1 IACS AND THE SINGLE PAYMENT SCHEME ROD PLINSTON RPA/Defra Policy Directorate 11 th February 2009

2 Direct Payments to farmers : general features  Single Payment Scheme triggered by holding entitlements and land  New IACS – Rural Land Register (LPIS), entitlements registers, single business identifier registers.  Inspection regime : land eligibility.  Cross Compliance – SPS and Rural Development Schemes.  Supplementary Aid schemes – decoupling  Energy Crops, Protein Crops, Nuts.  Financial Discipline mechanism.  National Envelope Schemes.  Mandatory Modulation – cross-funding of Rural Development schemes.  Member States choices – Entitlements model, when to implement, when to decouple existing schemes.

3 SPS : English Option  Implemented in 2005  Full Decoupling  All arable, beef and sheep  Dairy Premium  Seeds, Hops  No National Envelope  Compulsory Modulation / Voluntary Modulation  Progressive Flat Rate Option  English Regional Model  Severely Disadvantaged Area of the Less Favoured Area  Moorland within SDA  Other English Land

4 IACS : Key Controls  New IACS  Cross-checks with internal databases (Customer, Land, Entitlements, applications).  Cross-checks with external databases (Devolved Administrations, English Rural Development Programme).  Cross-checks with other schemes (Dried Fodder, Fibre Flax Processing etc).  On-the-spot controls for land eligibility including remote sensing and physical inspection.  Cross-compliance Adequacy of physical inspection process and application of sanctions – meet ‘SMR’ and ‘GAEC’ conditions.  Accuracy of entitlement calculation and distribution in entitlements registers (database in SPS).  Achievement of deadlines – claim submission, corrections submission, annual payments window.

5 IACS Challenges : LPIS  Mapping of rural land in high volume by a deadline – RPA working with industry. 120,000 applicants with 8.7 M hectares  Mapping requests following farmer claims, farmer mapping requests, other schemes.  Resolving mapping problems.  Maintenance of the LPIS against independent reference data over time.  Amending the LPIS with photographic data / remote sensing.

6 IACS challenges : entitlements  Controls on farmers’ access to the aid regime.  1 Entitlement = 1 Hectare to ‘establish’ in Year 1 and ‘activate’.  1 Entitlement valued per farmer on historic or other data.  Historic data – assembly of reliable payments data under past IACS schemes. Notified existing farmers.  Historic + Flat rate and National Reserve allocations.  Hardship cases.  Transfers of entitlements.  New Businesses / changing Businesses.  Future : end of set-aside, re-labelling of entitlements.  Future : decoupling of protein, nuts, dried fodder, fibre flax – complexities of transfer of funds to existing SPS entitlements, targeting farmers, or creating new entitlements (historic or flat rate).  Future : Review of Regional Model in England ?

7 IACS challenges : customer registration  Single Business Identifier (SBI) numbering, rationalisation of several earlier identifiers.  New farmer types registered _ e.g. horses, orchards – link to entitlements allocation.  New, continuing, or separate businesses.  Health Check : ‘genuine farmer’ test.

8 Further changes to IACS / SPS 2009 onward: Operational changes for RPA:  LPIS (RLR) Data Refresh  Electronic Channel for customer claims and LPIS.  Customer registers linked to land. Main policy changes:  Funding of National Envelope schemes from SPS (all ‘Pillar 1’ funding)?  Net budget ceiling monitoring for Pillar 1 schemes and scale-back.  Cross Compliance – environmental set-aside, water management.  ‘Non-agricultural land’ and ‘genuine farmer’ checks.

9 Entitlements : English ‘Regional Model’  English Ministers chose a “transitional Area based” model  All entitlements have a flat rate  Some have a top-up according to their reference amount  Over 8 years flat rate increases and historic decreases  England split into 3 regions  Aim was to stop funds going to lower producing, high land  Most funds to Non-Seriously Disadvantaged Area (‘n-SDA’)  Medium funds to ‘SDA’ area  Low funds to Moorland SDA area

10 Entitlements System :1 Base Data needed for Entitlements Calculation Ceilings Dairy Premium Increases Average Regional Entitlement Values Adjustment Facility Calculation Scale back Re-calculation Transition calcs Validations Cross-checks Allocations Hardship Claims Appeals Reversions Surrenders Transfers Mergers/Splits Inheritance Statements Reports Ceilings Dairy Premium Increases Average Regional Entitlement Values Adjustment Facility Calculation Scale back Re-calculation Transition calcs Validations Cross-checks Allocations Hardship Claims Appeals Reversions Surrenders Transfers Mergers/Splits Inheritance Statements Reports Interim Historic Receipts Data Extraction Reference Amounts (XANSA) Reference Amounts (XANSA) RITA Data Capture Verification Validation Cross-checks Inspections Payments Accounting Matrix etc RITA Data Capture Verification Validation Cross-checks Inspections Payments Accounting Matrix etc SPS Applications SPS Applications Arable Livestock Associated Schemes Associated Schemes Normal and Set-Aside Entitlements Calculator Re-calculator Normal and Set-Aside Entitlements Calculator Re-calculator Entitlements Register Entitlements Register National Reserve National Reserve Dairy Ref Amount Dairy Ref Amount Milk Quota System 31/03/05 Ref Data Milk Quota System 31/03/05 Ref Data New Claimant 2005 Data Known Claimant 2005 Data Average Set-Aside Rate (% Arable Land) Average Set-Aside Rate (% Arable Land) Annual Transition Rate Calculator Annual Transition Rate Calculator Controls 2005 Severely Disadvantaged Parcels and Non SDA Land Parcels 2005 Severely Disadvantaged Parcels and Non SDA Land Parcels 2005 Hectares (inc Set-Aside, Arable, NFSA and Organic Land, Fruit and Veg Land) 2005 Hectare Data

11 Entitlements System 2 : English Regions example: SDA land SDA land is in pink Non-SDA land covers the remainder plus DA land DA land is in blue

12 Entitlements System 3 : Transition to Flat Rate with SDA and non-SDA land Non-SDA SDA

13 Entitlements System 4 : Entitlements register entries for ‘F. Giles’