EN ANNEX 1 of the Commission Decision on Support to sustainable Economic Modernisation Action Document for "Support to Economic Modernisation" INFORMATION FOR POTENTIAL GRANT APPLICANTS WORK PROGRAMME FOR GRANTS This document constitutes the work programme for grants in the sense of Article 128(1) of the Financial Regulation (Regulation (EU, Euratom) No 966/2012) in the following section concerning grants awarded directly without a call for proposals: section 5.3.1.1 1. Title/basic act/ CRIS number 2. Zone benefiting from the action/location 3. Programming document 4. Sector of concentration/ thematic area 5. Amounts concerned Support to Economic Modernisation 1 CRIS number: 2015 / 038-679 financed under the Development Cooperation Instrument Cuba The Action shall be carried out at the following location: Most of the Action will be executed in Havana; some activities are expected to take place in different Cuban provinces. Study visits or seminars can as well take place in the EU and other third countries. The Direction of the Action will be composed of representatives from Cuban institutions and the EU Delegation to Cuba, and will be placed in Havana. Some implementing tasks and activities will be entrusted to Fundación Internacional y para Iberoamérica de Administraciones y Políticas Públicas 2 (FIIAPP) and the European Foundation for Management Development (EFMD) that will work from their respective Headquarters Multiannual Indicative Programme (MIP) for Cuba 2014-2020 Sector 3 - Support to sustainable economic and social modernisation Total estimated cost: EUR 7,925,000 Total amount of EU budget contribution EUR 7,700,000 The contribution is for an amount of EUR 7,700,000 from the general budget 1 2 Hereafter referred to as The Action International and Ibero-American Foundation for Administration and Public Policies [1]
6. Aid modality(ies) and implementation modality(ies) of the European Union for 2015 This Action is co-financed by potential grant beneficiaries for an indicative amount of EUR 225,000. Project Modality Direct management: Grants Direct Award to the European Foundation for Management Development (EFMD) Indirect management: delegation agreement with Fundación Internacional y para Iberoamérica de Administraciones y Políticas Públicas (FIIAPP) 7. DAC code(s) 15110 Public sector policy and administrative management 15111 Public Finance Management 11110 Education policy and administrative management 11130 Teacher training 11182 Educational research 8. Markers (from CRIS DAC form) 9. Global Public Goods and Challenges (GPGC) thematic flagships General policy objective Not targeted Significant objective Main objective Participation development/good governance Aid to environment Gender equality (including Women In Development) Trade Development Reproductive, Maternal, New born and child health RIO Convention markers Not targeted Significant objective Main objective Biological diversity Combat desertification Climate change mitigation Climate change adaptation N/A SUMMARY Cuba is undergoing a process of gradual transformation The government's modernisation programme was set out in the 2011 'Guidelines for economic and social policy' (Lineamientos), a strategy identifying over 300 measures in the economic and social sectors. In 2014, the EC adopted a Multiannual Indicative Programme for Cuba, with an allocation of EUR 50,000,000 million for the 2014-2020 period. The action will mobilise EUR 7,700,000 of support to focal area 3: Support to sustainable economic and social modernisation. [2]
The general objective of this action is to contribute to the socio-economic development of Cuba. It aims in particular at accompanying the on-going process of economic modernisation in Cuba through the sharing of best practices and the implementation of measures for the modernisation of public administration, including improving the effectiveness of the tax collection process (extension to different provinces of the "Integrated Management System for Fiscal Administration" and creation of an interactive web application to improve the information provided to citizens), and promoting the use of modern management methods. The action is based on two EU-funded ongoing programs in Cuba: the EU-Cuba Programme for the Exchange of Expertise (January 2014 to July 2017, EUR 3.5 million) which has already supported over 50 activities involving near 900 Cuban public officials, and the FORGEC project (Strengthening Managerial Capabilities in Cuban entities, September 2013 - November 2016, EUR 2.2 million) which has already contributed to training over 120 executives. At the request of Cuban institutions, the present action will indicatively focus on topics already foreseen in the EU-Cuba Programme for the Exchange of Expertise (fiscal policy, statistics, local and urban development, economic planning and modelling, production chains, business development, foreign trade, foreign investment). It will also include thematic areas from the FORGEC project, such as university quality management, business management and the training of local development actors. In turn, this new Action will make it possible to include thematic areas that may gradually emerge and become prioritised as part of the economic modernisation process. The action will be implemented based on the main pillars of the aforementioned EU-Cuba Programme for the Exchange of Expertise: ownership and direction of the action by the participating Cuban institutions, a high degree of flexibility enabling a rapid adaptation and response to new emerging scenarios, and high quality standards, ensured by an optimal use of the resources invested by the different actors. 1 CONTEXT 1.1 Sector/Country/Regional context/thematic area Cuba has embarked on a significant process of economic modernisation under the impulse of President Raúl Castro. These are progressively opening the way to a more market-oriented approach within a centrally planned economy and to greater participation of new economic actors. This process of modernisation of the economic model took off in 2008 in the agriculture sector. At the end of 2010 some economic activities became eligible for self-employment and the reorganisation and modernisation of the public sector started. A comprehensive package of economic reforms was outlined in a strategic medium term paper called Guidelines of Economic and Social Policy of the Party and the Revolution ('Guidelines') that was widely consulted with the Cuban population, approved by the Party Congress in April 2011 and endorsed by the National Assembly in August 2011. The Guidelines reflected the political will to maintain social achievements, particularly in health/nutrition and education, whilst strengthening the economic situation. To achieve the latter [3]
