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Top tips to help farmers avoid penalties

Business News from the Fenland Citizen, fenlandcitizen.co.uk, @FenlandCit on Twitter

Business News from the Fenland Citizen, fenlandcitizen.co.uk, @FenlandCit on Twitter

Cross compliance failures cost farmers £1.4m in single payment penalties in 2012, and slight changes in legislation mean producers must remain vigilant this year.

Although lower than the £2.6m figure recorded in 2011, RPA inspections appear to be getting stricter, says James Brown, Agricultural Business Consultant at Brown & Co.

“The 2012 figures show that 35% of failures had penalty reductions applied of 5% or more of the business’s single farm payment. That compares with 27% of failures in 2011.”

The most common reason for deductions is failure to comply with livestock identification and registration rules – but that doesn’t mean arable producers can rest on their laurels, said Mr Brown.

“Livestock failures made up more than 50% of total cross-compliance breaches in 2012 – and I would suggest that a number of those were arable producers who also keep sheep and cattle.”

Often, when livestock make up a smaller part of the overall business, it is easy to lose focus and fall foul of the legislation, he says.

“Producers should always replace lost ear tags as soon as possible, keep good veterinary records, and submit movement information and passports within the required timescale.”

While the proportion of livestock failures is down on the year (from 70% in 2011) there was little improvement in arable compliance, which now accounts for a proportionally larger share of failures.

Of these, one of the most common is not filling in the soil protection review (SPR).

“That accounted for 8.7% of all failures, double 2011 levels, and 80% of those farmers lost 5% or more of their single payment as a result.”

To complete the SPR, farmers simply need to record their soil type and field risk, enter any problems encountered during the year, and identify necessary remedial action.

“Last year, many farmers may have driven on waterlogged land, causing soil damage,” said Mr Brown. “They would need to record that and explain how they plan to alleviate the damage – failure to do so could be seen as a breach.”

They should also take account of changes in farmed area, cropping or cultivation methods.

On average, a 100ha farm received just over £21,000 in single payments last year – so a 5% cut would equate to more than £1050. “Penalties do accumulate, so if there are other failures then the cuts could be more severe,” saod Mr Brown. “And recurrent breaches mean the penalty is tripled the following year, so you could very soon lose a lot of money.”

Penalties depend on the seriousness of the breach; whether it is deliberate; the permanence of the action; and whether the impact is limited to the farm.

“Typical negligent penalties range from a warning letter to penalties of 1-5% per breach, with intentional breaches uncapped and upwards of 15%.”

Failure to protect hedgerows and watercourses accounted for 10% of breaches in 2012, well over twice year earlier levels. 69% of those lost 5% or more of their single payment.

“The most common problem is cultivating, spraying or fertilising too close to the boundary,” said Mr Brown.

The protection zone should be at least 2m from the centre of the hedge or watercourse – or 1m from the top of the ditch bank, whichever is greater. If more than 500m of the protection zone is lacking by more than 0.5m this could incur a 5% penalty.

Good manual records or computer packages can help to calculate the correct level of inputs for a field, taking account of any area reductions.

“Beware of anomalies in the records which could flag up over-applications upon inspection,” he added. “An inspector may go back into your purchase records – an inspection really is comprehensive and can take days on a large farm, so you need to make sure everything is as it should be.”

Most farms already fall within a Nitrate Vulnerable Zone, but following a review this year some boundaries have changed. Farmers should therefore check the maps carefully, and ensure they comply with the regulations.

“In 2012 10.5% of breaches related to NVZ rules, with more than 70% of those losing 5% or more of their SFP,” he said. “Make sure you observe margins, and keep records of your fertiliser and manure applications, with particular emphasis on keeping within the maximum nitrogen application for the farm.”

To offer farmers peace of mind, Brown & Co is launching a Farm Compliance Health Check, where consultants visit the farm and examine the main areas that would be considered by an inspector.

“We can also do a more thorough audit if there are a number of breaches,” said Mr Brown. “If the farm is in an environmental scheme we can include that in our checks, as failure to comply with the scheme can result in similar payment penalties.”

 

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