Commission announces relaxation of cross compliance system

The Agriculture Commission has today announced a series of changes to the cross compliance system under which European farm subsidy payments are made conditional on farmers meeting basic rules relating to farm management and environmental conservation. The thrust of the changes is to streamline the system, make it less onerous for farmers and for the government authorities charged with inspecting farms and enforcing penalties where rules have been broken.

Even though farmers are, on average, likely to be face an on-the-spot check just once every 20 years, many farm unions have complained to the Commission about the extra burdens associated with cross compliance. This simplification is seen as a response to these representations and includes a provision that unless otherwise specified, the inspection rate of 1 per cent of farms should be applied. This means that a farm will receive, on average, one inspection every century.

The Commission announced that in 2005, 240 898 on-the-spot checks were carried out (an inspection rate of 4.92 percent). Reductions in subsidy payments were applied in approximately 28 600 farms (0.59 percent of all farms). Most breaches related to the identification and registration of cattle, with the remaining cases mostly concerning the rules on general environmental management and the Nitrates Directive. A total of €9.84 million was deducted from the subsidy payments of farmers who breached cross compliance laws. This works out at an average payment reduction of €344 per per farm found to have been in breach. Most payment reductions (68 percent overall, up to 98 percent in some Member States) were applied at the minimum level of 1 percent of subsidy payments. Some 14 per cent were applied at a 3 per cent level and 12 per cent at a 5 per cent level.

Among the changes announced today to streamline the system are:

- a de minimis rule to exempt from reductions any penalty falling below €50. A warning letter would be sent and follow-up ensured also in this case.

- a single control rate, of 1 percent minimum, for on-the-spot checks. In cases where checks have revealed a significant degree of non-compliance, checks will be increased, but this increase should focus only on the areas of risk and not on all standards, as is currently the case.

- The Commission will create the possibility to give notice of checks up to 14 days in advance as long as the purpose of the controls is not jeopardised. Controls on feed and food law, animal health and animal welfare and identification and registration of animals will remain unannounced.

- Checks need only be made on half of the land parcels, rather than the whole farm.

- New Member States which apply the SAPS scheme of direct aid will have to implement farm management rules from 2009. It is proposed to allow a three-year phasing-in period for this. For Bulgaria and Romania, this phase-in period will begin in 2012.

Cross compliance was introduced in order to demonstrate to Europeans who pay for farm subsidies that they are getting something in return for their money. As Mariann Fischer Boel said today, “Direct payments will only be acceptable to the public if people can see that our farmers are being rewarded for carrying out vital tasks in the countryside.”

It has already been reported on this blog that cross compliance has introduced very few new obligations for farmers, rather cross compliance means that farmers are being paid to observe pre-existing laws on animal welfare and environmental protection. Whatever the complaints may be about this, and about the surprisingly high rate of compliance, the real weakness of the cross compliance system is that the amount of subsidy a farmer receives is only very remotely linked to the amount of conservation work he or she is carrying out. The amount of farm subsidy is related either to the area of land farmed or to historic payments. It is not in anyway linked to the ‘added value’ that the farmer brings to the environment and the wider landscape. Most payments are concentrated in areas of highly intensive production because these were the areas that attracted the highest rates of production-based subsidy prior to decoupling.

As an environmental enhancement programme, cross compliance is very poorly targeted and therefore yields much less value for money than the more targeted environmental stewardship payments that feature in the second pillar of the CAP, the Rural Development Regulation.

Read more on the Commission’s website.

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