measures aimed mainly at improving budget discipline and monetary stability (including currency unification); at increasing the country productivity based on more autonomous State Owned Enterprises and providing a greater space to foreign investors and to new local economic operators; and at reorganising and modernising the Administration at central and local level. The 7 th Congress of the Communist Party of Cuba, scheduled for 2016, will discuss the progress made as a result of the current Guidelines, and if need be, will adopt new guidelines for the following period. This process of gradual transformation will be further influenced by both the renewed ties with the US and the intensification of EU-Cuba political relations. Furthermore, the Cuban government has recently announced that it will facilitate access to the internet, which is highly significant in the framework of this Action, especially with regard to the modernisation of the public administration including the tax authority and the enterprise system. In this national and regional changing context, the present Action will allow the EU to continue to accompany Cuban institutions and quickly meet the training and equipment needs that may arise. 1.1.1 Public Policy Assessment and EU Policy Framework The main orientations of the abovementioned Guidelines consist of the following: Elaboration of a Development Plan up to 2030 including the strategic axis for growth and development. Introduction of some market elements while maintaining an economic model based on central planning. Guaranteeing sound public finances through, among others, measures aimed at restoring budget discipline and the implementation of a new tax law. Modernisation of the Public Administration. Support the growing non-state sector (cooperatives, the self-employed and others) including the access to credits, inputs and equipment. Guaranteeing food security through an increase of food production and promotion of local and renewable sources of energy decreasing external dependency in both sectors. Separation of State and entrepreneurial functions. Decentralisation of competencies towards provinces and municipalities and promotion of local development initiatives. Moving from a universal subsidies system based on products to a selective one for the more needed based on persons while guaranteeing universal access to education, health and pensions. Increasing the access to foreign investment through the development of a Special Development Zone (Mariel) and the implementation of the new foreign investment law. Improvement of the external balance: prioritising the substitution of imports and promotion of exports of goods and services. Unification of the two currencies: Cuban Peso (CUP) and Cuban convertible Peso (CUC). Ensuring the training of managers of the Public Administration, State enterprises and the emerging small private sector with emphasis in management and business related areas. [4]
In this context, the Action (as it is included in the MIP) is expected to assist Cuban institutions in the implementation of the abovementioned Guidelines, mainly by providing best practices and training by experts with "hands on" experience on related Public Policies implementation. 1.1.2 Stakeholder analysis Considering the transversal and overarching character of the current economic modernisation process involving all levels of the Administration, the Action is designed to be capable to react to specific demands that can contribute to the implementation of the Guidelines. Consequently, there is a wide range of stakeholders involved in the design, implementation and oversight of the Action. The Action will mainly involve the following actors: - The Ministry of Economy and Planning (MEP) the Ministry that heads the implementation of the Guidelines and the economic planning, and as consequence has a more integrated and holistic view of the Cuban economy will ensure the quality and coherence of all the activities to be carried out in Cuba and will coordinate those activities not specifically coordinated by MES. MEP will chair the Action s Steering Committee. - The Ministry of Foreign Trade and Foreign Investment (MINCEX) the Ministry coordinates, in addition to trade and investment, development cooperation liaising donors with Cuban government institutions, at national, provincial or municipal level. - The Ministry of Higher Education (MES) the Ministry in charge of methodologically leading and managing higher education in Cuba. It oversees the comprehensive training of the professionals, the postgraduate education, the activities of science, technology and innovation and their extension according to the demands of society. In addition, and particularly, it is responsible for training, among others, managers/executives for public administration, the private enterprise and the non-state sector, hence its coordination role for the university quality and management training component. - The National Office for Tax Administration (ONAT) - in charge of developing and implementing a new tax system that in the medium-term is expected to become a modern body that will facilitate the collection of taxes with the support of the new information technologies, and to foster the culture of taxation among citizens. - National Economic Research Institute (INIE) the research centre belonging to the Ministry of Economy and Planning. The INIE plays a key role in providing research for decision making. - National Statistics and Information Office (ONEI) - tasked with the collection and processing of statistical data to provide the country with information for decision making. It is important to point out that one of the consequences of the expansion of non-state economic operators will be the implementation of a sampling system for data collection. - MINCEX (Capacity-Building Centre, PRO-CUBA and Chamber of Commerce) It is a top priority to the Cuban Government to increase the export of goods and services and the [5]
