The budget is the heart of any Horizon Europe project proposal. Since Horizon Europe Grant and application reviewers use it as a way to assess the overall quality of proposals and their work plans, creating a Horizon Europe budget with properly allocated resources can make the difference between the success or failure of your proposal.
In particular, budget information about activities, planned and personnel, provide reviewers with an in-depth picture of how the project will be structured and managed. Details of a Horizon Europe proposal budget usually reveal whether a proposed project has been carefully planned and if it's ultimately feasible.
With so much importance placed on the budget, it’s vital that the proposed Horizon Europe budget corresponds to the expected efforts and tasks defined in the work packages and the overall work plan.
Understanding the Horizon Europe budget sections
Horizon Europe proposals have the budget presented in two sections, Part A and Part B. Understanding what you need for each section is important to creating a successful budget:
- Part A is essentially a proposal summary, an application form that has to be filled out on the submission portal of the EC. This form contains a budget table that gives the totals for each partner and the total for the entire project. The table also includes the project’s direct costs and either the 25% flat rate for indirect costs (and entitled direct costs) or a special cost rate when applicable. The topic description indicates the expected grant for a specific project.
- Part B is the narrative part of a proposal that has to be uploaded as a PDF on the submission portal of the EC. It is the part where the project’s budget is described in great detail. It contains the description of work, work packages, as well as several tables about the budget, including the summary of staff effort, the description and justifications of subcontracting, purchase, and other costs.
Expert tip: You can write the narrative part of your proposal together with all partners using an online document editor EMDocs which is integrated into the EMDESK platform. Simply choose the Horizon Europe Proposal Template and all necessary budget tables together with other parts of the proposal will be automatically implemented into your proposal file.
What’s the Part A budget table?
The electronic form of the budget table in Part A displays a summation of the overall budget. It presents the total figures for each partner for the duration of the project broken down by cost categories. It’s essentially an overview of the overall budget, an example of which you can see in the image below:
Expert tip: In most case you will have to enter the figures for the first 5-6 columns (the other columns will be auto calculated based on this data). If you develop your budget using EMDESK solutions, you do not need to calculate these numbers – the totals per partner and cost category are presented in EMDESK at any time and you can easily copy them to fill out this table:
What’s the Part B budget table?
Part B, section 3.1 of the proposal, is where detailed information of the budget must be presented starting with the Description of work for each work package. Since the Description of work is both a case for and justification of the budget request, it’s important that it shows the goals of that work package, what expectations need to be met, how the partners will meet these goals, and how they contribute to the overall goal of the project; in a way that’s reasonable, transparent, relevant to the research proposal.
The main text is further aided by four tables that further detail the proposed budget. These are:
- Summary of staff effort, Table 3.1f
- Subcontracting costs descriptions and justifications, Table 3.1g
- Purchase costs, Table 3.1h
- Other costs categories, Table 3.1i
What’s the Summary of staff effort, Table 3.1f?
This table displays a summary of the person-months assigned to each partner for each work package. It needs to match and summarise the information provided in the work packages and their descriptions so it’s important to pay attention to any deviations during the editing process of the proposal.
These costs will make up the bulk of data that you’ll get from partners regarding the work packages.
Expert tip: Project management solutions like EMDESK allow for the budget to be created by all partners in one place, in real time, so you won’t have to worry about gathering information from partners from multiple sources and you can be sure the information you have is the latest and most accurate numbers.
A calculation of personnel costs consists of the average monthly cost of employment of the personnel who are expected to participate in the project for each partner. This average monthly cost of employment needs to also include the salaries of personnel and any other payments made from the employer for these personnel, such as pension, social benefits, bonuses, etc. While it’s unnecessary to fully break down the salaries and additional payments, it’s important to give the average costs necessary for their employment. Generally speaking, these figures are provided by the finance department of each partners’ company or institution.
Specifically assigned number of person-months per work package is the amount of work assigned to each partner based on the role and tasks they’re expected to take in the work plan. These details should become clear in the discussion process of the work packages when each partner estimates how many person-months they need to for each task they’re involved with in the work packages.
Once these have been assigned, the total person-months per partner should be calculated. The total personnel charge per partner is that partner’s average cost of employment, multiplied by the total of person-months.
Note: There will be two different calculations in the pre and post award phase. The pre-award and evaluation phase will use the average cost of employment and how many person-months are assigned to each partner. In the post-award phase, the personnel calculation will be based on the daily rate, which you’ll need to make sure you watch carefully throughout the project as it may be audited later by the EC.
Note: Since pre and post award calculations are made differently there may be some discrepancies between personnel charge calculations. Solving these discrepancies requires you to consult the financial departments of your partners in order to get their backing and approval of the personnel budget both for the pre-award and the post-award stages.
What’s the Subcontracting costs descriptions and justifications, Table 3.1g?
