Contents

Financing Procedure

Direct Payments

Indirect Payments

The aforementioned context is divided in the Dispositions for the Implementation of the CSF and in the Chapter 4.4 of Financing. In the System of Management and Supervision of the Operational Programs of the 2000-2006 CSF and exactly in Chapter 6 “ Management system of funds” there is an analytical description of the relevant procedures.  

Procedure of financing

The procedure of the financing – supervision of an Act, which has been incorporated in an O.P, includes the following stages:

1st Stage: Registration of the Act in the Program of Public Investments

2nd Stage: Financing the Final Beneficiary (direct-indirect payments).

3d Stage: Provision of financial information.

4th Stage: Collection and payment of community participation.

In the first stage, the procedure of registering the Act in the PPI starts with the Decision to Incorporate the Act in the OP.

The Managerial Authority makes the Decision of Incorporation, sends it to the Final Beneficiary and notifies the Financing Institution of the Act.

Based on the figures of the Decision of Incorporation (total budget, annual distribution) the Final Beneficiary contacts the Financing Institution (Ministry, Regional administration (local authority and prefectures) and suggests the registration of the Act in the respective Collective Decision (CD) of the Program of Public Investments.

The Financing Institution includes the above proposals in its annual planning and if the figures suggested by the Final Beneficiaries are the same as the ones approved by the Managerial Authority, it suggests to the Ministry of Economy and Finance to take the respective Collective Decision (S.Α.Ε.,S.Α.Ε.P., S.Α.Ν.Α.)

Once the competent ministry, region or prefecture submits the proposal, the Ministry of Economy and Finance registers the Act in the PPI and takes the respective Collective Decision. The registration in the PPI includes the following features of the Act, as these are stated in the Decision of Incorporation:

• The name of the Act’s Final Beneficiary
• The title of the Act 
• The O.P in which the Act has been incorporated
• The approved budget which is divided in national and Community public expenditure as well as its annual distribution
• The definition of the Act’s financing method (direct or indirect based on article 11 of L.2860/2000).

The Collective Decision is then communicated to the Financing Institution, to the Final Beneficiary, to the Managerial Authorities of the Operational Programs, in which are incorporated the Acts mentioned in the decision, to the Payment Authority, to the Ministry of Economy and Finance and to the Bank of Greece.
 
In order to avoid delays in the financing of specific acts, the procedure of pre-approval of an isolated act in the Program of Public Investments can be followed. The procedure of pre-approval follows all the aforementioned stages but concerns only one Act. 

Finally, if one or more of the Act’s features presented in the PPI changes, the registration in the PPI must be modified following the procedure that was described above.

The 2nd Stage concerns the procedure that must be followed for the financing of the Final Beneficiary.

The procedure depends on the type of financing, direct or indirect, according to article 3 of L. 2860/2000.
Direct payments are “the payments which are made to the contractors by the bodies of collective decisions, in order for them to produce work or to provide goods according in accordance with the current dispositions”. Indirect payments are “the payments of subsidies or financing of legal entities of the public or private law by the bodies of collective decisions”.

Direct Payments

In those cases the Final Beneficiary, following the requirements that have resulted in the context of the Act’s implementation, submits to the Financing Institution an application for financing. At the same time he communicates it to the Managerial Authority.

The Financing Institution can accept the request of the Final Beneficiary only if the Managerial Authority has given its concurrent opinion. The Managerial Authority gives its concurrent opinion following an investigation of the available Supervision Reports and sends it to the Financing Institution in due time.

Then, the Financing Body submits to the Ministry of Economy and Finance an application for financing by the Collective Decision.

Based on the application and the available limit of payments, the Ministry of Economy and Finance issues a Decision of Financing by the Collective Decision, which is then communicated to the Final Beneficiary, the Financing Institution, the General Accounts Office, the Bank of Greece and the Managerial Authority. If the Decision of Financing is different from the request of the Final Beneficiary, the concurrent opinion of the Managerial Authority is needed.

Taking into consideration the total credit provided by the Collective Decision as well as the submitted applications, the Financing Institution gives an order to the General Accounts Office and to the Bank of Greece to distribute the credits for each Act. 

Once the distribution of credits has started, the Final Beneficiary can start charging the account of the Act (project’s code CD) and signing checks to the contractors. The payments of the contractors are charged directly on the account of the Act’s Collective Decision (S.Α.Ε., S.Α.Ε.P., S.Α.Ν.Τ.)

These transactions are realized through the OPS and are immediately available to the Payment Authority, which supervises the smooth distribution of the financing.

Indirect Payments

In the case of indirect payments, the procedure of submission of the Final Beneficiary’s proposal to the Financing Institution, to the Ministry of Economy and Finance, as well as the financing by the Collective Decision and the distribution of financing to the Act’s CD code, are the same as in the direct payments. 

However, one difference is that the payment of the contractor is not done through the Act’s CD code but through the Final Beneficiary’s Account (cases of legal entities or special accounts) where all the money is deposited.

In that case, the Financing Institution gives an order of money transfer to the Final Beneficiary’s account, in order for him to make the payments. The transfer can be in the form of direct subsidy or of an increase of the share-capital in the Public Limited Liability Companies. The Final Beneficiary is obliged to provide the Managerial Authority with the account statement.

The PPI distributes the sums through the OPS. All the information regarding the distribution is available to the Managerial Authority.

The 3rd stage includes the provision of financial information by the Final Beneficiary and the updating on the Program.

In both cases (direct and indirect payments) the Final Beneficiary charges the expenses on the Act’s account and updates the Managerial Authority of the O.P with the use of the Monthly Reports of Expenses and the Quarterly Supervision Reports (Chapter P.1).

The Managerial Authority verifies the data and registers it in the OPS. It also registers the income produced by the implementation of the Act.  Moreover, the Managerial Authority checks the interest rates, which are produced at the level of Intermediate and Final Beneficiaries and registers them in the OPS. 

We remind you that some projects are classified by the ESPEL as projects belonging  to category (ii) and (iii). That means that the ESPEL must conduct a second inspection in order to confirm that the defective works have been repaired. Until that happens, the Managerial Authority does not undersign the payments of the respective subprojects and consequently these payments are not taken into account. If the classification of the projects does not change even after the second inspection, the procedure that is followed is the one described in paragraph 6 of article 6 of L.2860/00 and in the JD 907/052/2.07.03 of the National System of Financial Adjustments. 

The Managerial Authority must confirm to the Ε.U the validity of the figures. In order to do that it conducts several investigations and communicates with the Managerial Authorities and the EDEL. 

In the last stage, the procedure of the Act’s Financing and of the supervision of the payments by the Managerial Authority is completed. The procedures, which are, followed concern the submission of the application for intermediate payments in order to ensure the collection of the community participation.