H2020: Internal invoicing and other simplification progress
A new version of the Horizon 2020 Model Grant Agreement (MGA) will be published before the end of February. This will include important changes concerning internal invoices and also some improvements to how persons on contracts can be charged to Horizon 2020 grants. From the Commission point of view, the changes form part of the "second wave of simplifications", which are expected to be introduced by Commissioner Moedas in late February.
Internal invoicing
The new MGA will include a new unit cost option for internal invoicing, which will still have to be based on actual costs and established according to institutional accounting practice. However, it will now be possible to have some estimated elements and to group costs into one unit cost, rather than having to report costs in their respective categories. This is currently causing major issues, in particular when it comes to personnel costs for staff working in facilities, which are currently required to provide time records.
The unit cost for internal facilities and services will have to be based on actual costs, including for staff costs, but it will now be possible to include a percentage according to, for example, what a facility needs in terms of personnel effort to be run (e.g. two technicians need to be present to run a facility). Other eligible costs - provide they can be measured - include, for example, maintenance, depreciation.
However, the unit cost must not include any indirect costs, and will not be eligible to create a new institutional practice which is only used for Horizon 2020. The idea is to use institutional practice for establishing the unit cost, but the rate then needs to be corrected by stripping out costs which are not eligible under Horizon 2020, such as the indirect costs.
Examples and further detail will be provided in a revised version of the Annotated MGA, which is expected to be published soon after the new MGA. It is also expected that auditors will receive further training and guidance on this change.
Other expected changes
In addition, the new MGA will provide more freedom when it comes to the cost for natural persons working under a direct contract with the beneficiary other than an employment contract (article 6.2.A.2). Here, the Commission is planning to amend the current wording of the MGA to say that the cost for such persons is eligible as long as they work under similar conditions to those of a regular employee. In future, beneficiaries will have to show that where a person works on the grant who is not on the regular payroll, the person's work is still organised in a similar way. Teleworking might be possible as long as this is also something that regular staff have access to in an institution.
There are also changes planned to the additional remuneration option. This option is of interest in particular to the so-called EU13 countries (those who joined the EU more recently). Many of those countries have different pay structures, often based on additional remuneration aligned with how many funded projects and the type of projects researchers attract. The EU13 countries have been asking for changes to the MGA for a long time and are proposing the introduction of a separate unit cost or the possibility to use MSCA rates. This is not currently possible within the legal framework of Horizon 2020 and the Financial Regulation. The expected changes will allow for more costs to be included in the basic remuneration where beneficiaries do not use fixed salaries. The cap of EUR 8000 for the additional remuneration is not expected to be changed.
