economic selection

8/7/2019 Economic selection

1/23

OverviewProject Selection General Principles

Principal Appraisal TechniquesCost Benefit Analysis

Project Appraisal Scoring, Weighting,Ranking

Project Selection TransparencyIssues

Project Selection Selection Criteria


2/23

OverviewProject Appraisal

Project FinancingTendering

Project Management Role ofImplementing Body

Project Management IT BasedSystem

Project Reporting to MonitoringCommittee

Value for Money Definitions EIA


3/23

Project Selection General Principles

Programme and Measure Objectives

Economic Impact taking account ofDeadweight and Displacement

Financial Viability PPP and

productive Sector Projects Cost effectiveness

Environmental Impact

Impact on equality of opportunity

Impact on poverty

Impact on rural development


4/23

Principal Appraisal Techniques

Financial Analysis

Cost Benefit Analysis

Cost Effectiveness

Scoring ; Weighting ; Ranking Multi Criteria Analysis (M.C.A)


5/23

Cost Benefit AnalysisAPPLICATION KEY

FEATURES

LIMITATIONS

Essential todemonstratethe economic

costs andbenefits ofprojects fromthe perspective

of the nationaleconomy orsocial welfare

Comprehensive

Comparison ofcosts and

benefits,including non-market.

Treatment of

risk.Can includeestimation ofmultipliers

Impacts requirecommonmonetary

numeraireData demandscan beconsiderable

Can haveinadequatepolitical orsocial

acceptability


6/23

Project Appraisal Scoring,

Weighting, Ranking (SWR)

The criteria against which projects willbe appraised are identified

A weighting is assigned to eachcriteria based on importance (noweighting = equal value)

Each project receives numerical scoreagainst different criteria

Different project applications rankedagainst each other


7/23

Project Appraisal Scoring, Weighting,

Ranking (SWR)Criteria Score (0-5) Weight Revised

ScoreECONOMIC IMPACT

Contribute to OP Objectives

Impact on Employment

Risk of Deadweight

Risk of Displacement

Cost Effectiveness

NON-ECONOMICIMPACTContribution to OP Objectives

Environmental Impact

Impact on Equal Opportunities

Spatial Impact


8/23

Project Appraisal Scoring, Weighting,

Ranking (SWR)Criteria Score (0-5) Weight Revised

ScoreCommercial/Financial

Appraisal

Market Need

Projected Sales DemandFinancial Projections

Risk of not AchievingForecasts

Access to Matching Funding

Ability of Promoter to AchieveForecasts

Long-term ExchequerImplications

Scheme-Specific Criteria

Total Score


9/23

Project Selection Transparency Issues

Public Promotion

Eligibility Criteria Published Criteria for selection available Weightings for criteria available

Decisions made by Committee Conflicts of interest avoided

(Declarations)

Information given to unsuccessfulapplicants Competitive or queuing basis Appeals system in place


10/23

Project Selection Selection Criteria

Included in Operational Programme

Objectives Measure specific objectives

Economic Impact

Financial Viability Cost-Effectiveness

Horizontal Principles: Environment:rural developmentPoverty: Equality

Scoring: Weighting: Ranking


11/23

Project Appraisal Procedure

Idea

Initial contact

Business Plan / Formal Application

Site visit to project Appraisal by staff

Assessment by Evaluation Committee

Board decision


12/23

Project Appraisal Criteria for Assistance You must show:

that the project is commerciallyviableThat there is a market for theproduct or service

That adequate finance will beavailable to fund the projectThat the promoter has themanagement and technicalcapacity to handle the project

That the promoters tax affairsare in order and proper

company structure


13/23

Project Selection - Procedure

Initial call for applications 2 stage

process Assessement of Proposals

Initial review by Regional Tourism

Organisation Assessment and scoring of proposalsby Filte Ireland

Assessed by Filte Ireland

Assessment Committee Considered and approved by ProductManagement Board


14/23

Project Selection - Procedure

Short-listed applications complete detailed

proposal form Evaluation by Filte Ireland evaluation

team

Assessment Committee reviewrecommendations

Product Management Board consider approve, defer or reject


15/23

Procedure Monitoring & Evaluation

Monitoring of Programme at three levels

Implementing Agency Monitoring Committee level

National (NDP/CSF)

Grantee must retain all records and haveavailable for inspection

Retain records of account for 6 years

(Irish Law) Retain records 3 years following closure ofprogramme

Grantee must file annual financialstatements


16/23

Procedure Monitoring & Evaluation Grantee must file annual financial

statements Grantee may have to provide evidence ofsatisfactory management and financialcontrol procedures

Work must comply to all planningconditions Regular progress reports on work Security Deed of Covenant or Mortgage

Grant paid in two instalments Interimand FinalPaid eligible expenditureEvidence matching funds

Check no grant aid from other sources


17/23

Project Financing

Public Sector

Project provision included in annualbudget estimates of CentralGovernment Department

EU receipts also includedRecouped in arrears by Exchequer

following verification of expenditure


18/23

Project Financing

Private Sector

Project Approved in advance ofcommencement

Project payments made in arrears

on basis of verified expenditure(stage payments allowed)Balance of funding provided by

promoters own resources,borrowings or other equityinvestment

Equity and loan finance also

included


19/23

Tendering Quotations and Tenders

Up to 800 Two oral quotations800 to 8,000 Two written

quotations8,000 to 16,000 Three written

quotations16,000 to 32,000 Four written

tenders32,000 to 160,000 Full tender in at

least two regional newspapers and/ornational newspapers

160,000 and over Advertisement inOfficial Journal of EU and nationalnewspapers


20/23

Project Management Role of Implementing Body

Design of overall scheme

Seek applications by public advertisement Review and approval of project

applications received from projectpromoters

Ongoing monitoring of projects Reviewing progress expenditure, final

project costs and irregularity reports ifapplicable

Review, approval and payment of projectmanager payment claims

Prepare claims for Managing Authority on

to Paying Authority


21/23

Project Management IT Based System

Financial Control Systems

Financial Tables Physical Indicators

Annual Implementation Reports

Other Reports by period county, field ofintervention

Actual expenditure reports

Claims for draw down Payment details

Report on receipts and outstanding claims

Funds allocation, dispersal instructions


22/23

Project Reporting to Monitoring Committee

Introduction description measure,

commentary on progress Expenditure to date

Performance Indicators progress to

targets North/South Co-operation

Information and Publicity Requirements

Horizontal Issues Environment; GenderEquality; Poverty; Rural Development

Future Prospects

Adjustments required

Annexes


23/23

Value forMoney - Definitions Additionality: Measure of economic output

i.e. amount of project output compared towhat would have occurred withoutintervention

Deadweight: Opposite to additionality i.e.could project have proceeded withoutState Aid

Displacement: Activities that would orcould have been financed by the privatesector are displaced by publiclysubsidised activity

Cost-effectiveness: Projects selectedcontribute the largest amount possible topolicy objectives at the minimum possible

cost.

economic selection

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