Basic Payment Scheme

Michael Tomlinson Excerpts

Thursday 28th January 2016 Westminster Hall

[James Heappey]

I very much agree with my hon. Friend. I will shortly come on to some of the impacts of late payments that I have seen, but he makes a good point, which I hope the Minister will take away. Perhaps those of us here today might seek to lobby the Treasury on exactly that issue, because farmers have a great number of bills on their desks awaiting payment once the basic payment comes. We can perhaps ease the pressure by making their tax bill less urgent.

[Michael Tomlinson (Mid Dorset and North Poole) (Con)]

I am grateful to my hon. Friend for securing this important debate. May I pick up on two things he has mentioned? First, I have had a number of meetings with farmers in Dorset who are concerned about the issue. Secondly, uncertainty is perhaps the key here. Farmers are asking for good communication and certainty. Perhaps my hon. Friend will comment on that. Part payment could be a solution and a way forward.

[James Heappey]

My hon. Friend does the farmers of Dorset a great service in raising those issues, which I intend to speak on at some length because they are hugely important.

I have the great honour of serving on the Select Committee on Energy and Climate Change, and one thing that I have observed is that we talk about energy security with great urgency—we are willing to bend our backs in government and in this place to ensure that we achieve energy security—yet we seem to be slightly less concerned about food security. I put it to the House that in many ways our food security is as important as our energy security and any other type of security, in that while the going is good we can rely on international markets, but when the going is bad, it is absolutely essential that we can feed ourselves. We must therefore be sensible and urgent in how we support farming to ensure that we maintain the sector.

--- Later in debate ---

[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.