EU support for Innovation Procurement Lieve Bos European Commission DG CONNECT (Communication Networks) F2 unit ( Innovation )
Innovation Procurement Complementarity PCP & PPI PCP to steer the development of solutions towards concrete public sector needs, whilst comparing/validating alternative solution approaches from various vendors PPI to act as launching customer / early adopter / first buyer of innovative commercial end-solutions newly arriving on the market Applied R&D / Pre-commercial Procurement (PCP) Public Procurement of Innovative Solutions (PPI) Phase 0 Curiosity Driven Research Phase 1 Solution design Supplier A Supplier B Supplier C Supplier D Phase 2 Prototype development Supplier B Supplier C Supplier D Phase 3 Original development of limited volume of first test products / services Supplier B Supplier D Phase 4 Deployment of commercial volumes of end-products Wide diffusion of newly developed solutions Supplier(s) A,B,C,D and/or X Also normally multiple sourcing here to keep competition going Objectives: Price/quality products that better fit public sector needs Earlier customer feedback for companies developing solutions Better take-up/wider commercialisation of R&D results
Examples: EU funded PCP/PPI projects in ICT More info on: http://ec.europa.eu/digital-agenda/en/eu-funded-projects HEALTH THALEA (PCP) Tele-detection/care of ICU patients SILVER (PCP) Robotics ageing well DECIPHER (PCP) Services mobile health data NYMPHA-MD (PCP) Mental care for bipolar disorders UNWIRED-HEALTH (PCP) Mobile care for vaccination & heart failure STOP AND GO (PPI) Telecare for elderly with multiple conditions TRANSPORT CHARM (PCP) Traffic Management V-CON (PCP) Virtual road infrastructure modelling E-GOV Cloud for Europe (PCP) Cloud computing PREFORMA (PCP) Long term digital preservation ENERGY ENIGMA (PCP) Photonics City Lighting PRACE 3IP (PCP) High Performance Computing EDUCATION IMAILE (PCP) Personalised learning needs SAFETY SMART@FIRE(PCP) Smart Textiles ICT for fire fighters
Horizon 2020 support for innovation procurement CSAs and PCP/PPI Cofund actions
Forms of support Coordination and Support Actions (100% funding rate): Support only coordination activities e.g. for preparation of a PCP or PPI by a group of procurers (identifying common challenges among procurers, conducting open market consultations with industry before initiating a concrete PCP or PPI procurement etc) CSAs do not provide EU cofunding for an actual PCP or PPI procurement PCP cofund Actions (70% funding rate): Provides EU cofunding for an actual PCP procurement (one joint PCP procurement per action) + for related coordination and networking activities (e.g. to prepare, manage and follow-up the PCP call for tender) PPI cofund Actions (20% funding rate): Provides EU cofunding for an actual PPI procurement (one joint PPI procurement per action) + for related coordination and networking activities (e.g. to prepare, manage and follow-up the PPI call for tender)
PCP/PPI Cofund actions Participation Minimum of 3 independent participants from 3 different MS or AC, of which minimum 2 public procurers (buyers group) from 2 different MS or AC Public procurers are contracting authorities or contracting entities as define in the EU public procurement directives They can be complemented by other types of procurers that are providing services of public interest and share the same need to procure R&D or innovative solutions E.g. NGOs or private procurers Other entities may participate as direct beneficiaries on condition that they add value to the action, are not potential suppliers of solutions sought for by the PCP/PPI and have no other type of conflict of interest Assisting the procurers in the preparation, implementation and follow-up
Roles Beneficiaries Action contains beneficiaries that undertaken together the PCP or PPI procurement, the buyers group & the lead procurer Buyers group Procurers in the action that provide the financial commitments to undertake the PCP or PPI procurement Min 2 public procurers from 2 different Member States or associated countries Lead procurer Procurer appointed by buyers group to lead and coordinate the PCP or PPI procurement Third parties linked to beneficiaries E.g. Third parties (e.g. end-users such as fire brigade) putting resources (e.g. test sites, testers) at the disposal of the beneficiaries (e.g. the ministry of internal affairs that is the procurer for the fire brigades) to carry out the action Subcontractors Successful tenderers, selected by the buyers group & lead procurer as result of the PCP or PPI call for tender, to provide the R&D services (PCP) or innovative solutions (PPI). They do 'NOT' become partners in the MGA.
