BPS claimants who want to transfer entitlements need to get these lined up as soon as possible, as there may be hitches, agents have warned.
Entitlement transfers in England must be completed by the 16 May BPS claim deadline, but the advice is not to leave it close to this deadline as the new transfer system is untested and paperwork and funds will need to be processed, too.
Transfers are being hampered by lack of accurate information from the Rural Payments Agency (RPA), including late claims statements, incorrect claims statements, incorrect “use-by” dates showing online and delays in processing field changes that have been notified on RLE1 forms, say agents.
Sellers should check their claim statement and query with the RPA if any problems are seen, said George Paton of Webb Paton.
“Also begin enquiries about marketing surplus entitlements early. Buyers should aim to source their requirements from reputable agents who have checked the reliability of the data about the entitlements thoroughly. Buyers might also learn from experience in last year’s trade not to wait until the last minute to buy.”
Trade in BPS entitlements has picked up in the past few weeks, with prices settling at £190-£200 plus VAT for most English non-SDA entitlements.
Some agents have evenly matched buying and selling interest, while others report more buying enquiries than sellers, after prices fell through March from well above the £200 mark.
“Looking at our register to date, the balance of available entitlements to those wanting to buy them is clearly weighted in favour of those wanting to buy but who have not yet taken the plunge, no doubt hesitant about managing farm costs and also hoping that prices could fall further,” said Hugh Townsend of Townsend Chartered Surveyors.
More non-VAT-registered vendors were needed, especially for the smaller-volume market in non-SDA entitlements, he said. “There have been plenty of non-VAT buyers, effectively splitting the saved VAT with the non-VAT-registered purchaser.”
While there had been interest in leasing out entitlements, there was currently little or no interest in leasing them in, he said. The SDA market is quiet, with values indicated at £220-£230/ha.
The Welsh, Scottish and Northern Irish markets were reported quiet because of delays in receiving 2015 CAP payments, or only receiving part payments, so they could not identify accurately the entitlements allocated in 2015.
Illustrative values only in Scotland showed a multiplier of between 1.2 and 2.9, but a trading deadline of 2 April meant that unless an extension was made, buyers and sellers north of the border would have to wait until next year to sort out their entitlements, said Mr Townsend.
He also warned that while it was the RPA’s intention to have an automated letter (not email) sent out confirming each transfer, at the moment the system was not fully tested and manual checks were still taking place after the computer showed the entitlements had been transferred before a manually produced letter is sent out.
“Therefore, great care needs to be taken and one can see a number of complications could be produced if people unwittingly rely on the onscreen information without first receiving written confirmation,” he said.