Industry Eye: Be aware of the rules regarding cross compliance as any breach could prove costly for the business

Over the coming weeks farmers will be submitting their 2011 claims and, later in the year, SFP will be a focus again as payments are due. The rules for cross compliance often receive less attention, but they need to be borne in mind throughout the year, if financial penalties are to be avoided.

Whilst cross compliance is generally associated with Single Payment, it also applies to Environmental Stewardship agreements and to some elements of the English Woodland Grant Scheme. Where a business is receiving payment under more than one of these schemes, a breach can result in multiple penalties.

There is a strong argument that much of cross compliance is common sense and that, to a large extent, the rules are satisfied through day-to-day farming activities. However, farmers still need to be aware of the requirements and how they impact on their business.

The Rural Payments Agency recently published details of cross compliance breaches found during 2010 which resulted in Single Payment reductions approaching £2.1m. Whilst there have been improvements over previous years with regard to the cattle identification and animal welfare elements of the rules, these remain the ‘chart toppers’ and together account for almost 70 per cent of breaches.

What can be classified as resource protection issues, particularly relating to soil and water, made up the majority of the remaining cases. Being unable to provide an up-to-date Soil Protection Review booklet resulted in 80 inspection failures; 67 of which led to a Single Payment penalty of 5 per cent or more.

A new booklet was issued to farmers in December 2009 and should have been filled in by the end of last year.

The number of failures to comply with the revised Nitrate Vulnerable Zone Regulations increased in 2010. Whilst there is potential to breach the regulations through practical activities, e.g. applying manures or fertiliser during closed periods, incomplete, or non-existent, statutory records and calculations are more likely to cause inspection failures.

Inadequate record keeping is a common contributor to inspection failures across the cross compliance regime. These record keeping requirements are regarded by many farmers as a part of an increasing bureaucracy that is hampering UK agriculture.

There is optimism that the review being undertaken by the Farming Regulation Task Force will lead to a reduction in red tape at a national level.

Whilst this would reduce the burden on farmers, cross compliance rules of some form or other will almost certainly remain in place as governments attempt to balance productivity with social and environmental responsibility. Few farming businesses can afford to incur payment penalties, so failing to know the rules and meet the requirements cannot be considered an option.

* David Wadsworth of farm business consultants Andersons. Tel 0303 313 0001. Mobile 07759815116. [email protected]