P-BA how to..? Cash flows - Matching upper & lower level

Post 2027 (Interreg VII) Decommitment Performance-based approaches

We would like to invite you to the first working meeting within our work on Matching Lower and Upper Levels, focusing on the implications of the proposed post-2027 performance-based approach (PBA) for programme financial planning.

Under the proposed framework, payments from the European Commission to programmes (the upper level) would be linked to the achievement of milestones and targets rather than the reimbursement of project expenditure. Programmes would therefore need a new approach to aligning these inflows with payments to projects at the lower level.

The centre of gravity would shift towards timely project delivery. Projects would carry greater responsibility for delivering the agreed outputs and results on schedule, as their contributions would underpin the programme milestones and targets that trigger Commission payments. Delayed or incomplete delivery could therefore have financial consequences extending across the programme.

This creates a risk of a snowball effect: delayed achievement could postpone Commission payments while the programme still needs to finance ongoing projects. The resulting liquidity pressure could delay payments to beneficiaries, slow down further project delivery and push expected Commission inflows back even further.

Financial planning and risk management would therefore become central to programme design, call preparation and project selection. Programmes would need to consider both what projects can deliver and when their contributions can generate programme-level payments, while ensuring sufficient liquidity to support implementation.

During this first webinar, we will:

• Review the current state of knowledge and the main implications of the proposed financing model for programme cash flow.
• Explore risks arising from the timing of project expenditure, delivery, verification and Commission payments. 
• Discuss how programme design, payment arrangements and financial planning can help manage liquidity, reduce the risk of funding losses and avoid decommitment.
• Exchange views on your concerns, practical needs and possible solutions.

The meeting will launch a working discussion that will continue in 2027. Interact is also preparing a tool to support programme financial planning, and we invite you to help shape its development so that it reflects your experience and needs.