Commissioner Hogan proposes a fairer and more transparent penalty system for direct payments

The latest tranche of simplification measures unveiled by EU Commissioner for Agriculture and Rural Development Phil Hogan will include a raft of measures designed to end the “climate of fear” for farmers when applying for aid under the Common Agricultural Policy.

In line with the ongoing efforts to simplify the implementation of the Common Agricultural Policy (CAP), Commissioner Phil Hogan presented on 18 January pdf – 236 KB [236 KB] his latest proposals to the members of the Agriculture and Rural Development committee of the European Parliament, in Strasbourg.

The focus of the newly announced simplification package is on the penalty system for most direct payment schemes, to take into account reasonable concerns by farmers in case of unintentional mistakes while also reducing the frequency of errors and therefore protecting public funds.

The simplification package unveiled yesterday by Commissioner Hogan consists of three complementary elements. First of all, preliminary checks of aid applications would allow farmers to make corrections to their aid applications during a period of up to 35 days after the final date of submission without any penalties.

Second, the system of administrative penalties for direct payments would be simplified. Whereas the current system for the calculation of penalties is based on different categories that can result in penalties of sometime more than double than what is over-declared, the different categories will be replaced by a simple penalty, which is 1.5 times the area over-declared. This reduced level of penalties, when approved, would apply for 2016. Small over-declarations that are up to 3 per cent of the area declared or 2 hectares would continue to not be penalised.

Third, a ‘yellow card’ system for first offenders would be introduced. Where the over-declaration is minor (below 10% of the area determined), the administrative penalty would be cut in half.

Farmers having received a yellow card will be registered and will be subject to an on-the-spot control the following year.

Commenting on the proposed changes, Commissioner Hogan said: “These simplification measures should have a direct effect on farmers, sending a clear message that our interest is not to catch farmers out as it were, but ensure that public money is well spent. Farmers, I know, fully support that goal.

I believe that the preventive preliminary checks, the yellow card and the simplified penalty system should make the lives of farmers easier, and even more importantly, they should reduce significantly the number of error and consequently of cases where administrative penalties would need to be applied.”

“These proposed changes should end the climate of fear for farmers, and are a fair and proportionate response to the concerns of smaller farmers in particular”, he concluded.

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