Spending watchdog slams Defra/RPA over SPS penalties

The National Audit Office’s (NAO) has published a series of highly critical reports of Defra and RPA’s mishandling of the Single Payment Scheme (SPS) over the years.

The latest notes that the European Commission recently confirmed disallowance penalties of £160 million, including £132m related to the SPS in 2005, 2006 and 2007.

Defra’s accounts also include provision for a further £220 million of disallowance penalties, including £171m for the SPS in 2007, 2008 and 2009.

The NAO said the penalties, which result in UK money disappearing back to EU coffers, have been incurred ‘as a direct result of weaknesses in the management and administration’ of the RPA.

Both the RPA’s and Defra’s accounts have also been ‘qualified’ on the grounds that the agency has not been able to make an accurate assessment of the value of overpayments and underpayments made to farmers since the SPS began.

Two new NAO reports on Defra and RPA said progress in improving the agency had been ‘slow and costly’, despite previous assurances that issues were being addressed, and that it was still beset with problems. These included well documented concerns over the agency’s ‘expensive and cumbersome’ IT systems, the high administrative cost per claim, and management and governance weaknesses.

NAO head Amyas Morse said: “This is the second time we have qualified the accounts of Defra on regularity grounds.

“Material sums have been used for purposes not intended by Parliament, in this case paying penalties for maladministration to the European Commission. Qualifying the accounts of the Department on this basis indicates that the values concerned are very considerable, meaning that there has been significant loss to the taxpayer.”

The NAO reports come a week after the publication of a damning Defra review of the agency lead to the departure of chief executive Tony Cooper, with two more senior management figures set to go in autumn.

Farming Minister Jim Paice announced on Wednesday that Richard Judge, currently chief executive of the Centre for Environment, Fisheries and Aquaculture Science, will take over as interim chief executive on Monday (August 2). He will remain in the post for ‘three to six months’ while a permanent chief executive is recruited.

An RPA spokeswoman said the issues raised in the NAO reports had been covered in the Defra review and that ‘actions have already been taken to address many of the recommendations’.

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