Horizon Europe uses lump sum funding to reduce administration and financial errors. Lump sums make the programme simpler by removing the need to report actual costs. This means easier access to the programme, especially for small organisations and newcomers, who often lack the experience and capacity to cope with the complex rules for actual costs.
Lump sums are defined up-front and fixed in the grant agreement. They are paid upon completion of the activities in work packages.
Beyond that, the planning, evaluation, and execution of projects does not change much. In particular, the payment of lump sums is not dependent on successful outcomes (which are never certain in research) and follows the standard payment schedule. Lump sum projects enjoy the same degree of flexibility, and their performance is judged by the same standards.