CAP REFORM UPDATE

Some progress in the decision making for the CAP Reform……….

Recent announcements have confirmed some progress in the decision making for the CAP Reform, however many details are still yet to be decided. The main agreed principles are as follows:

1. The existing Single Payment Scheme Entitlements will be rolled forward into the new Scheme, becoming ‘Basic Payment Entitlements’.

• The number of Entitlements a claimant holds on 31st December 2014 will be the number that    he will hold under Basic Payment Scheme (BPS) from 1st January 2015.

• Where a farmer holds more BPS Entitlements than eligible land declared in 2015, any excess Entitlements will be lost

2. The three current payment regions in England will remain the same, being non-SDA, SDA outside the Moorland, and Moorland SDA.

3. Member States can apply their own reduction to Basic Payment Scheme payments above 150,000 euros, with DEFRA’s preference being to apply the minimum level of reduction allowed, which is 5% reduction above 150,000 euros.

4. A minimum claim size of 5 ha will be introduced.

5. DEFRA will implement a Young Farmer Scheme, giving an additional 25% payment to qualifying Applicants for the first five years of setting up their Holding. The individual must not be over 40 years old in the year they submit their BPS claim and have set up as Head of Holding in the preceding five years.

6. Crop diversification will apply as follows:

• Less than 10 ha arable area – no crop diversification;

• 10 ha to 30 ha of arable area – claimants must grow at least two different crops with main crop not covering more than 75% of arable area;

• More than 30 ha of arable area – claimants must grow at least three crops with main crop not covering more than 75% of arable area. Two main crops must not cover more than 95% of arable area;

• Winter and spring varieties will count as separate crops.

7. Permanent grassland will be monitored on a national level, with baseline figures restricted to falling by less than 5%;

8. Ecological Focus Areas (EFA’s) are applicable where an applicant has more than 15 ha of arable land – 5% of the arable area must be delivered as EFAs, including fallow land, terraces, landscape features, buffer strips, agro-forestry, uncultivated land adjacent to woodland, short rotation coppice, catch crops/green cover and nitrogen-fixing crops.

Trading is on the Up

Prices seen for Entitlement trading has already risen this season, and it is expected that owners with Naked Acres will look to purchase Entitlements to match their land area ready for 2015. Those with excess entitlements should consider selling as from 2015 any excess entitlements will be lost.

If you have any Entitlements to sell, or are looking to purchase please contact our Rural Land Agency team on 01608 661666.

For further advice on the CAP Reform and how this may affect your business or current farming arrangements, please call Rosemary Smith or Laura Gaydon on 01608 661666.

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