In this table, reviewers will be able to see how much each partner plans to spend on subcontracting, along with a description and justification of these costs. This table helps to provide transparency, so it’s important that each partner describes the tasks that they plan to subcontract and offer a reasonable justification for subscontrating these tasks and the costs associated with them.
What’s the Purchase Costs, Table 3.1h?
Here reviewers can find detailed information and justifications for purchase costs for each partner. Purchase costs must fall into one of the following cost categories: Travel and subsistence, Equipment and/or other goods, and Work and services.
Important tip: The rule for this section is that each partner needs to detail and justify purchase costs that total over 15% of the personnel costs assigned to that partner. Any remaining purchase costs that fall below the total of 15% of personnel costs can be described in this section without the need to provide justifications.
What’s the Other costs categories, Table 3.1i?
There are several ‘other costs categories’, in addition to the ones mentioned above, that can be added to the Horizon Europe project’s budget. If one of these other cost categories is relevant to your project, a justification under table 3.1i should be provided. Keep in mind that most of these ‘other costs categories’ cannot benefit from the addition of the 25% flat rate of indirect costs.
To see more information about Part A and Part B of a Horizon Europe budget click here.
Creating a Horizon Europe budget proposal that will impress the reviewers
In the same way that a building needs a good foundation before building can start, your proposal will need to have a solid structure before the task of budgeting can begin. Therefore, the first step in writing the budget isn't to focus on the details of the budget, but to step back and look at the project’s objectives and goals. These will help you make sure that you have a solid project work plan developed that can serve as the foundation of your budget.
When writing your Horizon Europe proposal, you’ll need to first introduce the project’s overall goal, and then detail its objectives, concept and methodology, and its expected impact. Once these are defined you can work on creating a more detailed work and implementation plan. This will form the framework of your project. With all this in place, all the stakeholders will have the information they need to propose a budget and the resources required for the implementation of their activities according to their responsibilities. The final step in this process will be putting all this information into a Horizon Europe project budget presentation and requesting a grant using the online portal.
Here’s our tips and tricks on how to streamline the process and create a winning budget proposal.
Tip 1. Choose the appropriate tool to collaborate on budget creation
The best way to efficiently build consensus and ensure efforts and budgets are smoothly and efficiently allocated, is by using a project management solution, such as EMDESK. EMDESK has powerful budget planning tools specifically designed for the Horizon Europe Programme. It provides everyone with a real-time overviews, enabling you to design, update, and optimise a solid financial and resource plan with maximum funding. Budget planning in EMDESK provides you with a single solution to:
- Prepare your project's budget based on pre-built Horizon Europe templates
- Work together with your all your partners in real-time in one central space
- Plan efforts and estimate each partner's budgets with precision and certainty
- Customise budget planning and organise finances to your specific needs
- Get all the budget and effort information you need for Part A and B of the proposal
Tip 2. Stick to one of the following approaches: Top down or Bottom up
Both approaches for creating a budget have their advantages and disadvantages. The trick is to pick one method of budget creation and to stick to it. Changing the method of budgeting during the process can lead to complications and misunderstandings. Generally the project coordinator will indicate which method they think is best for the project and everyone should follow this recommendation to avoid bottlenecks and confusion.
Using this method the total project budget is divided many times, but equally between the project’s partners. Once each partner knows what this budget is, they’ll be asked to create and detail their own budget within the limits of their allocated share.
This method is easier for most coordinators because the bulk of the responsibility for budget planning is with the partners. The problem is that by dividing the budget in this manner, it can create a budget structure that may not be accurate and realistic given the requirements of the grants. This happens when the budget doesn’t reflect the expected efforts of each partner in the project. It’s important to note that reviewers might perceive a budget presentation as overly simplified and therefore not in line with a solid implementation plan.
This method asks partners to give a detailed analysis of their budget they’ll need in order to successfully complete their project tasks. In this case there are no predetermined budget limits. Once the budget analysis from the partners is collected they are used to form the overall budget for the project.
Since this method considers the actual needs and efforts of each partner, it creates a more accurate and realistic Horizon Europe project budget description. Finding consensus requires more effort, but it allows for greater opportunities for partners to really understand the project and enhances the project’s chance for a successful evaluation. Demonstrating the exact role of each partner and the division of work needed to implement the project’s work plan gives reviewers that everyone is aware of their responsibilities and will be able to meet both their individual and overall project objectives.
Tip 3. Understand the expectations of project evaluators
A successful budget will meet the expectations of its evaluators and prove that the budget and its funding are in line with the project objectives and goals. A strong budget proves that you’ll be able to effectively and efficiently manage funding in a way that successfully accomplishes the project goals. You’ll need to demonstrate to funders that you’ll be able to stay on target and follow through with your objectives; basically that your project is worthy of their support. The best way to do this is to make sure that costs are reasonable, transparent, allowable, and related to the research proposal.
This article is written by Stefan Detschew, Chief Technology Officer at EMDESK.