Under the provisions of the single payment scheme any farmer receiving direct payments must respect the various statutory management requirements set down in EU legislation — directives and regulations — on the environment, food safety, animal health, and welfare, and plant health and must maintain the farm in good agricultural and environmental condition, GAEC. In general, the rate of inspection required for cross-compliance is 1% of those farmers to whom the relevant statutory management requirements or good agricultural and environmental conditions apply. However, at least 5% of producers must be inspected under the animal identification and registration requirements, as this is the level prescribed under the relevant regulations.
Where breaches of cross compliance provisions are detected the level of penalty to be applied will be determined on the basis of an assessment of the importance of the non- compliance set out in the control report. If the non-compliance is due to negligence then, normally, the penalty is 3% of the aid for the year in question. However taking account of the permanence, extent or severity of the non-compliance the 3% penalty may be reduced to 1% or increased to 5%. If repeated non-compliance is found then the penalty established will be multiplied by three up to a maximum of 15% of the aid.
If intentional non-compliance is found then the penalty is 20% of the direct payments referred under Council Regulation 1782/93 for the year in question. However, on examination of the control report and taking account of the permanence, extent or severity of the non-compliance the 20% may be reduced to 15% or increased to 100%.
Under the new rules relating to cross compliance, where provisions relating to the requirements or standard in question leave a margin not to pursue the non-compliance found the control report shall make a corresponding indication, and it may be possible not to apply any reduction in such cases. The extent to which this provision can be used is very limited but my Department is examining this provision with a view to clarifying to what extent, if any, it can be used to underpin a warning system