Defra is making changes to the way farmers are paid for protecting the environment, after an EU audit of England's agri-environment schemes.
The schemes fund green farming methods such as creating wildlife habitats and protecting the English landscape.
Although Defra’s schemes are effective and have been designed to make them attractive to farmers, the European Commission concluded that payments should only be made at certain points during the year instead of on a rolling basis throughout the year, to comply with EU law.
The Commission has asked Defra to establish an annual deadline for applications of 15 May. This may have an impact on when applications for new or renewed Stewardship agreements can be accepted, and on the start dates Defra is able to offer for these agreements.
The Commission has also asked for an annual cycle for payments, so that payments can only be made at particular times of the year. This would not apply to payments for capital works, which can continue to be made as at present. Agreements starting before 1 January 2007 may also be unaffected, but the Commission has yet to confirm this.
Talks between Defra and the European Commission are not yet complete and specific details of the changes are yet to be decided. Farmers are being notified now so that they are aware of this situation, and have the opportunity to contribute their views.
Defra is making every effort to minimise the potential impacts on agreement holders and to persuade the Commission to adopt a flexible approach, but it is likely that there will be some delays to at least some payments. We recognise the uncertainty that this issue will cause, and are working to resolve the situation as quickly as possible.
Defra does not expect to make any changes before 2011 at the earliest. In the meantime, farmers are encouraged to continue to apply for new or renewed Environmental Stewardship agreements as before.
Any changes to the schemes will not affect the amount of the payments or the total funding which farmers receive under their agreements.
Natural England will be writing to all farmers taking part in agri-environment schemes to inform them in more detail of the situation. Defra and Natural England will also be meeting all farming and other groups with an interest, to discuss the implications of these changes.
- Why do we need to make changes?
The Commission have told us that they do not believe that we are currently delivering agri-environment schemes in line with their interpretation of EU law, particularly in relation to
- the requirement for a 15 May claim date and
- the timing of when payments are made to farmers.
We have a responsibility to ensure that our schemes are delivered in accordance with EU law. The Commission has the power to levy disallowance corrections on Member States, and we therefore need to take action to address this disallowance risk.
We believe that our systems are basically robust, and provide a good level of financial control. However, we will now have to make changes to our schemes to comply with the Commission’s interpretation of the legal requirements. We believe that these changes will only relate to agreements starting from 2007 onwards, although the Commission have yet to confirm this. Payments for capital works within agri-environment schemes are unaffected.
- What changes will you be making? Why are you telling people now when it isn’t clear exactly how they might be affected?
Our discussions with the Commission have not yet been concluded. However, we are keen to involve stakeholders now, and to seek their views on how we can best mitigate the impacts of the changes we will have to make. Ministers have not yet taken decisions on the exact shape of the changes we need to make. And all changes and their timing will ultimately be subject to the Commission’s approval.
It has only recently become clear that we will need to make changes to our systems to respond to the Commission’s concerns. We thought it right to tell people now so that they have all the available facts. Natural England will be writing to all current agreement-holders to inform them directly, and we will also be discussing with stakeholders and seeking their views on how best to minimise the impacts of the changes we will have to make.
- What is the timescale for changes?
All changes and their timing will ultimately be subject to the Commission’s approval. But we do not expect to make any changes before 2011 at the earliest.
- Will ES payment rates change?
The discussions with the Commission have focussed on how we make our payments, not on the level of these payments. In other words, payment dates might change for some farmers but the amount of money paid to you over the lifetime of your agreement will remain the same.
- Will this change what I have to do under my agreement?
This does not involve the management we pay you for or the scheme options available.
For further information please refer to the Natural England website.