The Project Rating as a tool to facilitate the activation of the Recovery Plan (PNRR)
20th May 2021
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Editor: Fabrizio Calabrò Massey
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Introduction
The Recovery Fund has been declined in different definitions and acronyms, Recovery Plan, NGEU New Generation Europe, PNRR National Recovery and Resilience Plan, so that the simple European citizen is not always able to understand what the different terms used contain, but nevertheless has a simple and clear purpose, easily understood by anyone:​ "with the Recovery Fund, the European Community makes available to European Nations substantial Funds of money with which Projects capable of overcoming the economic crisis generated by the Covid-19 pandemic will have to be carried out".
​An idea that was transformed in a short time in a will of all European countries, demonstrating that if you want, the European Institution is a "good thing" and especially very useful for the people of individual states.
However, passing from this idea/will to concrete facts is not a simple matter; indeed, it is precisely in this passage towards concreteness that difficulties arise and grow, for which it is necessary to seek solutions that have only one end, overcome this economic crisis without ifs and buts.
What we want to talk about here is what concerns the technical-procedural aspects related to the activation and realization of the Projects, proposing the Project Rating as a tool to facilitate the activation and use of the Recovery Fund (PNRR).
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Recovery Fund and Project Rating
As it is now known, the Recovery Fund is composed of a list of projects to be submitted for funding called Recovery Plan (PNRR), which, due to the number and complexity of the interventions, generates a series of "problems" in terms of how to activate the individual project, so much so that if not resolved, they may jeopardize the availability of funding granted in the first instance by the European Community.
​In fact, many are the "issues" that create "problems" and that must be the subject of attention and care by the competent bodies, but among these two are the main ones in the opinion of the writer:​
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the quality of the Projects for which funding is requested,
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the actual ability to finance the Project​
On these two points the Project Rating can provide solutions able to overcome the mentioned problems.
​The first step: the authorization to finance the single Project
​First of all, it must be said that the activation of the Recovery Fund requires compliance with a precise authorization process that starts with the presentation of individual projects and is articulated in the subsequent phases, in all those technical and procedural aspects that have the task of verifying the consistency of individual interventions with the objectives set out and described in the documents mentioned above, Recovery Plan (PNRR), up to the "approval" of funding.
​What is the type of "approval" to the financing by the European authorizing bodies is a matter of great discussion and by some even of "interpretation", the fact is that without this "feu vert" the financing is not granted and the Project does not start.
​Therefore, it will be necessary to follow, in a form at least agreed upon by the Parties, the authorization process indicated above, whose first step, which is also the most difficult and priority activity, consists in presenting the Project to be financed only after having carried out an accurate programming and planning of the interventions, activities that are the exclusive competence of the State Offices in charge, both central and peripheral.
​However, the technical and design methods that will be adopted in this phase, also defined as pre-feasibility of the work, will not always be able to foresee an in-depth study of the design components, given the complexity of the interventions foreseen and the urgent nature of receiving the first funds, for which many (the majority) of the Projects included in the Recovery Fund (PNRR) will be identified by adopting the principle of priority of intervention assessed on a political-social basis.
​Proceeding in this way, however, it is clear that the verification of the real compatibility of the individual project to the specifications and objectives agreed with the European Control Authorities, can be carried out only after the approval of funding and this will lead to many problems of "adjustment" and "correction" of the multidisciplinary content of the project, activities that if not done in a shared form and in a "tight" time, may put in difficulty the regular start of the funding process imposed by the EU.
​In addition, correcting the authorization of EU Funding after the fact involves two additional difficulties.
​The first is inherent to the "disbursement" of the first tranches of funding that must be received as soon as possible to be able to quickly start the economic process, but this is feasible only if the funded Projects have passed the screening of the "updates" agreed with the EU.
​The second relates to "project mismatch" understood as old and new funded projects having different prevalent impacts.​
In fact, it is likely that the old projects, even if financed, contain as a criticality prevailing aspects of bureaucratic-administrative nature that have delayed the implementation in time, while the new projects are found to have as a criticality prevailing the absence of the positive verification of the territorial-environmental and social impact, due to the obvious speed of proposal that has not allowed to carry out the complete and correct checks of the case.
​But all these difficulties are nothing more than criticalities which, if not managed correctly and promptly, generate risks in their negative sense, hence the need to adopt tools capable of predicting and managing the evolution of criticalities into risks.​ Project Rating addresses this relationship.