implementation of the new foreign investment law as indispensable sources to succeed with the implementation of the Guidelines. The above Cuban institutions have formally confirmed their interest in continuing and extending both the EU-Cuba Programme for the Exchange of Expertise and the FORGEC project through the present Action. When relevant, non-state sector institutions and/or individuals may participate as direct beneficiaries of the exchange activities. This is especially pertinent in the present Cuban context as the State is trying to build relationships between the State and the non-state sector in order to implement certain public policies. Also, they may benefit from training on management. Given the purpose and nature of this Action, it is essential that this Action remains open to the participation of other Cuban institutions such as: - Sectoral ministries (e.g. Ministry of Agriculture, Ministry of Industry, Ministry of the Food Industry, Ministry of Energy and Mining, Ministry of Public Health, Ministry of Education) - Municipal and provincial governments (including the Office of the Historian of the City of Havana (OHCH) and its network of associated centres) - Central Bank of Cuba - Universities - State enterprises - Office of the Scientific Advisor to the State Council - Other specialised entities such as institutes, research centres, professional associations, etc. As well, the Action will involve Institutions and officials or experts participating from the Member States of the European Union (its ministries, universities, business schools, enterprises and other agencies), as well as from third countries. The direct beneficiaries will be the individuals benefitting from the exchanges and actors that will take part in the exchanges through the establishment of institutional ties on a more long-term basis. The indirect or final beneficiary will be the entire population of Cuba. 1.1.3 Priority areas for support/problem analysis The changes that are being implemented in Cuba have been considered as irreversible by national and international analysts and should allow, with a favourable regional context, for a stronger economy based on the development of strategic sectors. Laws on foreign investment and taxes should respectively improve the gross capital formation and the spending capacity of the government to maintain the social policies. The main challenges for the tax administration relate to the need to improve the tax culture in the country and to ease the collection process, to face the sudden increase in tax payers due to the open up to new economic activities in the country such as self-employed and cooperatives. [6]
The modernisation of the administration including the use of ICT and the need to attract and retain qualified staff within the public sector are challenges shared by the entire Public Administration in Cuba. Cuban University has many challenges ahead in order to modernise its management and accreditation systems and to offer to students the "state of the art" on the different disciplines. Besides of this, the Ministry of Higher Education together with the University has the mandate of training high level executives from public and private Cuban institutions on modern management techniques more oriented towards achieving economic results. The exposure of Cuban Public Administration to other experiences in Europe and third countries is considered as highly beneficial in order to better define and implement new public policies. This Action will provide a rapid response to training needs related to the abovementioned challenges. The areas of interest are all those included in the Guidelines for the Economic and Social Policy of Cuba where an exchange of expertise may prove to be useful for decision making, designing and implementing policies, and/or elaborating legislative norms, among others. Based on the above information and on exchanges with Cuban main counterparts, priority areas may include indicatively: Public Policies, Tax Administration, Statistics, Foreign Investment, External Trade, Renewal Energy, Global Chains, Quality management in universities, training in Management techniques in State and non-state administration, as well as others that may be identified in Annual Work Plans and agreed upon with the EU Delegation in Cuba. The Annual Work Plans will be drawn up by the participating Cuban institutions based on the same methodology used in the EU-Cuba Programme for the Exchange of Expertise and will include a detailed problem analysis of the thematic areas selected, an analysis of capacity-building needs, as well as the expected results and indicators for each thematic area. This methodology has proved to be the best suited for an Action of this nature in the present context. 2 RISKS AND ASSUMPTIONS Risks Risk level (H/M/L) Mitigating measures Insufficient interest on the part of Cuban beneficiaries in the exchange of expertise L The EU-Cuba Programme for the Exchange of Expertise and the FORGEC project have awakened the interest of the Cuban counterparts. For this to continue, the quality and usefulness of the activities must be maintained. [7]