Eligible activities Preparation stage Preparation of one joint PCP or PPI procurement per action Open market consultation /verification of market readiness to meet procurement need If relevant to the action, other networking or coordination activities Outcome Agreed common tender specifications Joint procurement agreement Confirmation of commitment on availability of financial commitments to start PCP or PPI Execution stage Joint procurement of the R&D services (PCP) or innovative solutions (PPI) Implementation of the procurement contracts /payment of providers Assessment of the outcomes of the procurement Confirmation of 'after-pcp/ppi' strategy for dissemination/exploitation of results If relevant to the action, other networking or coordination activities
EU contribution Reimbursement rate direct costs: Max 70% of eligible costs for PCP cofund actions, Max 20% of eligible costs for PPI cofund actions Eligible direct costs to carry out eligible activities defined in WP include: - Price of the R&D services (PCP) or innovative solutions (PPI) procured (if procurement conducted in compliance with requirements in Annex E WP) - Eligible coordination and networking activities - May include in-kind contributions (e.g. third parties putting resources at disposal of beneficiaries e.g. for testing of solutions) - VAT is an eligible cost unless for beneficiaries that can deduct it Flexibility: Consortium may choose to use part of the Union contribution to increase the support to coordination and networking activities/budget for call for tender as long as the Union contribution does not exceed 70% (PCP)/20% (PPI) of the sum of those costs and the price of the call for tender/coordination and networking activities. Requested reimbursement for coordination and networking can comprise max 30% (for PCP) / max 50% (for PPI) of total requested grant Plus 25% for indirect costs. But, no indirect costs on the price of the PCP/PPI procurement or on 3 rd party resources not used at the premises of the beneficiaries Pre-financing: Yes, 1 st pre-financing at start project for costs for preparation stage, 2 nd pre-financing before execution stage for costs for rest (incl. call for tender budget)
Coming soon 7 October 2014 - Open Days workshop 07B12 (14h30-17h00) focusing on innovation procurement in healthcare sector Presentations from THALEA (PCP) and STOP AND GO (PPI) 26-27 November 2014 EU/Lombardy innovation procurement event with networking sessions in preparation of 2015 calls See http://ec.europa.eu/digital-agenda/en/innovation-procurement EU assistance for ICT procurers launching PCP/PPI procurements (contractor expected to start beginning 2015) Practical toolkit and local promotion/training how to do PCP/PPI Individual local assistance (incl. legal) to procurers that plan to start PCP or PPI procurements across all Member States New website (2014 ): http://ec.europa.eu/digitalagenda/en/innovation-procurement. Previous website pre-2014 info: cordis.europa.eu/fp7/ict/pcp/home_en.html
Background info Info from past Info Day on: Details PCP/PPI Cofund instruments Possible synergies with structural funds support How to prepare a proposal Proposal ideas from potential proposers, etc -> http://ec.europa.eu/digital-agenda/news/calls-eu-funding-opportunitiespre-commercial-procurement-and-public-procurement-innovative Interested to see an example of a successful proposal? Contact IMAILE PCP project: www.imaile.eu. IMAILE agreed to make its project proposal public as example for others. -> Note: this is an example of a proposal according to the FP7 proposal template (as IMAILE is an FP7 not Horizon 2020 project). H2020 proposal template for PCP Cofund actions is similar but not 100% the same.
