No matter what is finally agreed within the EU on the definition of a “genuine farmer”, it is likely that member states will be given flexibility in deciding just who they allocate CAP money to in the future.
It is quite easy to define what a “genuine farmer” is – it is the person actively farming a parcel of land used to draw down entitlements.
And perhaps it is also quite easy to define what a farmer isn’t – someone who leases out land while taking nothing to do with maintaining it in good agricultural condition, can hardly expect to receive direct farm payments.
The farming industry lobbied hard (in 2013/14) for a definition that would ensure direct support only went to those actively farming the land
However, there is a grey area in between, and the more member states try to tie down what a “genuine farmer” is, the more bureaucracy it potentially forces on to the farming industry.
It was a conundrum faced by Northern Ireland (NI) in the last CAP reform period. The farming industry lobbied hard (in 2013/14) for a definition that would ensure direct support only went to those actively farming the land. The reason for that goes back to the CAP reform from 2005, when EU farmers were moving to a decoupled system of payments.
In 2013, there were over 37,000 single farm payment claimants in NI
While the Republic of Ireland chose to limit future single farm payments to those who had historic claims in the reference years from 2000 to 2002, NI took a different approach, opting for a so-called static vertical hybrid model. That model included a flat-rate element worth €78.33/ha. It drew over 10,000 landowners into the system. In 2013, there were over 37,000 single farm payment claimants in NI.
By then it was becoming clear that the 2015 CAP reform involved a fundamental shift towards flat-rate payments per hectare. In NI, all entitlements were to move to an average payment of around €330/ha over seven years, starting from 2015. A landowner with a starting entitlement worth €78.33/ha was in line for a significant windfall, at the expense of those actively farming the land.
The relevant EU regulation bringing in the 2015 reforms had a relatively loose definition of what constituted an “active farmer”, but did give member states some scope to add clarity.
NI came up with wording that only “the person having decision-making power, benefits and financial risks” could claim on a parcel of land. In 2014, the Department of Agriculture wrote to those it believed were letting their land in conacre, encouraging them to transfer entitlements to the person actually producing livestock, crops, etc, off that land.
That largely worked. There were 26,500 claimants in 2015, and there are around 24,500 now.
For the majority of farmers, the “active farmer” rules have not had any impact on their ability to claim payments.
However, not all farmers own livestock or grow crops. Some claim to grow grass for sale, contract-rear heifers or are in share-farming arrangements. At its most basic level, a landowner just has to keep land in good agricultural condition, so could use a grass topper to keep land eligible for payments.
Some have managed to beat the system
The Department has in the past, challenged those without livestock, etc, to provide proof of activity, such as receipts of fertiliser purchase and proof that silage was advertised for sale. Some are genuine claimants. Some have managed to beat the system.
But perhaps the most important point to note from the experience in NI, is that even if landowners are excluded from getting future direct payments, the fact they got them in the past, means an expectation has been created.
The president of the Ulster Farmers’ Union, Victor Chestnutt, recently estimated that up to 50% of direct payments in NI either directly or indirectly end up in the hands of people who are not actively producing.
A review of the “active farmer” rules is currently ongoing in NI.