Progress on the Common Agricultural Policy Delivery Programme

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This an update on earlier reports by the NAO and Committee of Public Accounts on the progress of the Common Agricultural Policy Delivery Programme. It focuses primarily on the 2015 Basic Payment Scheme payments to English farmers and landowners and improvements to the process for the 2016 and future years.


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The National Audit Office (NAO) has today published an update on the reports by the NAO and Committee of Public Accounts on the early progress of the Common Agricultural Policy Delivery Programme.

It focuses primarily on Basic Payment Scheme payments to English farmers and landowners. These make up around 80% of the total payments made under CAP and it was the Rural Payment Authority’s priority to develop the functionality to make these payments.

The Committee of Public Accounts is scheduled to take evidence on this report.

October 2016

 

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Progress on the Common Agricultural Policy Delivery Programme 10/2/17

Summary
The extent of the Rural Payments Agency’s (the RPA’s) failure to pay farmers in England on time and in full is now clear. The RPA paid only 38% of farmers under the Basic Payment Scheme on 1 December 2015 (the first day of the payment window) compared to over 90% in previous years. By the end of January this had risen to 76%, but at the end of March 2016 there were still 14,300 farmers (16%) who had not received any payment. Over 10,000 farmers who had received a payment had not been paid in full. Two thirds of the additional payments made to these farmers were in excess of €1,000 and were first paid in September 2016, over nine months after the first payment could have been received. The Department for Environment, Food and Rural Affairs (the Department) has responsibility for rural affairs in England, but it has not assessed the impact of these failures on farmers and the rural community nor done enough to mitigate the impact on farmers’ livelihoods of late and partial payments. The Department has been very slow to properly address the risk of financial penalties, known as disallowance, imposed by the European Commission for not complying with the scheme’s rules which remain far too high and it has failed to learn lessons from other countries that have been more successful in avoiding these penalties. The Department’s record of failure when developing systems to support subsidy payments to farmers does not inspire confidence in its ability to cope with the challenges associated with Brexit that lie ahead.

Full report here

Recommendations:

1.The Rural Payments Agency (RPA) was unable to pay farmers the full amount due on time.

Recommendation: The Department needs to ensure accurate, full payments are made in a timely manner in the payment window starting in December 2016 and that it returns to previous payment performance levels for 2017–18. The Department needs to ensure that the departure of Mr Grimshaw does not unduly impact on the delivery of improved performance.


2.The RPA needs better data to make full payments promptly and accurately.

Recommendation: As part of its commitment to providing farmers with timely payments, the RPA must ensure that its land register is accurate. It should in the response to this report, set out when it expects to have digital maps with data that is no older than three years and also when it will reduce this to one year.

3.The Department has not assessed the impact on farmers and the rural community of failing to make full payments on time.

Recommendation: The Department must learn lessons from the floods to ensure payments to farmers in times of crisis are not delayed. It should also look at how it identifies affected farms to ensure those in need receive support. The Department more generally must improve its understanding of the impact delayed payments have on farmers and the wider rural community.


4.The availability of hardship payments and bridging payments was not enough to mitigate the impact on farmers’ livelihoods of late and partial payments.

Recommendation: Whilst we welcome the Department’s decision to rename hardship payments in response to concerns raised by the Committee, it should seek to remove any potential stigma attached to applying for BPS Financial Support Payments, and provide greater certainty to farmers about when they will receive their payments.


5.Disallowance penalties remain far too high, and an effective strategy to address this has taken too long to develop

Recommendation: Leaving the EU does not absolve the Department from ensuring that the current high level of disallowance penalties does not continue. The Department must now focus on delivering its delayed strategy to address this waste of taxpayers’ money.


6.The Department and the RPA have been remiss in not identifying and adopting best practice from other countries to develop a system that works properly and minimises the rates of disallowance

Recommendation: The RPA should do more to compare with and learn from other paying agencies, in the UK and Europe, and implement best practice more rapidly.


7.Any new programme of payments to farmers following Brexit must avoid the pitfalls of the past to ensure farmers are paid promptly and in full.

Recommendation: As the body with the necessary understanding and expertise on what works, and what does not work, the RPA must be at the table to support discussions of any future subsidy payment scheme to farmers following Brexit.