Synergies with Structural Funds support for innovation procurement
Categories of possible synergies CATEGORIES OF POSSIBLE SYNERGIES BETWEEN H2020 AND ESIF ON PCP/PPI Joint or simultaneous use of funds Sequential funding Additional funding Alternative funding (H2020 and ESIF funding used in same project to co-finance different cost items) (ESIF funding the preparation and H2020 the execution of a PCP or PPI, or other way around) (ESIF funding complementary activities such as skills enhancement to use solutions purchased by a PPI funded by H2020) (ESIF funding good quality projects that could not be funded through due to lack of H2020 call budget)
Simultaneous use of funds: Possible scenario PCP Joint PCP carried out in the context of a H2020 PCP Cofund action: some procurers in the buyers group may receive co-funding from the ESIF for their contribution to the total PCP budget and others from H2020 for their contribution to the PCP total budget. By using ESIF Funds, procurers from less developed Regions could receive higher co-funding rates (up to 85%) to participate in a PCP/PPI called for by Horizon 2020 that is implemented by/in cooperation with procurers from more advanced Regions (up to 70% funding rate ). This scenario is applicable only if there is a clear distinction between budgets offered per OP and between expenditures co-funded by the ESIF (per OP) vs expenditures co-funded by H2020. Possible implementation - each R&D provider is paid pro rata by each procurer in the buyers group according to the share of each procurer's contribution to the jointly committed budget for the PCP. Condition for success : synchronization between the ESIF calls and the H2020 cofund action calls
PROCURER A (Less developed Region) PROCURER C Coordination, Preparatory etc. activities are co-funded by H2020 (CSAs) 100% CO-FUNDING RATE OR CO-FUNDS HIS CONTRIBUTION TO THE JOINTLY COMMITTED BUDGET THROUGH THE ESIF CO-FUNDING RATE up to 85% (for his contribution) EXECUTION OF ONE JOINT PCP PROCURER B (Transitional Region) CO-FUNDS HIS CONTRIBUTION TO THE JOINTLY COMMITTED BUDGET THROUGH H2020 CO-FUNDING RATE 70%(for his contribution) PROCURER D Coordination, Preparatory etc. activities are co-funded by the ESIF DIFFERENT CO-FUNDING RATE PER PROGRAM AND/OR PARTICIPANT CO-FUNDS HIS CONTRIBUTION TO THE JOINTLY COMMITTED BUDGET THROUGH THE ESIF CO-FUNDING RATE up to 60%(for his contribution) CO-FUNDS HIS CONTRIBUTION TO THE JOINTLY COMMITTED BUDGET THROUGH H2020 CO-FUNDING RATE 70%(for his contribution)
Simultaneous use of funds: Possible scenario PPI Joint PPI carried out in the context of a H2020 PPI cofund action: One procurer in the buyers group located in a less developed Region can be co-funded by the ESIF (up to 85% rate) to purchase the amount of innovative products he needs, and another procurer in another MS can be co-funded by H2020 (20% rate) to purchase the amount of innovative solutions he needs. This scenario is applicable only if there is a clear distinction between budgets offered per OP and between expenditures co-funded by the ESIF (per OP) vs expenditures co-funded by H2020. Implementation option 1: under a joint Framework Contract/Agreement which provides the joint technical specifications, separate specific contracts are implemented by the procurers according to their national law for the purchase of the amount of innovative solutions they each want Or Implementation option 2: the lead procurer launches one procurement procedure, awards all the contracts, but every individual procurer pays the invoices for the products he buys for himself Condition for success : synchronization between the ESIF calls and the H2020 cofund action calls
Coordination, Preparation etc. activities are co-funded by H2020 (CSA) 100% CO-FUNDING RATE OR Coordination, Preparation etc. activities are co-funded by the ESIF DIFFERENT CO-FUNDING RATE PER PROGRAM AND/OR PARTICIPANT PROCURER A purchases the innovative products he needs with the support of H2020 FLAT CO-FUNDING RATE 20% (for his contribution) PROCURER C purchases the innovative products he needs with the support of H2020 FLAT CO-FUNDING RATE 20% (for his contribution) EXECUTION OF ONE JOINT PPI PROCURER B (Less developed Region) purchases the innovative products he needs with the support of the ESIF in line with the objectives of the relevant O.P CO-FUNDING RATE up to 85%(for his contribution) PROCURER D Less developed Region purchases the innovative products he needs with the support of the ESIF in line with the objectives of the relevant O.P CO-FUNDING RATE up to 85%(for his contribution)
EIB loans for innovation procurement
RSFF (Risk Sharing Finance Facility) Annual Budget vs. Actual Costs Y4 Y3 Public Sector Tranche: Facility to finance peak & bridge financing requirements faced by committed partner countries Y2 Gap Costs Budget Y1-50 0 50 100 150 Peak Requirements/ Budget Programme The repayment of the public sector tranche is made through budgetary commitments of partner countries over the long term (5-30 yrs) Key Advantages: Meet peak & bridge financing requirements Provide contingency cover for cost overruns For large projects (min loan amount 7,5M) Example: Italy's national 170M PCP/PPI programme
Overview current (WP2015) Horizon 2020 calls Supporting Innovation Procurement
