Page last updated at 23:46 GMT, Monday, 14 July 2008 00:46 UK

EU farm subsidy 'errors persist'

Farmer with flock of sheep in Cumbria
Farmers need to be told when they will be paid, the report said

There are still problems with the distribution of EU farming subsidies to English farmers, three years after mass delays in payouts, MPs have said.

An internal review found more than 10,000 farmers were overpaid in 2005, and 7,000 in 2006 but "little action" had been taken to recover the money.

Delays meant "uncertainty" for farmers and some money may have been spent, said the public accounts committee.

The government said the payments scheme had improved in 2007.

The Rural Payments Agency had been charged with allocating about 1.5bn a year under the EU's single farm payment scheme (SPS) - but there were long delays in payouts.

'Turned around'

The scheme, a major change to the way farmers received EU payments, was introduced at the same time as a new centralised computer system to process applications - and as staff numbers were being reduced.

Those factors were blamed for problems with the 2005 payments, which should have been paid to 96% of farmers in England by March 2006, but only 15% got them on time.

Where overpayments have been identified, the agency has taken little action to recover the sums, with the risk that farmers may have unknowingly spent the money in the interim
Public Accounts Committee report

The Department for Environment, Food and Rural Affairs (Defra) says performance of the single payments scheme has since been "turned around" and the Rural Payments Agency has met all of its 2007 payments ahead of schedule.

But in its report the committee said nearly 20,000 farmers' entitlements under the 2005 and 2006 schemes had been calculated wrongly - and overpayments totalled more than 37m.

Some farmers were overpaid by more than 50,000 each, it says.

"Where overpayments have been identified, the agency has taken little action to recover the sums, with the risk that farmers may have unknowingly spent the money in the interim," it said.

'Errors persist'

The report also says while IT changes mean most farmers received their 2006 payments earlier than in 2005 - the agency was still not able to give "adequate advice" to farmers on the progress of their claim.

Committee chairman Edward Leigh said the agency's "poor implementation" of the single payment scheme, "continues to cause problems for farmers".

While it is well documented that there were problems with payments during the first year of the scheme's operation, the performance of the scheme has been turned around
Defra spokesman

He added: "Most are being paid earlier than they were in 2005 but errors persist."

The problems may yet lead to the government being fined hundreds of millions of pounds and had added 50m to the project's costs, he said.

"Restoring farmers' confidence will depend on the agency's improving its business processes and IT systems to the point where it can process claims efficiently and promptly and tell farmers when they are likely to be paid," he said.

A spokesman for Defra spokesman said the department would consider the report "in full" before responding.

But he added: "While it is well documented that there were problems with payments during the first year of the scheme's operation, the performance of the scheme has been turned around and the Rural Payments Agency met all of its 2007 payment targets ahead of schedule."

But he said both the department, and the Rural Payments Agency, recognised "further steps need to be taken" to ensure an acceptable level of service.

The UK has set aside 436m in anticipation of possible fines from the European Commission over the administration of the 2005 scheme.




SEE ALSO
Farm subsidy failures condemned
05 Sep 07 |  UK Politics
Ex-farm subsidy boss 'cost 250k'
09 Jul 07 |  UK Politics
UK fined 36m over farm payments
19 Apr 07 |  UK Politics
Beckett attacked on farm payments
29 Mar 07 |  UK Politics
Ex-farm payments boss apologises
17 Jan 07 |  UK Politics
Ex-RPA chief 'still being paid'
27 Nov 06 |  UK Politics

RELATED INTERNET LINKS
The BBC is not responsible for the content of external internet sites


FEATURES, VIEWS, ANALYSIS
Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit

BBC navigation

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.

Americas Africa Europe Middle East South Asia Asia Pacific