Defra ‘complacent’ on rural payments failures, says PAC

16 Dec 09
The Department for Environment, Food and Rural Affairs ‘consistently failed’ to spot problems with the payment of European Union grants to farmers, MPs have said.
By Vivienne Russell

16 December 2009

The Department for Environment, Food and Rural Affairs ‘consistently failed’ to spot problems with the payment of European Union grants to farmers, MPs have said.

A Public Accounts Committee report published today criticised Defra’s ‘complacency’ over delays and errors with the delivery of the Single Payment Scheme. Poor leadership at the Rural Payments Agency, the executive body charged with administering the scheme, compounded the problems, the committee said.

PAC chair Edward Leigh said: ‘It is an extremely serious charge from this committee that negligible attention has been paid to taxpayers’ interests. The £350m IT systems underlying the [Single Payment] Scheme are cumbersome, overly complex and at risk of becoming obsolete and they continue to soak up huge sums of money.

‘The information held is riddled with error and efforts to recover overpayments have been woefully slow, haphazard and ineffective, causing anxiety and concern to farmers.’

The report represents the third PAC investigation into problems with the Single Payment Scheme in three years. Costs of administering the scheme in England continue to far outstrip those incurred in other parts of the UK. Each farmer’s claim costs six times more to process in England than in Scotland, the report noted.

Leigh cited Defra’s shifting attitudes as evidence that it was still unable to come to terms with its failure. The department first accepted and then disputed the National Audit Office’s calculation of the cost of administering each claim.

‘The [Public Accounts] Committee’s confidence in the department’s ability to cut costs in future was hardly boosted by its unconvincing explanation why its interpretation was more reliable than that of the NAO,’ Leigh said.

‘The truth is that the department has either not grasped the seriousness of what has been happening or been reluctant to face up to problems. We have now insisted, and the department has agreed, that it provide us with clear evidence of what progress has been made and explain how it is meeting the NAO’s recommendations.’

A Defra spokeswoman said: ‘Defra acknowledges that further work is required to ensure that the Rural Payments Agency can deliver an improved, reliable and cost effective service to the farming industry in the years ahead.

In September, Defra minister Jim Fitzpatrick announced that the Rural Payments Agency’s financial and operational activities as well as its management capabilities would be reviewed before it would be required to react to changes to the Common Agricultural Policy expected in 2013.

Defra said the PAC’s recommendations would prove ‘valuable’ in informing this process.

The Rural Payments Agency also drew the fire of Parliamentary Ombudsman Ann Abraham. In a report also published today she called on the agency to apologise and pay compensation to farmers affected by the maladministration of the scheme.

She said the remedies she was recommending were modest when set against the overall cost of the scheme but went beyond what Defra deemed was appropriate recompense.

‘Important principles are at stake here. My view is that an appropriate remedy should be forthcoming where injustice has been suffered as a consequence of maladministration by a public body,’ Abraham said.

Did you enjoy this article?