Non-availability of qualified experts of the EU Member States or other countries, or non-diversified experiences that can lower the quality of the results of the Action Lack of coherence and prioritisation of the different activities; lack of a well-defined strategy in the ministries M M Although for the moment in the EU-Cuba Programme for the Exchange of Expertise and in the FORGEC project the participating experts have proved to be of good quality, there has been no great diversification of experiences per country and the private sector has not been well represented. In this Action, the entities in charge of identifying experiences (FIIAPP and EFMD) will look at further enriching their respective databases of experts. Such measures are already been undertaken under the two current on-going actions which should allow to have identified effective mitigating measures for this future Action. In the EU-Cuba Programme for the Exchange of Expertise this risk has been mitigated thanks to the direction of MEP and the use of Annual Work Plans. However, the existence of two governing bodies (MEP and MES) for the different activities of the present Action increases the risk. The measures to mitigate this are structured in four directions: - Continue to use the Annual Work Plans oriented to results - One of the institutions should guarantee the coherence and quality of actions at a transversal level - Establish a Steering Committee to coordinate all parties and guarantee the coherence and quality of all actions - Guarantee the coordination of each ministry by a high-level official. Deterioration of the political relation between Cuba and the EU L In the present context, where the signing of a Bilateral Agreement between the EU and Cuba is expected to take place in the short or medium-term, the risk would seem to be reduced, although it will depend on several aspects. [8]
Assumptions I. The terms of Reference with the Government are signed on schedule and the beginning of the Action is not postponed. II. III. IV. The Cuban government remains committed to the implementation of the Guidelines and maintains its interest on the Action. FIIAPP and EFMD work with the quality required. There is an interest on the part of Public and Private Institutions of the European Union and of third countries to provide expertise. 3 LESSONS LEARNT, COMPLEMENTARITY AND CROSS-CUTTING ISSUES 3.1 Lessons learnt The FORGEC project got underway in September 2013 while the EU-Cuba Programme for the Exchange of Expertise began in January 2014 (the first exchanges of expertise took place in June 2014). During this time, several lessons have been learnt that are listed below: 1. It is essential to count on a high degree of flexibility in order to quickly meet the needs of the beneficiaries in a changing context and be able to respond to opportunities to support the modernisation process. 2. It is important that the ministries involved ensure an adequate priority to the Action activities. 3. A management format where the Cuban institutions, working jointly with the EU Delegation in Cuba, are in charge of the direction and the strategy of the Action while specific tasks are delegated to the implementers (mainly identification and mobilisation of experts and provision of logistics) has guaranteed a great ownership, leadership and empowerment on the part of beneficiary Cuban institutions and a strict control of costs, as well as the creation of a relationship of mutual trust between the EU and Cuban counterparts, ensuring all-time visibility of the Action and of EU funding. 4. It is necessary to foresee how much the beneficiary Cuban institutions can absorb from the Action so they are not excessively overloaded with activities. 5. It is important that the indicators of the Annual Work Plans are used as a management tool by Cuban Institutions. 6. The qualifications and professionalism of Cuban officials (including teachers) participating in the EU-Cuba Programme for the Exchange of Expertise and the FORGEC project have guaranteed the success of their respective activities, therefore it is important to maintain the quality and relevance of Cuban participants. 7. Although difficult to measure, an important lesson is to value the relationships established between Cuban and foreign experts as result from the exchanges. [9]
8. Further efforts need to be made to ensure that experiences/experts from a significant number of EU countries are taken into account 9. This kind of interventions are a basis to facilitate policy dialogue on public policies and global challenges. It is important to note that lessons learnt from EU experience with EUROSOCIAL, Twinnings and TAIEX, where Quality Technical Cooperation is/was provided, based on the demand of the local authorities and adopting a peer-to-peer approach have been taken into account. 3.2 Complementarity, synergy and donor coordination As stated above, this Action is in part a continuation of the on-going Programme for the Exchange of Expertise between the European Union and Cuba. It also includes elements of the FORGEC project which is aimed at providing both quality standards to the Cuban university system and management training in State and non-state Administration. The proposed Action will also complement the first wave of EU-financed projects in Cuba and mainly projects focus on food security, capacity building, renewable energies and support to Public Administration. The Action aims to complement those projects by providing capacity-building in key sectors of economic modernisation. The proposed Action will also complement both EU regional and horizontal programmes in which Cuba has already participated, is participating or has expressed interest to do so, such as AL-Invest, EUROsociAL, ALFA, AlBan, Erasmus Mundus/Eramus + and Horizonte 2020. Regarding other donors, some initiatives include the provision of technical cooperation to Cuba. Technical cooperation has so far been provided essentially by Spanish, Belgian, Canadian, Japanese or Swiss cooperation. This cooperation has chiefly been provided in the areas of audit and finance, forestry, agriculture and energy. In addition, Cuba has a long-standing cooperation with several EU Member States in areas such as fight against drug trafficking (United Kingdom, France, Spain) or civil protection. Several of the above-mentioned donors, or some emerging donors such as Brazil, have indicated their willingness to support Cuba in its current modernisation process upon the country's request. The UN system, under its new framework of Cooperation with Cuba, intends to work in key sectors identified within the Lineamientos of the country such as service quality and sustainability of social programmes, development of productive sectors and their value chains, local development, sustainable energy, food security, environmental sustainability and disaster risk management. In Cuba, there is not a formal mechanism of donor coordination, being the preference of the Cuban Government to negotiate bilaterally with each donor, with a penchant for multilateral led-actions. The Cuban Ministry of External Trade and Foreign Investment (MINCEX) has the mandate to coordinate cooperation and liaise with other Ministries in order to set priorities and assist with the [10]
