UK government fined £75m for late farm payments

The British government is being fined a total of £75m for failing to get farmers’ single farm payments out on time.

The figure is contained in the EU’s latest clearance of accounts report, which also signals another £24m fine for UK failings in the fruit and vegetable sector.

Industry experts say the fine is extremely disappointing, but not a complete surprise.

Failures by the Rural Payments Agency in particular to get all SFPs out to English farmers by the 30 June deadline each year have been well publicised.

Initially this was down to the highly complex “dynamic hybrid” system that DEFRA chose for allocating SFPs in England, comprising both historic and flat rate elements.

Instalment of new computer software at the start of the new payment system added to the RPA’s woes.

NFU chief legal adviser Julie Robinson described the fine as “a double whammy”, since farmers had suffered once, through not getting their money on time, and would suffer again as money had to be recouped from somewhere.

To some extent this has already happened, as DEFRA made a £131m provision in its accounts in 2006 as a contingency.

But Ms Robinson said that the late payment element of the fine was only part of the story. There would also be another fine to come for incorrect payments that the RPA had made in the past. “I fear this may be even bigger,” she said.

Normally the UK has a good track record when it comes to fines from Brussels. But the £75m charge just announced is the second largest in this latest round of payment corrections.

Only Italy has been fined more – about £92m for failure to control olive oil subsidies. Italy is also being fined another £50m for failure to meet payment deadlines.

“We are working extremely hard to maintain the best possible control over farm spending,” said EU agriculture commissioner Mariann Fischer Boel.

A DEFRA spokesman insisted that the £75m was not a new fine. “This decision relates overwhelmingly to the 2005 SPS payments that were made in the 2007 EU financial year (16 October 2006 to 15 October 2007.)  There is no financial impact on the UK as the deductions were actually made some time ago.”

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