paid on a different BACS run should be included and a note provided making the link. Wherever possible the amount claimed should be highlighted in a BACS build-up and included within the evidence.
Bank Statement	For example, defrayal of costs from the Bank Account. The figure being defrayed should match that of the BACS run. If the Bank Statement figures do not match BACS an explanation of the difference should be included with backup documentation and calculations to demonstrate the Bank Statement figure.
National Insurance	If organisations pay their NI and pension contributions monthly, it can be automatically accepted that these will be paid and that the relevant defrayal date is the date the payroll is paid. This approach is used for Article 125 testing.

16. Annex 5: Glossary

Defrayal	Claims are to be submitted in arrears for each Instalment Period and only eligible expenditure defrayed (incurred and ‘paid’ (cleared bank account) by the end of that period can be included in the Claim for reimbursement.
Claim	The GR must notify the MA promptly if at any time it becomes aware that it is unable to make a Grant Claim in accordance with the outlined timescales or in accordance with the expenditure profile.
Intervention Rate	Grant payments are calculated as a percentage “Intervention Rate” against expenditure reported within the Claim.
Nil Claim	In the event where no expenditure has been defrayed during the Instalment Period a Claim must still be submitted through ECLAIMS, providing details of progress towards delivery and achievement of the project objectives or activities.
Payment	The Claim will only be processed for payment once the MA is satisfied that all information is present, complete and complies with the terms and conditions of the FA and National Eligibility Rules.
Errors	If at any stage the GR identifies any mistakes or omissions on any of its Claims, whether paid or in the process of being paid, they must contact the MA as soon as possible. Where errors, on data, are identified on Claims that have already been paid GRs will need to follow the Self-Declared Adjustment process detailed in the ECLAIMS Process for Self-Declared Adjustments guidance.
Issue	A transaction on ECLAIMS where your CM asks you to take additional action on the claim you have submitted such as. amending or removing details on a transaction line.
Query	A transaction on ECLAIMS where your CM has a question regarding the claims information you have supplied and needs further details and or clarification.

17. Annex 6: Common claim errors

Based on the ESF Programme claims received to-date, the following are good practices recommended for all GRs to avoid queries and support the submission of admissible, ‘right first time’ claims.

17.1 Transaction list

1. Descriptions of expenditure in Transaction Lists should be sufficiently detailed to enable the MA to immediately understand what exactly the expenditure is so that it can be readily checked and confirmed as eligible. Descriptions should not include abbreviations or jargon which the MA may not understand.

2. Where ‘Other Direct Costs’ are directly related to a specific participant (such as, childcare costs, travel costs), the GR must include the participant unique identifier from the Participant Data Schema in the expenditure description in the Transaction List, to allow the MA to attribute the costs to a valid participant. Actual participant names must not be included in the Transaction List or Participant Data Schema.

3. Where applicable, a clear description of the apportionment between CoR, Investment Priorities, ESF and Match and (if applicable) YEI, should be noted in the Apportionment Details column, so the Managing Authority can understand how, from the total invoice value, the GR has arrived at the total eligible amount.

4. The total invoice value must exclude VAT

5. The Flat Rate Indirect Cost indicator must only be set to ‘Y’ against applicable, eligible staff costs. The indicator must not be set to ‘Y’ for any costs which are ‘Other Direct Costs’

17.2 Participant Data Schema

1. Ensure you are using the correct, latest version Participant Data Schema.

2. Once the participant data has been added via the relevant drop-down boxes, and the export sheet has been created, do not overtype any of the information in the Participant Data Schema, before uploading it to ECLAIMS – this will risk validation errors and or may result in the wrong MI being reported for your project.

3. Report all participant related ESF output and results in a single Participant Data Schema for each quarterly claim. This will support accurate sampling for desk-based checks, speeding the claims approval and payment process.

18. Annex 7: Output and results scenarios

18.1 Scenario 1 – Participant starts ESF intervention and all data is complete at point of starting.

In this scenario, any appropriate Programme Specific and Common Output indicators are captured at the point the starting information is declared on the Participant Data Schema (PDS) to the MA. See illustrated example below.

Guidance:

Section 3.1.1 page 10 of the EU ESF Monitoring and Evaluation guidance refers:

In order to fulfil the data completeness requirement, data on participants shall be complete with regard to all common output indicators covering personal non-sensitive data: Gender, employment status, age, education level, and household situation.

18.2 Scenario 2 – Participant starts ESF intervention and all data is complete at point of starting, then participant leaves ESF intervention and all data is complete at point of leaving.

In this scenario, any appropriate Programme Specific and Common Output indicators are captured at the point the starting information is declared on the PDS to the MA. Any appropriate Programme Specific and Common Result indicators are captured at the point the leaving information is declared on the PDS to the MA. See illustrated example below.

Guidance:

Section 3.4.1 page 18 EU ESF Monitoring and Evaluation guidance refers: (Data Recording and Storage);

The individual participants’ data for all person-related indicators must be recorded and stored in a way that allows a Member State to perform the tasks it is legally required to perform. Therefore, all records should include, as a minimum: an identifier for the operation/project; a personal identifier that allows an individual to be traced and re-contacted; dates of starting and leaving an operation; and access to values for all variables needed for indicators.