elaboration and implementation of programmes. Cooperation is recognised as a complement to the development efforts of the Cuban authorities. At the same time, the Ministry of Economy and Planning (MEP) ensures coherence and coordination at the national level, including coordination between the demand for support of the national administrations and the support offered by international cooperation, while ensuring that actions remain consistent with national priorities. Donor coordination will continue to operate through regular contacts (EU Cooperation Counsellors Working Group meet every 3 months) to exchange information on respective activities to ensure their complementarity and the division of labour. The participating Cuban institutions will provide coherence to the Action at the national level, ensuring that the addressed needs meet national priorities, as well as guaranteeing the coordination and complementarity of the cooperation activities in which they participate. 3.3 Cross-cutting issues Environmental considerations will be incorporated in the Action activities wherever relevant (e.g. the national strategy for climate change adaptation is implemented at local level and by sector). Exchanges specifically related to the environment or climate change may also be considered as it has been the case under the current EU-Cuba Programme for the Exchange of Expertise (use of renewable energy sources in agriculture production). The gender dimension will be also a cross-cutting component of the Action exchanges. Participation by women from both the EU and Cuba will be ensured. Gender equality is a declared objective both of the Cuban authorities and of EU cooperation and the gender dimension will be integrated in the different activities to be undertaken under this Action. In the event of a request from the beneficiary authorities, this may also be the subject of specific activities, such as seminars on gender perspective as a cross-cutting issue within the public administration, women s leadership at central and local levels or analysis of the impact of the reform on gender issues. 4 DESCRIPTION OF THE ACTION 4.1 Objectives/results The general objective of the Action, following the priorities established in the MIP 2014-2020 for Cuba, is to contribute to the Socio-Economic Development of Cuba. The specific objectives of the present Action are: 1. Accompany the on-going process of economic modernisation in Cuba through the sharing of best practices and the implementation of measures for the modernisation of Public Administration in areas of mutual interest Expected results: 1.1. Capacities of Cuban public administrations strengthened. [11]
1.2. Measures for the modernisation of Public Administration (both central and local) implemented. The provision of quality technical cooperation in key sectors will be based on demands and requirements of Cuban counterparts and focused on the reinforcement of the public administration's capacity to formulate and implement sound policies in the main areas of economic modernisation. At the same time, the exchanges thus supported will contribute to establish new and consolidate existing relationships between EU and Cuban public administrations. Possible actions under this objective include among others: identification missions, short- and medium-term technical assistance missions, seminars, workshops, congresses, studies, research (including graduate and post-doctoral research), study-visits and support to future informal or formal EU-Cuba dialogues on Public Policies and global challenges. Initiatives identified in the framework of Technical Assistance missions and/or Exchange of Expertise aimed to implement actions related to Public Policies may be supported. The experts' selection process will follow best practices from both the public and private sectors, maximizing the range of experiences from different Public Administrations, Universities and companies of the EU and third countries. The Cuban institutions will guarantee the quality and relevance of Cuban experts participating in exchange activities. Funding will be indicatively provided for: air fares, accommodation, per diem, bibliography, software, meetings, equipment and logistical support. 2. Effectiveness of the tax collection process improved through strengthening the National Office for Tax Administration Expected Results: 2.1 Capacity of ONAT strengthened. 2.2 Expansion of the coverage of the "Integrated Management System for Fiscal Administration in Cuba" to all the provinces and municipalities of the country. 2.3 Interactive web application providing better information and services to the taxpayer created and rolled out. 2.4 Data safety and protection enhanced. Previous exchanges of experiences within the EU-Cuba Programme for the Exchange of Expertise have evidenced the need for a centralised countrywide database making use of ICTs to support the dissemination of information and offer better services to the taxpayer as well as to improve fiscal control. In response to this identified need, a new technological platform named Integrated Management System for Fiscal Administration in Cuba was designed, and started implementation in 2015 as a pilot project funded by the abovementioned Programme, outcome which will represent [12]
