Friday, December 15, 2017

Brexit boost to support payments – but costs rise

December 1, 2017 by  
Filed under News & Business

Farmers will receive a boost in their basic payments this month – driven by the fall in the value of Sterling following last year’s decision to leave the European Union.

The Rural Payments Agency has pledged to deliver at least 91% of basic payment scheme (BPS) payments to farmers this month – matching or surpassing last year’s performance which saw 78,000 of eligible claimants receive their money by the end of December.

Defra minister George Eustice confirmed an increase in entitlement values and greening rates last month. Coupled with the favourable BPS exchange rate confirmed in September, basic payments will be worth 25% more on average this year compared to 2015.

Payments under this year’s BPS will reach bank accounts from 1 December. Mr Eustice said: “Exchange rate changes since the decision
to leave the EU have led to a recovery in many farming sectors and BPS payments next year will be 25% higher than in 2015.”

Farmers must hold an entitlement for every hectare of eligible land they claim on. The size of farmers’ payments will depend on how many entitlements they use, supported by eligible land and the value of those entitlements.

The greening part of payments is calculated by taking the number of entitlements used with eligible land to claim payment and multiplying it by the greening value. Again this is higher than in 2015 but slightly lower than in 2016.

But farm input costs have also risen. There was a 4.92% increase in the average cost of agricultural production inputs during the 12 months to September 2017, according to the latest AF AgInflation Index from the Anglia Farmers buying group.

NFU adviser Richard Wordsworth said farmers should check their BPS payments carefully. He said: “It is clear to me again this year that a number of BPS payments are not going to be accurate in the eyes of the recipient.”

Discrepancies between what a farmer expected to receive and what the RPA issued as a payment continued to be a feature of the system, said Mr Wordsworth. This could be due to inaccurate data or erroneous mapping he added.

Rules were complex, said Mr Wordsworth – and the RPA was not always right. “The approach taken by the RPA is now more than ever focused on paying on what it believes is correct at the time of calculating the payment, based on the data it sees as being accurate.”

Entitlements and Greening

                                       2017                   2016                2015

Entitlement value         €180.46             €175.27              €171.83

Greening rates                €77.69               €77.71                 €76.19

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