Guidance

Greening Administrative Penalties

Changes to greening penalty arrangements

• From: Rural Payments Agency and Department for Environment, Food & Rural Affairs
• Published: 16 November 2017

We confirmed in the 2017 Basic Payment Scheme (BPS) scheme rules (page 98) that the rules about Greening Administrative Penalties were being discussed with the European Commission (EC) and we would publish further details when they were available.

Details of these penalties have now been confirmed by the EC and they will be applied from the 2017 scheme year onwards.

You can read more details below.

Updates for BPS 2017

• No Greening Administrative Penalties will be applied in the 2015 and 2016 scheme years.

• These are new penalties which can be applied to your greening payment. These are being introduced for the first time in 2017.

• These penalties are in addition to the reductions that may have been applied for non-compliance with the greening rules in 2015 and 2016 and which continue to be applied (see pages 93 to 95 of the BPS 2017 scheme rules).

• The ‘greening’ rules farmers have had to comply with to qualify for the greening payment in 2017 and the previous scheme years, have not changed.

How Greening Administrative Penalties work

• The Greening Administrative Penalties calculation is based on the size of the reductions applied to the greening payment for non-compliance with the Crop Diversification (CD), Ecological Focus Area (EFA) and/or Environmentally Sensitive Permanent Grassland (ESPG) greening requirements.

• If you have received a penalty for over-claiming eligible land for BPS and Young Farmer schemes where the over-claim is either greater than 3% or 2 hectares of the area determined, you will not automatically receive a Greening Administrative Penalty.

The example below shows where a BPS penalty has been applied, but there is no Greening Administrative Penalty:

Example 1

A farmer has claimed 50 ha of arable land on their BPS application, meaning they need 2.50 ha for EFA (5% of 50 ha).

They have claimed 4.50 ha for EFA meaning they have claimed 2 ha more than they need to for EFA. This is acceptable under the greening rules and no over-claim penalty is applied for EFA as they can claim more than 5%.

However, RPA has carried out an inspection and found the area of EFA to be only 2.50 ha due to an ineligible feature on the land. This means the EFA still meets the 5% requirement but the BPS eligible area found is 2.00 ha less than the farmer claimed (48 ha instead of 50 ha).

As the difference between the BPS eligible area claimed and the area found is 4%, an over-claim penalty will be calculated as described on Page 97 of the BPS rules for 2017 published at www.gov.uk.

However, the farmer is still compliant with the EFA greening rules and will not incur greening payment non-compliance reductions or Greening Administrative Penalties in this instance.

• From the 2017 scheme year, Greening Administrative Penalties will apply when the greening payment reductions for non-compliance with the greening rules are greater than either 3% or 2 ha of the determined area that the greening payment is calculated on (see page 90 of the 2017 BPS Scheme rules).

The example below shows where greening payment non-compliance reductions have been applied, but they do not trigger the additional Greening Administrative Penalties:

Example 2

Crop Diversification

A farmer has a claimed area of 100 ha of arable land, which means they have to grow at least 3 different crops on it. The main crop for crop diversification purposes covers 75.25 ha and the 2 main crops cover 95.10 ha. This means the farmer isn’t meeting the greening rules because:

• the main crop exceeds 75% by 0.25 ha

• the 2 main crops exceed 95% by 0.1 ha

RPA would apply the following greening payment non-compliance reductions:

• 1 x 0.25 = 0.25 ha

• 5 x 0.10 = 0.50 ha

So the farmer’s total crop diversification greening payment non-compliance reduction is 0.75 ha. This means the crop diversification part of the greening payment will be for 99.25 ha of the arable land.

Ecological Focus Area

The same farmer only has 4.90 ha worth of EFA which means they are 0.1 ha short of what they should have for EFA (because 5% of 100 ha is 5.00 ha).

RPA will apply the following greening payment non-compliance reductions:

• 0.10 ha x 10 = 1 ha

So the farmer’s total EFA non-compliance reduction is 1 ha. This means the EFA part of the farmer’s greening payment will be for 49 ha of their arable land.

Total greening payment non-compliance reductions for CD and EFA = 1.75 ha. This means that their greening payment will be based on a reduced area of 98.25 ha.

As the sum of crop diversification and EFA non-compliance payment reductions (page 93) is 1.75 ha, the difference is less than 2 ha or 3% of 98.25 ha. This means that Greening Administrative Penalties will not apply in this instance.