an important milestone in the process of centralising fiscal data, and will very soon result in an informational website. The present Action intends to increase the coverage of the Integrated Management System for Fiscal Administration in Cuba to every province and municipality in the country, thereby contributing to the availability of better organised and higher quality fiscal information. The present Action will also support the transformation of the purely informative website into an interactive web application, offering a better user experience and facilitating the provision of fiscal services to the taxpayer. Possible actions under this objective include identification missions, short and medium-term technical assistance missions, seminars, training, workshops, congresses, studies and study-visits, development of the web-based platform, creation of required technological infrastructure, support on data protection issues. Funding will be indicatively provided for: air fares, accommodation, per diem, bibliography, software, meetings, equipment and logistical support. 3. Use of modern methods of management promoted Expected results: 3.1 Relevant results of the FORGEC project consolidated. 3.2 Best practices on academic management shared. 3.3 Creation of management training capacities in Cuba Possible actions under this objective include, among others, training and exchange of experiences on university management; monitoring of the University quality assurance systems already put in place under FORGEC;; sustainable continuation of the "Programa Eurocubano de Enseñanzas de Gestión" (PEEG) designed for Cuban managers; seminars and trainings organised in Cuban State companies and across sectors; complementary trainings and study visits in the EU partner universities and possibly also in some firms of interest for the Cubans. Funding will be indicatively provided for: air fares, accommodation, per diem, bibliography, software, meetings, equipment and logistical support. 4.2 Intervention logic Based on the assumptions that the Cuban institutions are interested in having this Action succeed, that the management format defined for the Action makes it possible to prioritise activities based on their strategic importance within the modernisation process of the Cuban economic model, that FIIAPP and EFMD properly fulfil their role, and that there are public and private institutions from the European Union and third countries interested in becoming involved in this Action. [13]
The experiences of the EU-Cuba Programme for the Exchange of Expertise suggest that all these assumptions hold true. Taking into account that the Cuban institutions are gaining experience on how to better take advantage of and benefit from the Programme for the Exchange of Expertise as well as the FORGEC project. The intervention logic suggests that this Action will continue to offer Cuban institutions and economic operators' relevant support and experiences that are of great importance in the present context and can be later adapted to its reality. The Action will support inter alia: a better definition of Cuban Development Strategies and Public Polices; a modern tax administration and statistic system integrating new economic actors; a better prepared trade and foreign investment operators to work in the changing economic context; a better preparation of Cuban professionals on current management technics and a modern University management system. 5 IMPLEMENTATION 5.1 Financing agreement In order to implement this action, it is not foreseen to conclude a Financing Agreement with the partner country, referred to in Article 184(2)(b) of Regulation (EU, Euratom) No 966/2012. 5.2 Indicative implementation period The indicative operational implementation period of this Action, during which the activities described in section 4.2 will be carried out and the corresponding contracts and agreements implemented, is 72 months from the date of adoption by the Commission of this Action Document. Extensions of the implementation period may be agreed by the Commission s authorising officer responsible by amending this decision and the relevant contracts and agreements; such amendments to this decision constitute technical amendments in the sense of point (i) of Article 2(3)(c) of Regulation (EU) No 236/2014. 5.3 Implementation modalities 5.3.1.1 Grant: direct award (direct management) Direct Award to EFMD (a) Objectives of the grant, fields of intervention, priorities of the year and expected results The role of EFMD will be to provide expertise on management through its unique platform and access to European business schools in favour of higher education institutions and also in those areas related to the Private Sector to which FIIAPP (see below) cannot optimally respond given its more public administration specialisation. [14]
(b) Justification of a direct grant Under the responsibility of the Commission s authorising officer responsible, the grant may be awarded without a call for proposals to the European Foundation for Management Development (EFMD). Under the responsibility of the Commission s authorising officer responsible, the recourse to an award of a grant without a call for proposals, in accordance with Article 190(1)(f) of Regulation (EU) No 1268/2012, is justified considering that the objectives sought with this Action require EFMD's technical competence and its degree of specialisation reached in the field of quality management for higher education institutions and business schools administrations. Specifically, EFMD will take full advantage of its strategic cooperation with HUMANE 3, which is a unique European network specialised in quality management for higher education institutions. In addition, EFMD has access to an extremely large pool of Deans and scholars/professors from Universities and Business Schools from all over the world, and specifically European institutions. For more specific topics, EFMD will tap in its pool of expertise to organise high-level training sessions for and by universities and schools of business management on very specialised topics (internationalisation strategies, business administration, use of technology to enhance teaching learning, entrepreneurship education, social responsibility, etc.). Moreover, EFMD has proved successful in implementing the FORGEC project together with the Ministry of Higher Education (MES) since 2013 in a very complex context after resumption of EU Cooperation and reorientation of the Cuban economic model. EFMD is a very respected and trusted counterpart for the MES. The latter sees its collaboration with EFMD as very strategic in the present context of political, social and economic changes in Cuba. (c) Maximum rate of co-financing The maximum possible rate of co-financing for this grant is 90% of the Action. In accordance with Articles 192 of Regulation (EU, Euratom) No 966/2012, if full funding is essential for the Action to be carried out, the maximum possible rate of co-financing may be increased up to 100 %. The essentiality of full funding will be justified by the Commission s authorising officer responsible in the award decision, in respect of the principles of equal treatment and sound financial management. (d) Indicative trimester to conclude the grant agreement Last quarter of 2016 5.3.1.2 Procurement (direct management) Not applicable 3 HUMANE, the Heads of University Management and Administration Network in Europe, was set up in 1997 with the aim of grouping all heads of university administration in Europe in a network devoted to professional development by sharing best practices. [15]
