We’ve seen the advantages Lump funding presents, but now we’ll address its limitations. We will also give a series of recommendations for Coordinators dealing with Lump Sum grants.
1. The Budget May not be that Flexible:
While Lump Funding does allow for some budget flexibility, budget transfers between work packages necessitates mandatory contract amendments. This can delay projects. Compared to the 'actual costs' model with fewer amendments, lump sum flexibility might be more limited.
2. Administrative Strain During Application:
Moving administrative tasks to the grant application stage, requiring a detailed budget breakdown, has pros and cons. It allows better planning but may slow down applications. With Horizon Europe programmes’ low success rate, researchers might hesitate due to longer application times and funding uncertainty.
3. Non- Payment Risk:
Lump sum grants need Work Packages to be completed for payment. This condition can pose a challenge if the project encounters unexpected changes that affect its original implementation plan. If the project is not successfully executed according to the grant agreement, there is a risk that the lump sum funds may not be disbursed. This being said, data from last year's Lump funding pilot shows a 99% payment success rate.
With these limitations in mind, it's essential to acknowledge that the lump funding model is an evolving concept within the EC's framework. As time progresses and more experience is gained, we will better understand whether this model truly simplifies the grant funding and project management processes to the extent envisioned.
Tips for Lump Sum Project Coordinators:
Select Reliable Partners: Lump Sum project payments hinge on work package completion. Choose partners with a track record of consistent project execution.
Detailed Work Plan: Collaborate with participating beneficiaries to develop comprehensive Work Packages outlining tasks, milestones, and periodic reporting deliverables. Consider dividing lengthy work packages into shorter ones.
Regular Monitoring: Consistently monitor work package progress to ensure timely milestone achievement and payment.
Transparent Communication: Maintain open communication with partners about project goals and deviations for smoother workflow and enhanced collaboration.
Deviation Management: Develop strategies to address plan deviations, documenting justifiable causes in periodic reports. Address budget amendments as needed.
Engage with EC: Keep in touch with the EC Project Officer, especially for plan changes or adjustments.
Accurate Reporting: Ensure precise reporting of work package completion for lump sum payments.
Financial Oversight: Collaborate with the financial department to manage the budget and adhere to Lump Sum requirements.
Enjoyed this article?
Read the first two articles of this 3-part series on lump sum funding:
Also Explore
European Commission Guide: detailed guides, videos and briefs about lump sum funding.