Calls for PCP cofund actions in 2015 (click on the blue text for hyperlinks to the call) ICT Work Program (Call deadline: 14 April 2015) ICT-24(d): Robotics in areas of public interest including healthcare ( 5M) ICT-08(a): Boosting public service productivity/services via cloud computing ( 9M) ICT-36: Call open to any area of public interest needing ICT based solutions ( 4M) Health Work Program (Call deadline: 21 April 2015) PHC-27: Selfmanagement of health and disease and patient enpowerment supported by ICT ( 15M total, expected 3-5M/proposal) Security Work Program(Call deadline: 27 August 2015) BES-03: Maritime border security: Light optionally piloted vehicles (and sensors) for maritime surveillance (no predefined total budget, expected 5-12M/proposal) Research Infrastruct Work Program (Call deadline: 21 April 2015) INFRASUPP-2(b): Scientific instrumentation for research infrastruct. (part of 14M)
Calls for PPI cofund actions in 2015 (click on the blue text for hyperlinks to the call) ICT Work Program (Call deadline : 14 April 2015) ICT-8(b): Boosting public service productivity/services via cloud computing ( 12M) ICT-20(d): ICT technologies for better human learning and teaching ( 9M) ICT-27(b): Photonics software defined optical networking for faster broadband by public network operators e.g. National Research and Education Networks ( 5M) Health Work Program (Call deadline: 21 April 2015) PHC-29: ehealth services ( 10M total, expected 1-5M/proposal) Transport Work Program (Call deadline: 15 October 2015) MG 8.3: Transport Infrastructure ( 13M) Research Infrastruct Work Program (Call deadline: 21 April 2015) INFRASUPP-2(c): Scientific instrumentation for research infrastructure (part of 14M)
Calls for Coordination and Support Actions in 2015 (click on the blue text for hyperlinks to the call) Security Work Program (Call deadline: 27 August 2015) BES-11: Information management, systems and infrastructure for civilian EU External Actions ( 1-2M expected/proposal, part of large call) DRS-18: Interoperable next generation of broadband radio communication system for public safety and security (no predefined max budget, part of larger call) Research Infrastruct Work Program (Call deadline: 21 April 2015) INFRASUPP-2(a): Exploring future use of joint PCP and PPI in research infrastructure (part of 14M call) Energy Work Program (Call deadline: 4 June 2015) EE-07: Enhancing the capacity of public authorities to plan, finance and implement sustainable energy plans & policies e.g. in buildings, mobility (no max total budget, part of big call, 1,5/2M per project expected) EE-17: Targeting min 25% higher-than available energy performance levels b) Preparing and supporting procurements by large buyers groups (no max total budget, part of big call, 1,5/2M per project) ICT Work Program (Call deadline: 14 April 2015) ICT-30(b): CSAs on Internet of things ecosystem / could address PCP (max 1M, 2015)
Quite some ICT related PCP-PPI calls ICT is pretty wide domain ICT covers Components and systems: embedded ICT systems, minituarisation / system integration, advanced thin large organic and large area electronics Advanced computing (e.g. customised and low power computing) Future Internet (e.g. smart novel Internet architectures and experimentation platforms, optical and wireless network technologies, cloud computing infrastructure and services, tools and methods for software development, web entrepreneurship) Content technologies and information management (e.g. big data handling, content handling and modelling, automatic learning language translation systems, creative industries / social media ICTs, ICTs for learning / teaching and gaming, multimodal natural computer interaction) Robotics Micro- and nano electronics, cross-cutting ICT KETs, photonics (e.g. (O)LED lighting) High Performance computing Cybersecurity / trustworthy ICT Human-centric ICT solutions
Backup Slides New May 2014 Provisions In public procurement directives and State Aid Rules on R&D&I
Difference PCP-PPI combination versus Innovation Partnership procedure Different streams to finance industrial R&D Deployment commercial volumes of final end-products 200 Bn/Y (2% GDP) Mainstream R&D funding routes not procurement based PPI PCP PPI combination no State aid: provides equally fair access to the procurement market for companies that finance their R&D through nonprocurement channels PPI enables Public procurement market PPI 2000 Bn/Y (20% GDP) 2,5 Bn/Y (0,025% GDP) Procurement of R&D PCP PPI combination therefore usable in most common situation with multiple potentially interested suppliers
Difference PCP-PPI combination versus Innovation Partnership procedure Different streams to finance industrial R&D Deployment commercial volumes of final end-products 200 Bn/Y (2% GDP) Mainstream R&D funding routes not procurement based New IP Procedure limits access to procurement market to only the company whose R&D was financed by the innovation partnership New IP Procedure therefore only to be used in exceptional situations of PPI enables unique / specialised products!!! (if no other potentially interested suppliers on the market) PPI Otherwise State aid foreclosing competition & crowding out of mainstream R&D investments Innovation Partnership Procedure 2,5 Bn/Y (0,025% GDP) Procurement of R&D Public procurement market 2000 Bn/Y (20% GDP)