5.3.1.3 Indirect management with a Member State Delegation agreement with FIIAPP Specific tasks and activities will be entrused to the Fundación Internacional y para Iberoamérica de Administraciones y Políticas Públicas (FIIAPP) through a delegation agreement in accordance with Article 58(1)(c) of Regulation (EU, Euratom) No 966/2012. This implementation entails the preselection and mobility of experts, the logistics of the different activities and the procurement of equipment, inputs and visibility material. This choice is based on the specialization of FIIAPP on these kind of programmes (Twinnings, EUROSOCIAL), and specifically on the experience that is being acquired in the EU-Cuba Programme for the Exchange of Expertise. Cuban authorities explicitly endorse the continuity of FIIAPP as implementing partner. The entrusted entity would carry out the following budget-implementation tasks: pre-selection and deployment of European, Cuban and third countries experts upon request of Cuban institutions, logistics of activities in Cuba and outside Cuba, procurement of equipment, inputs and visibility material for the Action. If negotiations with the above-mentioned entrusted entity fail, that part of this Action may be implemented in indirect management with another Member State's Agency. The implementation by this alternative entrusted entity would be justified if they proof experience on public administration expert deployment projects. The alternative entrusted entity would carry out the same budgetimplementation abovementioned tasks. 5.3.1.4 Changes from indirect to direct management mode due to exceptional circumstances Exceptionally and in case that due to circumstances outside of the Commission's control the implementation of these actions cannot be possible under the envisaged modality in heading 5.3.1.1 and 5.3.1.3, it could be replaced by call for proposals and a supply contract. Hereunder is a description of how this Call for Proposals would be implemented: Grants: Call for Proposals (direct management) (a) Objective of the grant It is foreseen to organise a Call for Proposals with the aim of awarding one single grant contract, which will have as objective to provide relevant expertise on the areas prioritised by Cuban institutions through the preselection and mobility of experts, the provision of logistics for the different activities and the procurement of equipment, inputs and visibility material. (b) Eligibility conditions In order to be eligible for a grant, applicants must: be a legal person, be established in a Member State of the European Union or the European Free Trade Area (this obligation does not apply to international organisations), and be directly responsible for the preparation and management of the action with the co applicant(s) and affiliated entity(ies), not acting as an intermediary. [16]
(c) Essential selection and award criteria The essential selection criteria are financial and operational capacity of the applicant(s). The essential award criteria are relevance of the proposed action to the objectives of the call; design, effectiveness, feasibility, sustainability and cost-effectiveness of the action. (d) Maximum rate of co-financing The maximum possible rate of co-financing for grants under this call is 90%. In accordance with Articles 192 of Regulation (EU, Euratom) No 966/2012, if full funding is essential for the action to be carried out, the maximum possible rate of co-financing may be increased up to 100 %. The essentiality of full funding will be justified by the Commission s authorising officer responsible in the award decision, in respect of the principles of equal treatment and sound financial management. (e) Indicative trimester to launch the call Second trimester of the year n+1 (the calendar year following the Commission funding decision). (f) Exception to the non-retroactivity of costs Not applicable no retroactive coverage foreseen. 5.4 Scope of geographical eligibility for procurement and grants The geographical eligibility in terms of place of establishment for participating in procurement and grant award procedures and in terms of origin of supplies purchased as established in the basic act and set out in the relevant contractual documents shall apply, subject to the following provisions. In accordance with Article 9(2) (a) of Regulation (EU) No 236/2014 the Commission decides that natural and legal persons from the following countries having traditional economic, trade or geographical links with neighbouring partner countries shall be eligible for participating in procurement and grant award procedures: CELAC member states, United States and Canada. The supplies originating there shall also be eligible. The Commission s authorising officer responsible may extend the geographical eligibility in accordance with Article 9(2)(b) of Regulation (EU) No 236/2014 on the basis of urgency or of unavailability of products and services in the markets of the countries concerned, or in other duly substantiated cases where the eligibility rules would make the realisation of this Action impossible or exceedingly difficult. [17]