18.3 Scenario 1 and 2 Example:

A participant joins a single project within an operation, completes the planned activity and leaves.

In the scenario above a participant joins a single project within an operation, completes the planned activity and leaves.

In the first stage the participant is interviewed and referred to a 3 month training scheme. The Output indicators on entry, refer to their situation on entry to the operation, which is their situation on the first day of training.

All information collected at interview and the referral point must be verified.

The participant then undertakes 3 months training.

Intermediate result indicators refer to the participant’s situation at point of exit from the operation (in this case the leaving date), or within 4 weeks after.

18.4 Scenario 3 – Participant starts ESF intervention and all data is complete at point of starting, then leaves intervention early and leaving data is complete.

In this scenario, any appropriate Programme Specific and Common Output indicators are captured at the point the starting information is declared on the PDS to the MA. Any appropriate Programme Specific and Common Result indicators are captured at the point the leaving information is declared on the PDS to the MA.

Scenario 3 Example:

A participant joins a single project with an operation but does not complete the planned activity and therefore leaves earlier than expected. The leaving date, and therefore the point to which immediate results indicators should apply, is always the date that the participant leaves the operation and not the planned exit date.

In the scenario above, a participant is interviewed and then referred to training.

In the first stage the participant is interviewed and referred a 3 months training scheme. The Output indicators on entry, refer to their situation on entry to the operation. So in this scenario it is their situation on the first day of the training scheme.

All information collected at interview and the referral point must be verified.

The participant joins a single project which in this case is planned as a 3 months training scheme. However, in this scenario they do not complete the planned activity as they leave at the end of month 2, 1 month earlier than expected.

The immediate results indicators refers to situation on exit from the operation. So, their actual leaving date, is always the date that the participant leaves the operation and not the planned exit date. The outcome can be reported, or updated should it change, within 4 weeks of the date of leaving.

Note for Youth Employment Initiative (YEI) supported operations, information about whether a participant completes the intervention or not is important for some of the YEI indicators (see section 5.10.1).

Guidance: EU ESF Annex D – Practical Guidance on data collection and validation refers.

18.5 Scenario 4 – Participant starts ESF intervention and all data is complete at point of starting, then leaves intervention early and leaving data is incomplete.

In this scenario, any appropriate Programme Specific and Common Output indicators are captured at the point the starting information is declared on the PDS to the Managing Authority. No Programme Specific or Common Result data can be captured as the leaving data is incomplete.

Note: Incomplete leaving data could include date of leaving. It is important that projects have a policy in place to establish an appropriate leaving date, for participants who leave their intervention early. For example, a participant does not attend a planned intervention and the project is unable to contact them. The project has a policy that provides for 2 planned interventions to be missed without contact. If the participant fails to attend the second intervention, the project will record the participant as a leaver.

18.6 Scenario 5 – Participant starts ESF intervention and data is incomplete at point of starting.

In this scenario, the participant will not count towards any Programme Specific or Common Output indicators.

Note: Participants falling into this category must still be declared to the MA on the PDS. The MA is required to provide a count of incomplete records to the European Commission (EC).

Guidance: Section 3.1.1 page 10 of the EU ESF Monitoring and Evaluation guidance refers:

There is no single common indicator in SFC capturing the grand total number of participants (including those for which the common output indicators covering personal non-sensitive data could not be collected). Nevertheless, this grand total number of participants shall be reported by the MA in the framework of the AIRs.

Section 2.3.7 of EU ESF Annex D – Practical Guidance on data collection and validation refers: Grand total of participants.

The “grand total of participants” covers all supported participants, including those for which the basic data (for example, the common output indicators covering personal non-sensitive data) could not be collected or are incomplete. This total should be reported in the last row of Table 4A of the AIR (see section 3.1.1 of the EC Guidance document on Monitoring and Evaluation).

18.7 Scenario 6 – Participant returns to an ESF operation, after previously participating in an intervention within the same operation.

In this scenario, any previous results relating to this participant are no longer valid. It is only possible to record the results relevant to the latest intervention.

Scenario 6 – Example

In the scenario above a participant is interviewed and then referred to training.

In the first stage the participant is interviewed and referred to language training. The Output indicators on entry, refer to their situation on entry to the operation, which is their situation on the first day of language training.

All information collected at interview and the referral point must be verified.

After 2 months the participant leaves the language training for 1 month’s employment. The date the participant left the language training is their original Leaving date. This is the original exit date.

When their one month’s employment finishes the participant re-enters an ESF operation. On re-entry, remove existing leaving date and associated immediate result data.

The participant then undertakes Skills Training and Further language training Leaving date. In this scenario, any previous results relating to this participant are no longer valid. It is only possible to record the results relevant to the latest intervention.

Record new leaving date (the date of last exit from the operation) and corresponding immediate result data.

Guidance:

EU ESF Annex D – Practical Guidance on data collection and validation refers: (Page 27)

1. For European Social Fund (ESF) projects outside London the Managing Authority is the Department for Work and Pensions. In London, the Greater London Authority, as an Intermediate Body undertakes a number of Managing Authority functions’. ↩