101 UK Brexit Notes

Connemara Programme October 16 2018 pg. 98 Project Funding: European Civil Protection and Humanitarian Aid Operations (ECHO) Purpose This notice is to set out our offer to UK humanitarian aid organisations, which will allow them to continue bidding for funding from the core budget of the European Civil Protection and Humanitarian Aid Operations (ECHO) without undertaking unmanageable financial and programmatic risk. Before 29 March 2019 Article 7 (1)(b) of the Humanitarian Aid Regulation (Council Regulation (EC) No 1257/96) sets out that eligible non-governmental organisations (NGOs) must:  be non-profit-making autonomous organisations in a member state under the laws in force in that member state  have their main headquarters in a member state or in the recipient third country. This headquarters must be the effective decision-making centre for all operations financed under the regulation. Exceptionally, the headquarters may be in a third donor country This should not exclude UK organisations prior to the UK’s withdrawal, given that we remain an EU country until 29 March 2019. In addition, the Joint Report, published last December, recognises the eligibility of UK entities to participate in current EU programmes will be unaffected by the UK’s withdrawal from the EU until programme closure. UK-based organisations and individuals should be able to:  bid for funding  participate in and lead consortia until programme closure, and otherwise implement as normal all EU development programmes which are approved before December 2020. Despite this, European Commission contingency planning has had the effect of discouraging UK organisations from bidding for ECHO funding. ECHO appears to require UK organisations bidding for funds to undertake, in a ‘no deal’ scenario, the delivery of all programme outputs beyond March 2019 without ECHO funding, should they not decide or not be required to leave the programme. In addition, ECHO has inserted the below clause in their grant agreements with UK organisations: “For British applicants (non-governmental organisations): Please be aware that you must comply with the requirement of establishment in an EU member state for the entire duration of the grants awarded under this Humanitarian Implementation Plan (HIP). If the United Kingdom withdraws from the EU during the grant period without concluding an agreement with the EU ensuring in particular that British applicants continue to be eligible, you will cease to receive EU funding or be required to leave the project on the basis of Article 15 of the grant agreement.” This is discouraging UK organisations from bidding and in some cases EU delegations are encouraging them to step down. We are keen to resolve this issue as soon as possible; given that it sets an unwelcome precedent for the UK to make future contributions through ECHO. After 29 March 2019 if there’s no deal If the UK leaves the EU in March 2019 with no agreement in place, ECHO could therefore either require UK organisations to leave their projects or even terminate funding to UK organisations but nevertheless expect them to implement the ECHO project in full. Neither of these outcomes would be acceptable to the UK government. Implications The termination of funding by ECHO would leave organisations with existing grants with no other option but to either terminate projects early and abruptly, with high extraction costs and negative programmatic consequences, or to finance the remainder of the programme themselves. This risk is discouraging organisations from bidding entirely, and has had a significant impact on UK organisations’ access to ECHO funding for several months. They are losing access both to new grants, and grants which they have been successfully implementing for years. UK government offer To facilitate continued applications by UK organisations to ECHO, and to avoid early termination of programmes, the government commits to funding the post-March 2019 outputs of any programme funded from ECHO’s core budget, where a UK organisation is the lead consortium partner or sole implementer. This will apply only in a no deal scenario when ECHO terminates funding based on the clause quoted above at the time of the UK’s exit from the European Union. This commitment is subject to the following principles: Applicable funding:  this commitment only applies to new applications for ECHO funding between the date of this notice and 29 March 2019  the UK government will not reimburse any programme activity that was undertaken prior to 30 March 2019