5.5 Indicative budget EU contribution Indicative third (amount in EUR) party contribution, in currency identified (EUR) Direct Management (Direct grant to EFMD 4 ) 2,000,000 225,000 Indirect Management (delegation agreemen with 5,700,000 FIIAPP) 5 - Sharing of best practices and the (3,800,000) implementation of measures for the modernisation of Public Administration - ONAT (Expansion of the coverage of the "Integrated Management System for Fiscal (1,900,000) Administration in Cuba" and Interactive web application) Total 7,700,000 225,000. 5.6 Organisational set-up and responsibilities In order to ensure that its activities are strongly appropriated and efficiently prioritised, the Action will be headed, coordinated and implemented by the relevant Cuban institutions in close collaboration with the EU Delegation in Cuba. Their responsibilities will include the preparation of Annual Work Plans and their discussion and approval together with the EU Delegation in Cuba. Likewise, the Cuban institutions will be in charge of the final selection of experts and experiences, and of ensuring that the objectives foreseen in the plans are fulfilled. FIIAPP and EFMD will support the screening, pre-selection and mobilisation of experts and study visits. They will also be in charge of the tender procedures and the corresponding signature of contracts for the provision of necessary equipment, inputs, software and bibliography, and will ensure the logistics for the events. In addition, FIIAPP and EFMD must guarantee that the following conditions are met: i) the required experiences are supplied in compliance with high standards of quality and origin; ii) equipment, supplies and logistical support are provided in an efficient manner, enabling Cuban institutions to focus on essential aspects. The Steering Committee will be composed of representatives from the EU Delegation, FIIAPP, EFMD and from every participating Cuban institution (see section 1.1.2), and will be chaired by the Ministry of Economy and Planning, the EU. It will meet at least twice a year, and ideally four times a year. 4 5 Refer to Section 5.3.1 for further detail Refer to Section 5.3.3 for further detail [18]
5.7 Performance monitoring and reporting The day-to-day technical and financial monitoring of the implementation of this Action will be a continuous process and part of the implementing partner s responsibilities. To this aim, the implementing partners shall establish a permanent internal, technical and financial monitoring system for the Action and elaborate regular progress reports (not less than annual) and final reports. Every report shall provide an accurate account of implementation of the Action, difficulties encountered, institutional changes introduced, as well as the degree of achievement of its results (outputs and direct outcomes) as measured by corresponding indicators, using as reference the logframe matrix (for project modality) and the Annual Work Plans. The Commission may undertake additional project monitoring visits both through its own staff and through independent consultants recruited directly by the Commission for independent monitoring reviews (or recruited by the responsible agent contracted by the Commission for implementing such reviews). The beneficiary Cuban entities will prepare results oriented reports for the Steering Committee. 5.8 Evaluation Having regard to the nature of the Action, a final evaluation(s) will be carried out for this Action or its components via independent consultants contracted by the Commission. It will be carried out for accountability and learning purposes at various levels taking into account in particular the fact that the Action must be evaluated with a logic of support to processes and not exclusively with log frame logic. In case a mid-term evaluation is not foreseen, the Commission may, during implementation, decide to undertake such an evaluation for duly justified reasons either on its own decision or on the initiative of the partner. The Commission shall inform the implementing partner at least 2 months in advance of the dates foreseen for the evaluation missions. The implementing partner shall collaborate efficiently and effectively with the evaluation experts, and inter alia provide them with all necessary information and documentation, as well as access to the project premises and activities. The evaluation reports shall be shared with the partner country and other key stakeholders. The implementing partner and the Commission shall analyse the conclusions and recommendations of the evaluations and, where appropriate, in agreement with the partner country, jointly decide on the follow-up actions to be taken and any adjustments necessary, including, if indicated, the reorientation of the project. Indicatively, one (1) contract for evaluation services shall be concluded two months after the end of the implementation period of the Action. The financing of the evaluation shall be covered by another measure constituting a financing decision, namely support measures under MIP 2014-2020 for Cuba. [19]
5.9 Audit Without prejudice to the obligations applicable to contracts concluded for the implementation of this Action, the Commission may, on the basis of a risk assessment, contract independent audits or expenditure verification assignments for one or several contracts or agreements. Indicatively, one contract for audit services shall be concluded after submission of the final report. The financing of the evaluation shall be covered by another measure constituting a financing decision, namely support measures under MIP 2014-2020 for Cuba. 5.10 Communication and visibility Communication and visibility of the EU is a legal obligation for all external actions funded by the EU. This Action shall contain communication and visibility measures which shall be based on a specific Communication and Visibility Plan of the Action, to be elaborated at the start of implementation and supported with the budget indicated in section 0 above. In terms of legal obligations on communication and visibility, the measures shall be implemented by the Commission, the partner country, contractors, grant beneficiaries and/or entrusted entities. Appropriate contractual obligations shall be included in, respectively, the procurement and grant contracts, and delegation agreements. The Communication and Visibility Manual for European Union External Action shall be used to establish the Communication and Visibility Plan of the Action and the appropriate contractual obligations. The communication and visibility measures will be executed by the implementation entities. [20]