Basic Payment Scheme

Chris Davies Excerpts

Thursday 28th January 2016 Westminster Hall

[Chris Davies (Brecon and Radnorshire) (Con)]

It is a pleasure to serve under your chairmanship, Mr Betts. I congratulate my hon. Friend the Member for Wells (James Heappey) on securing the debate and on the valid points he made. I am sure that his constituents will feel their views were expertly represented, and I will do my best to put my points as eloquently as he put his.

This issue directly affects a large number of my constituents, as Brecon and Radnorshire is one of the most rural, and most farmed, areas in the UK, with many farmers who claim the basic payment. I accept that the payment process is devolved in Wales, but my constituents and I have many of the same concerns about the payments system that people in England have. I am sure the hon. Member for Blaenau Gwent (Nick Smith), my neighbour in Wales and the shadow Minister, will agree with many of my concerns.

I am a member of the Environment, Food and Rural Affairs Committee, and we have on several occasions quizzed the Minister—and, indeed, on Tuesday, the Secretary of State—on our concerns about the RPA. The chief executive of the RPA has also given evidence. I am delighted that they will all be coming before us again; we look forward to looking further into the mistakes and getting the exact reasons for them out of the chief executive.

[Simon Hoare]

My hon. Friend has had a joyous luxury that I have not partaken of—meeting the new people who are running the agency. Do we know what percentage of agency staff have ever farmed or been involved in farming?

[Chris Davies]

I thank my hon. Friend for that great intervention. We can only guess—and our guess might be that it is probably not a lot; but that is purely an assumption, and I cannot provide the facts. The Minister may be able to enlighten us further.

We must do everything we can to get the payments out to farmers as effectively and efficiently as possible, to resolve the current issue of delays to payments. I know of many local farmers in Wales who have received part-payments. Of course England has a completely different system. It does not have a part-payment system; it is paying fewer farmers, but in full. We need to get all the money out because in addition to the effect of payment delays on farmers’ cash flow, falling market prices of produce hamper the growth of the farming industry around the UK. With incomes low, many farmers tell me they are unable to pay suppliers until the payments come through. That has a direct impact on the ability to run local businesses and affects the whole rural economy. That is why we must do all we can to get payments out as quickly as possible.

[Michael Tomlinson]

Perhaps my hon. Friend will elaborate a little more on the part-payments that have been made and how well they have worked in his experience. Farmers whom I have met have said, “At least give us something now to help tide us over before we get the certainty of the full payment.” Perhaps he will elaborate on that a little more.

[Chris Davies]

I thank my hon. Friend for raising a very good question. In Wales, certain payments have been released—30%, 50%, 70%—but, as the permanent secretary told the Select Committee on Tuesday, the Department decided not to do that because that would mean a system of reprocessing claims, taking even longer to get the full payments out, so it was decided not to go down that route. I am sure the Minister will elaborate on exactly why, but that is what the Select Committee was told.

In Wales, the Welsh Government have in part put the delays down to a legal challenge to the new system that they intended to implement back in 2015, but I cannot help but wonder why there was not a back-up system in place as soon as the legal challenge was launched. That would have ensured that farmers would not face the sort of delays they currently face today. Although I appreciate that that was not under the control of the Minister here today, I wonder whether he will join me in recommending that, should such a challenge be put in place on any side of any border in the future, reasonable back-up systems should be in place so that farmers are not adversely affected.

That brings me loosely on to my second point. Farmers do not seem to have been informed of what is happening with their claims. The uncertainty this creates should not continue, and I am glad to hear that both the RPA and the Welsh Assembly will now write to farmers to inform them of why their claims have been delayed. That said, can I urge the Minister to ensure that, included in the letter, will be a statement of when each farmer can expect to receive their payment, as this will enable farmers to plan their cash flows better and assure their suppliers of when they can expect to be paid. The Secretary of State and the permanent secretary told us on Tuesday that they expect payments to go out somewhere between February and June, but we know that the window closes in June and we could not get a more specific time. Perhaps the Minister will know a little more about that.

We should keep our farmers up to date because they need to plan for the future. Each farmer is a small business; some are very large businesses in our rural economy. Without being able to get their payments, they will not have a business plan, and that has an impact. We should resolve the issues that we currently face as quickly as possible. I also think it is vital that we learn the lessons from this year’s application process, as my hon. Friend the Member for Wells has emphasised strongly. While the crisis is still going on, it is difficult to analyse exactly what has gone wrong. The applications will begin again in May this year. Can the Minister outline the lessons that he believes the RPA and all administrative bodies can learn to ensure that we do not face the same issues again in the 2016 application period?

On the basic payment system more widely, what is the Minister’s view on the stringent nature of the Assembly’s application of the BPS rules? I have several constituents who are concerned that they are not receiving their full allocation owing to the nature of the satellite imagery used to assess their farm sizes. Simple issues such as the shadows of trees mean that farm sizes are being shrunk, as the shadows caused by the trees make wooded areas look larger on satellite images. This then shrinks the size of farms, often by considerable distances, and diminishes the payments that farmers receive. This causes delays to some farmers’ payments, so will the Minister press the Assembly to look at new, more efficient ways to process basic payment schemes? For too long the system has been too complicated, and it is about time we simplified it best to assist our farmers.

In conclusion, I believe we face significant issues with this year’s applications that should be resolved as swiftly as possible, and I look forward to the Minister’s response on the issues that hon. Members raise today. The most important consideration we must take from the payment delays this time around is to ensure that not only are lessons learned, but also that resolutions are implemented in time for next year’s applications. Farmers should be able to focus their efforts on farming their land and not on form filling and concerning themselves with whether or when they will be paid. With all the current and predicted hardships that our farmers face, I implore the Minister to ensure that farmers’ basic payment scheme applications will not be a further hardship next year as well.