Written Answers. - Direct Payment Schemes.

Michael Moynihan

Question:

103 Mr. M. Moynihan asked the Minister for Agriculture, Food and Rural Development the efforts, if any, he is pursuing with the European Commission for a re-examination of the penalty regime applicable to direct payments and to apply proportionately to problem cases; and if he will make a statement on the matter. [4696/00]

I fully recognise the importance of direct payments to the income situation of Irish farmers. The total number of livestock applications which attracted penalties under the 1998 headage and premium schemes represented 2.6% of the 522,000 applications received in that year. In the case of REPS, 2-3% of applicants would have attracted penalties of 20% of aid. Therefore this issue has to be kept in proportion and in context.

Some two-thirds of penalties applied under the headage and premium schemes were attributable to late submission of aid applications by farmers. A further number arose because of a shortfall in the number of eligible animals found by my Department in the course of on-farm inspections.

The number of applications which attracted a one or two year penalty, that is, false declaration, intentionally or through serious negligence, represented no more than 0.1% of applications in the 1998 scheme year. The vast bulk of these applied in the sheep sector. A one year penalty would apply in cases where, for example, a proportion of ewes for which applications was made, were found not to be ewes at inspection. A two year penalty would apply where, for example, a farmer made application for premium/headage on sheep which he did not have at the time of application or at time of inspection.

In general, where an applicant makes an error in the completion of an application form, my Department allows an opportunity to correct such errors. The most common error in recent years has been the incorrect transcription of tag numbers on application forms. The level of such errors has, however, greatly decreased in the past year following the more widespread use of new information technology in the processing of the special beef premium scheme whereby farmers are no longer required to list the individual eartag number of all animals for which application is made.

Given the overall value of these direct payments to farmers and the fact that that value is set to increase following the successful outcome of the Agenda 2000 negotiations, it is inevitable that the European Commission will wish to ensure that reasonable levels of controls are in place in the various member states.
Since January 1999, greater emphasis has been placed on the need for farmers to fully respect the regulatory requirements for the identification and registration of bovine animals. These requirements are particularly important in the context of traceability and the national beef assurance scheme.
I am fully conscious of the need to simplify the application and processing arrangements for the various direct payment schemes and to ensure that penalties are kept to a minimum. In the course of the negotiations on the detailed rules for implementing the Agenda 2000 changes and in the discussions on changes to the integrated administration and control regulations, my Department raised the question of simplification and proportionality of penalties. Some success was achieved in that regard.
I am committed under the new programme for prosperity and fairness to pressing the European Commission to re-examine the penalty regime with particular reference to exclusion penalties applicable to direct payment schemes and to apply the maximum proportionality in the imposition of all penalties. I will honour that commitment.