When the European Commission imposed disallowances on the UK for mapping errors, which it describes as “land parcel identification system”, it seemed unfair. But it is now clear that the UK was just high up on a long list. That has now reached France, and as the biggest beneficiary of CAP payments, it is also facing potentially the biggest ever clawback, or disallowance. This topped 1 billion, which could rise as the Commission works through successive years.
At one level this is positive. It is a sign that the Commission is more even handed than people believed when we were in the firing line.
The availability of these funds from France and others should eliminate the need for financial discipline cuts to direct payments to help fund the crisis reserve being used to head off the impact of the Russian import ban. However, the existence of the fines raises fundamental problems about the rules governing the CAP. In the vast majority of these cases there was never any intent, at individual farmer or Member State level, to defraud the system. The punishment is for errors and the fact that they occurred is down to over complex rules.
What makes matters worse is that lessons were not taken on board. For the new CAP now being implemented we have even more complex rules. It is almost certain that greening will lead to disallowances in a few years’ time, although hopefully not on the scale of past mapping problems. Complex rules also mean potential problems over active farmers, and who is and is not active, and the award of top-up payments to young farmers.
While rules for 28 Member States and the spending of £30bn a year are inevitably complex, there’s no question that greening is the ultimate example of a regulation that is pointlessly complicated. Greening was little more than a vanity project for the former farm commissioner, Dacian Ciolos, and that will be proved when it delivers little in return for the bureaucratic nightmare it has created for arable farmers.
In March, farm minsters are due to present the Commission with their thinking on how to simplify the CAP rules. It is a safe bet that thinking will be about having a more sensible, risk-based inspection regime, with more decision making in Member States and a less draconian approach to inspections by Commission officials. However, the real sign of whether there will be any change will come in the report due in the autumn on CAP simplification from the farm commissioner, Phil Hogan.
The acid test of what he delivers will be whether he is prepared to distance himself from some of the Ciolos thinking, and pave the way for a sensible review of the current CAP in 2017. For that to happen farm ministers need to to make it clear with their plans that they do not want them put on a shelf to gather dust, but to be central to Mr Hogan’s thinking later in the year.
The last EU farm council brought a repeat of Mr Hogan’s, ‘crisis, what crisis’ approach to the dairy sector. He again rejected calls for a review of the intervention price set back in 2003. This is disappointing, but not surprising – given that his focus is on getting over the line in April to the end of milk quotas without concessions on intervention, supply management controls or superlevy.
He also rejected calls for aid for the pig sector, despite the impact the Russian food import ban is having on prices. This again was disappointing, but the issues raised by some Member States about prices are not going to disappear. Mr Hogan’s stance confirmed, however, that he is a tough nut to crack once he has made up his mind.