Parliament 14th August 2015

DEFRA fines threat brings nasty sting in the tail to closing Parliamentary session, Catherine Paice reports

The department’s been spending a lot of time and resources trying to avoid more fines, which could in themselves require investment of £25-£45m, reveals a report by the National Audit Office (NAO). It notes that progress has been made over the past year in DEFRA’s approach to managing the financial penalties imposed by the European Commission, but problems giving rise to financial penalties are persisting, and there are additional risks arising from the more complex CAP 2015-20 scheme.

The report had a stab at reflecting DEFRA optimism: “If it can successfully tackle all sources of mapping-related disallowance, DEFRA believes it could avoid future penalties in England of between £215m and £370m by 2021.”

But its already been fined £642m in the past 10 years as a result of not properly controlling and administering rural payments to farmers in England. These “disallowance penalties” were mainly been issued between 2005 and 2014 under the previous CAP scheme – the use of data mapping for verifying applicants and cross-compliance controls was somewhat lacking during this time, but the NAO claims the immediate breakdown in DEFRA’s handling of the new CAP system flags up huge possibilities for error and, therefore, more fines, especially in the next few years.

So far the new system for CAP payments, which was meant to be simple, has been more complicated and 15% more expensive to deliver than the previous scheme. “Future levels of disallowance are highly dependent on the final design of the system and the extent of delays in implementation,” the report said.

Meanwhile, a written question from the House of Lords, from Baroness Byford (Con), drew attention to a Court of Appeal judgement in July, R (on the application of Andrews) v Secretary of State for Environment, Food and Rural Affairs, which has alarmed landowners, as a result of which up to 1,000 lost paths and bridleways could be reinstated, based on a law passed more than 200 years ago. Lord Gardiner of Kimble (Con) replied, saying local highway authorities were responsible for protecting the rights of the public to use footpaths and other rights of way, and for holding relevant records, so DEFRA did not have the information required to make an assessment of the number of landowners who may be affected by the judgment. “However, we recognise that there may be a significant number of claims,” he said. The Ramblers Association estimated 500-1,000 in court. “This would have an impact both on landowners, in defending any claims, and on local authorities, in dealing with such claims.”

One to watch.

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