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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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Environmental Stewardship

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ENVIRONMENTAL STEWARDSHIP CHANGES AHEAD

 Natural England have recently released updates on some of the potential changes to Environmental Stewardship (ES) under the CAP reform proposals, which provide a flavour of the intended changes.  However please note these are all draft proposals and subject to final agreement and implementation:

  • The final start date for ELS/HLS Agreements under existing ES schemes is the 1st December 2013.  ELS Applications will need to be with Natural England by 1st September 2013 (and HLS agreements earlier) to achieve this final start date.
  • New Environmental Land Management Schemes (NELMS) under the next regime of the CAP Reform will not commence until 1st January 2016; and all Agreement start dates will be the 1st January each year – there will be no monthly start dates.
  • Inevitably, there is a gap between December 2013 and 2016, known as the ‘transitional period’.  Currently, the following proposals are in place:
  • 2014, for Agreement Holders who have ELS Agreements which expire in 2014 (approximately 2,000) – to either extend their existing schemes in 2014, or begin a new Agreement using the current ES scheme rules – both of these options will be within the new budget, therefore the more money which is spent on transitional arrangements means there will be less available for NELMS in the future;
  • 2015, Currently 2015 is not defined as a transition year, therefore there are currently no proposals in place for the 12,000 ELS Agreements which are likely to expire.
  • The proposals for the NELMS in 2016 and beyond:-
  • ‘Lower tier’ – a national scheme open to all (similar to ELS) but with limited management options and capital items, with more emphasis on providing advice to landowners (similar to Catchment Sensitive Farming);
  • ‘Middle tier’ – targeting geographical/landscape priorities – agreements by invite only with simple management options and limited capital items;
  • ‘Upper tier’ – targeting designation areas to provide schemes for complex or demanding sites such as SSSIs – agreements by invite only with capital items available for special projects.
  • Depending on the outcome of the “greening” proposals under the CAP reform, and the availability of budget for Environmental Stewardship, it may be possible that only the middle and upper tier agreements are implemented, which will be targeted to deliver more significant benefits.
  • The Defra policies and objectives for formulating the NELMS and management options are based on EU directives such as water, biodiversity, landscape, climate control.
  • It is anticipated that there will be a single IT system for all CAP schemes, including the Single Payment Scheme (or equivalent) and NELMS, which shall include preparing and submitting applications, and submitting claim forms.

If you would like further advice on changes to Environmental Stewardship, or require assistance completing your ELS renewal in 2013 please contact Laura Gaydon of Sheldon Bosley on 01608 661666 or lgaydon@sheldonbosley.co.uk