The example below is based on the same as above, but where larger Crop Diversification (CD) and Ecological Focus Area (EFA) non-compliance reductions apply to the farmer’s claim. This will result in an additional Greening Administrative Penalty:

Example 3

Crop Diversification

A farmer has a determined area of 100 ha of arable land, which means they have to grow at least 3 different crops on it. The main crop covers 77 ha and the 2 main crops cover 96 ha.

This means the farmer isn’t meeting the greening rules because:

• the main crop exceeds 75% by 2 ha

• the 2 main crops exceed 95% by 1 ha

RPA would apply the following greening payment non-compliance reductions:

• 1 x 2 = 2 ha

• 5 x 1 = 5 ha

So the farmer’s total crop diversification reduction is 7 ha. This means the crop diversification part of their greening payment will be for 93 ha of their arable land.

Ecological Focus Area

The same farmer only has 4.75 ha worth of EFA which means they are 0.25 ha short of what they should have for EFA (because 5% of 100 ha is 5.00 ha).

RPA will apply the following reductions:

• 0.25 ha x 10 = 2.50 ha

So the farmer’s total EFA reduction is 2.50 ha. This means the EFA part of the farmer’s greening payment will be for 97.50 ha of their arable land.

Total greening payment non-compliance reductions for CD and EFA = 9.50 ha. This means their greening payment will be based on a reduced area of 90.50 ha.

As the sum of crop diversification and EFA payment reductions (9.50 ha) is more than 2 ha or 3% but less than 20% of the area that the greening payment is paid on (90.50) ha, Greening Administrative Penalties will apply as follows:

Greening Administrative Penalty

If the average greening rate is €75 and the farmer’s greening payment is based on a determined area of 100 ha of arable land, they will receive €7,500.

However RPA has found that they have 90.50 ha because the sum of the crop diversification, and EFA non-compliance reductions is 9.50 ha.

As the difference of 9.50 ha equals 10.49% of 90.50 ha, a penalty of twice the difference (2 x 9.50 ha = 19 ha) will apply. The determined area will be reduced to 71.50 ha giving the farmer a payment of:

(€75 x 71.50 ha) = €5,362.50

However for 2017, the penalty will be divided by 5 (and limited to 20% of the greening payment, see below). This results in a penalty of 3.80 ha to be deducted from the 90.50 ha, leaving 86.70 ha to be paid on. This gives the farmer a new payment of:

(€75 x 86.70 ha) = €6,502.50

Limitations

• In the 2017 scheme year, the size of the Greening Administrative Penalty will be limited. It will be divided by 5 and will not exceed 20% of the total greening payment due.

• From the 2018 scheme year onwards, the size of the Greening Administrative Penalty will also be limited. It will be divided by 4 and will not exceed 25% of the total greening payment due for that scheme year.

Greening Administrative Penalties where the area claimed is less than the area found

• Greening Administrative Penalties may apply where an on-the-spot check finds the claimed arable area on your holding which is used for determining compliance with the greening rules, is more than 0.1 ha less than the area found, and you have benefited from a greening exemption from crop diversification and/or EFA rules (see pages 38, 39 and 42 of the 2017 BPS Scheme rules).

• However, you will only receive a Greening Administrative Penalty if the additional arable area found means that you are no longer eligible for the greening exemption (see pages 38, 39 and 42 of the 2017 BPS Scheme rules).

• If this is the case, the Greening Administrative Penalty will be a 10% reduction in the area on which the greening payment is based.

• If the ESPG area claimed is less than the ESPG found by more than 0.1 ha, there will be a 10% Greening Administrative Penalty reduction in the area on which the greening payment is based.

• Where both arable and ESPG reductions are needed, the maximum Greening Administrative Penalty is limited to 10% of the area on which the greening payment is based.

How will I know if I have a Greening Administrative Penalty?

• Where a Greening Administrative Penalty applies to your 2017 BPS claim, the penalty will appear on your 2017 BPS Claim Statement.

• If you disagree with the penalty, fill in a payment query form and return it to us by post or email. Find the form by searching ‘BPS payment query form’ at www.gov.uk.

Difference between the total of CD, ESPG or EFA area reductions for non-compliance with the greening rules as a proportion of the reduced determined area that the greening payment is based on	Size of penalty
Up to 3% or 2ha	No penalty
More than 3% / 2 ha and up to 20%	The area of greening payment is reduced by twice the total non-compliance reduction (subject to penalty limitations explained above).
More than 20% and up to 50%	Area of greening payment is reduced to zero (subject to penalty limitations explained above).
More than 50%	Area of greening payment is reduced to zero and a further penalty based on the greening payment x area of greening non-compliance reduction (subject to penalty limitations explained above)

Published 16 November 2017