Farm subsidy payment delays ‘unacceptable’, committee says

The EFRA committee said it was unacceptable that UK farmers are still facing lengthy delays in rec

The EFRA committee said it was unacceptable that UK farmers are still facing lengthy delays in receiving their farm subsidy payments. - Credit: PA

It is “unacceptable” that UK farmers are still facing lengthy delays in receiving their farm subsidy payments, a parliamentary select committee says.

The Environment, Food and Rural Affairs Committee, which has produced a report of farm gate prices, warned farmers in the UK were at risk of suffering further cash flow problems if the Rural Payment Agency (RPA) does not commit to fixing ongoing issues with its IT systems.

EFRA committee chair Neil Parish MP said: “Many producers rely on Common Agricultural Policy (CAP) payments to turn a profit so it is unacceptable that our farmers are still facing lengthy delays to financial support.

“The RPA introduced an IT system that wasn’t fit for purpose and subsequent errors made in the attempt to fix the problem only caused further delays and confusion for applicants. We welcome the efforts being made to solve this problem and reduce delays but it is crucial that the RPA works to at least match the target achieved by the previous scheme of 90% of payments made by the end of December each year.”

National Farmers’ Union (NFU) president Meurig Raymond said such a move would alleviate the financial turmoil faced by thousands of farmers.

“We will be pushing this recommendation in our own discussions with the RPA,” he said.

The report also found that current legislation surrounding origin labelling has the potential to mislead consumers and cause confusion. MPs found that a growing interest in the provenance of food and in British products requires a move towards clearer labelling.

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“Many people in Britain want to support a British agricultural industry,” said Mr Parish.

“But the Department for the Environment, Food and Rural Affairs’ (DEFRA) current guidance on origin labelling allows for companies to sell products such as cheese and butter as British when the raw product is being sourced oversees. As a result consumers are given a false impression that they are supporting a home industry when in fact their money is not supporting UK farmers at all. The British public deserve to buy British in confidence.

“DEFRA must strengthen its guidelines around country of origin labelling and continue to press for EU support in establishing clearer and better labelling requirements.”

The committee questioned assurance from the retail sector that there is no link between the price at which supermarkets sell to their customers and the price supermarkets pay to farmers.

The chronic low price of milk sold through supermarkets inevitably disadvantaged farmers in the longer term, it said. Supermarkets may choose to sell milk cheaply as a loss leader, but farmers must not be the victims of the supermarket wars currently taking place in the UK.

More effective co-ordination between DEFRA and the devolved administrations was needed to prevent unsustainable price inequalities emerging at a national level, it added.

It also said that farmers should the strength they can achieve through being part of a producer organisation, and that the agricultural industry needed to look at developing global products or adapting traditional products to meet changing demands.

Mr Raymond said: “The fall in prices and associated cash-flow problems are the biggest challenges currently facing our farmer members. And we’re not expecting the market situation to get better anytime soon.

“We are pleased that the EFRA committee has listened to our evidence and to others from across the supply chain and produced this wide-ranging report.

“There is no quick-fix. However the report identifies a range of recommendations that can help in the short-term and not leave the industry so exposed in the future. Our members now expect to see this swiftly followed up with positive, visible and tangible actions.”

The EFRA Select Committee report into farm gate prices follows a three month enquiry. The farming and food sector is worth more than £100billion a year to the UK economy and supports one in eight jobs.