Lower SPS DEductions but Payments Delayed?

Financial Discipline may be revised downwards even further, but farmers could face delays in receiving their 2013 payments.  An amending letter to the EU Draft Budget reveals it will only be necessary to save €902.9 million compared to the €1.47 billion in the original Budget figures.  This new lower figure means the Commission are now proposing a 2.45% cut (Financial Discipline) to 2013 direct payments.

The original Financial Discipline rate had been proposed at 4.98% with the first €5,000 of a claimant’s payment being exempt.  This was then reduced to 4% as it was proposed to use the CAP reform rules to lower the exempion rate to the first €2,000.  The revised rate of 2.45% is also subject to agreement on the lower exemption rate being adopted, which is not yet a done deal.  The European Parliament want the exemption to remain at €5,000 whereas Council are pushing for the new lower threshold.

The proposals have until 1^st December to be agreed.  It is expected that they will be discussed at the Agriculture Council meeting on 18^th November.  Although this new rate is good news for farmers’ payments, agreement at the November Farm Council is crucial if payments are to commence on 2^nd December (1^st is a Sunday).  The various UK paying agencies cannot start paying out the 2013 SPS until the Financial Discipline rate is set.  In England, the RPA cannot even cannot carry out its annual revaluation of entitlement values which needs to be done before payments are issued..