​The second step: design
​The second step consists in the design according to defined design phases, Feasibility, Definitive, Executive, the development of which is necessary to ensure the assignment of the work in compliance with the rules that each State has given itself, which for Italy is the Procurement Code, D.LG.S. 50/2016 and subsequent additions.
​Now, if it is necessary to develop the projectual content by drawing up the different phases of the design in a reasonable amount of time and if we add to this the many procedural and bureaucratic delays that in Italy are the real "vulnus" of public investments, we come to the banal conclusion that the period granted by Europe to be able to use (i.e. spend) the funding provided, is too short compared to the duration of the ex-ante design phase only.
​It is therefore clear that the only solution is that of administrative and bureaucratic "simplification" which should lead to an acceleration (desirable but not expected) of the time required to prepare the project documentation, including all the necessary authorizations and waivers to proceed.
​Among the solutions proposed for simplification, there is the use of Commissioners intended as supervisors and/or guarantors of the correct and regular progress of the project, in addition to the many figures in charge of the Project today and in any case not replaceable.
​After careful consideration, it appears that the Commissioners' proposal, at least as defined today, does not appear to be a winning solution and in any case does not appear to be the best one to meet the Recovery Fund's needs, as there are many objections to be made.
​The first observation is in order to the numbers of assignments; It is unthinkable that every Recovery Plan project should have a Commissioner, with a 1:1 ratio, given that there are tens of thousands of projects, both large and small.
​The second observation is that an additional figure of project responsibility would be introduced, which would distort the current chain of competences, which today foresees the RUP, the Designer, the Superintendent, the Tester, the Project Construction Manager, each with precise roles and competences that cannot be substituted or overlapped; this would imply instead of a "simplification" an increase in "complication" generating serious difficulties in the identification of the exact responsibilities of the Project, slowing down the progress process instead of accelerating it.
​The third as a consequence of the previous and perhaps most important, is the lack of clarity in the assignment of responsibility for the role assigned to the Commissioner.
​In fact, it is not clear whether the role of supervisor and guarantor of the Project assigned to the Commissioner also means the assumption of responsibility for the quality of the Project as a complex system.
​To such purpose, it is necessary to remember that the quality of the Project, does not have to be interpreted exclusively like ability of the Technicians to produce elaborated progettuali in a position to containing the best technical solutions, (Italy has the best Technicians planners graduates in the best Polytechnic Universities and of Engineering recognized to international level) but like result of the complexity of the Project composed from the many interdisciplinary components which, technical-design, economic-financial, environmental-territorial, administrative-bureaucratic, corporate and civilistic budget, etc.
​In this regard it is worth remembering that the quality of the Project, at least as indicated above, is sought and obtained only by applying precise methodologies of Project Management and Risk Management, where the focus is on the ability to highlight the criticalities of the Project that produce risk.
​If this is the case then the Commissioner should be more framed in the role of Project Construction Manager - and this in itself would not be negative, although as mentioned it would duplicate a function usually already provided in large Projects.
​But what is missing, at least up to now, is to give the role of the Commissioner a meaning exclusively of single Professional, even if expert and referenced, without highlighting the obligation of specialization in Project Manager (many are the Commissioners chosen in the political class) and especially without specifying with which tools and methods the Commissioner must ensure the quality of the Project.
​In the absence of these clarifications, it therefore seems that proposing the Commissioner for each project as a simplification is more of a "procedural shortcut" than in reality it does not represent with due professional seriousness the solution to be proposed to Europe in exchange for the granting of funding.
​After all, this is what Europe is asking for, by making available large sums of money, i.e. to make good projects that meet interdisciplinary evaluation requirements, because this is the only way to start economic growth capable of increasing GDP and this is what must be done.
​Therefore, if simplifying the planning process is an obligation, then carrying out a project of quality is also an obligation.
​The Project Rating is the tool by which a quality project is made possible.
​The third step: realization
​The third step concerns the realization of the financed Work that involves a "monitoring" activity of the progress of the construction site by means of which it must proceed to a precise and accurate control of the two parameters that measure the real success of the Project and precisely the respect of the costs and that of the times both defined and agreed upon during the authorization and concession of the financing.
​It goes without saying that if these two parameters are not respected, then the financing tranches to SAL of the work could be jeopardized by Europe, thus generating evident financial criticality due to the high volumes of money in circulation, so as to generate a negative impact on the state budget.
​Therefore, the ability to provide valid and timely updates on the status of the two parameters, cost and time, is a very important control activity for funding disbursement.
​But precisely because both are the result of an articulated management process of the Project implementation phase, it will not be easy to always meet expectations, also taking into account the large number of Projects that will be launched and above all their complexity.
​Setting up a valid and effective cost and time control process means entering into the risk analysis by adopting a mitigation strategy that has a strong impact on the conduct and management of the Project.
​After all, it is no longer weighable to realize Opere in great number and with highly innovative technological contents using only the classic basic tools of the Project Management without adopting the Risk Mangement as focus of the forecast of the yard and this involves a change of mentality not only by the Technicians but also (and above all) by those who have to relate with the European Organs of control in charge of the disbursement of the granted financings.
​The Project Rating provides the tools to address this need to manage the work with application of Risk analysis.
The fourth step: restitution
​The fourth step involves the repayment of a large part of the funding provided by the Recovery Fund, on very advantageous terms for the users, although it must be remembered that the repayment of funding is an obligation and this must be possible without incurring further social debt.
​In other words, it will be necessary to draw on the surplus of GDP produced thanks to the virtuous process triggered by the Recovery Fund, financing good projects, for which doing quality projects is an absolute that cannot be ignored in any way.
​But if this "turn of phrase" is nothing more than a goal that becomes imperative, then one has to wonder:​
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will we be sure that we are all doing quality projects that can contribute to GDP growth and make positive use of the Recovery Fund opportunity?
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Will the professionalism and experience that can be brought to bear be sufficient as the only tools capable of delivering good Projects?
These are complex questions that require answers that are not always convincing, but there is certainly an awareness that a "change of gear" is needed.​
In other words, it will be necessary to combine the skills, which are certainly high and widespread, with new tools and methods of management and planning of Projects that allow to introduce the concept of the "probability" of occurrence in a sector where "pragmatism" and "realism" is the basis of a centuries-old culture of the Construction sector, both Public and Private.
Introducing the "probability" as a tool for evaluating and forecasting the performance of the Project both in the ex-ante and ex-post phases, must become a shared operating method, to be adopted as a reference method to ensure the repayment of funds obtained.​
This will only be possible by introducing Project Risk analysis to support the Design and Execution activities of the Work.​
The Project Rating adopts the analysis of Risk as a principle as a basis for evaluating the interdisciplinary content of the Project and its application makes it possible to predict compliance with the repayment of the Financing obtained.​
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Conclusions
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The Recovery Fund is a unique opportunity that Pandemic has brought us, turning a threat, the economic crisis, into an opportunity, the start of a healthier economy.
​It seems strange but so it is, and it is up to us to our ability and intelligence to make the most of this opportunity.
​Having a lot of financial liquidity allows the realization of many projects, it means transforming an idea into a reality, it means pursuing the common good while respecting high and noble principles, strongly opposing the interests of a few that do not produce wealth but only social inequalities.
​With the Recovery Fund our societies will be able to progress, grow and modernize and finally create new and better models of economic and social development.
With the Recovery Fund you will be able to do so much, so much and you can't fail!
​For these reasons, expectations are very high and therefore difficult to maintain, but usually the most demanding challenges are sometimes the ones that most distinguish the history of People and Companies.
​In this scenario that combines positive and joyful feelings with fears and fears, there is only one way forward, the one that requires the best use of European Funds for the benefit of a healthy and fair economic growth.
​To this end are called the Executive Classes of the Public Administration, which have been assigned a task of high responsibility in indicating and choosing the best strategies and solutions, operating with wisdom, competence and timeliness; it will not be easy but it must be done.
​The goal will be to think and make "good projects" pursuing as primary purpose the utility and social welfare, through the search for the concreteness of the needs on the one hand and the need to satisfy emotions, feelings and desires on the other; only in this way you can get the true social consensus that is the engine of the economy and economic recovery.
​However, all this will be possible only if one is able to eliminate the fragility that every Project brings with it, through the generation of the criticalities and risks deriving from the interdiscplinary nature of the project components.
​Therefore, the assessment and analysis of project criticalities and risks is a primary activity to enable the realization of good Projects and represents the guarantee for the Recovery Fund.
​The Project Rating is the tool used to identify, analyze and manage project criticalities and risks and is therefore a guarantee of safety for the Recovery Fund.
​Finally, I like to express a simile that is current in our day:
​Just as the vaccine is the antivirus with which you can fight the virus-covid, the Project Rating is the tool with which you can manage and eliminate the virus-criticality and risk of the Project.