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Chair's statement on managing disallowance risk

13 July 2015

A statement from Meg Hillier MP, Chair of the Committee of Public Accounts:

"The complexity of the Common Agriculture Policy (CAP) is legend. But the Department's poor performance in terms of mapping capability, paying farmers on time, and weak compliance with European Commission requirements has seen the English taxpayer hit by £642 million in fines. The result is that the Commission gets to hold back vast sums of money which should be going to support farmers or rural development programmes in England.

These penalties mean the UK has paid fines worth £2.70 for every £100 of funds received under CAP since 2005. The UK is in the embarrassing position of having the sixth highest figure out of all 28 member states for penalties incurred as a share of funds received.

The frightening thing is that the current CAP is more complex than the scheme it replaces, despite the UK's efforts to simplify it. With further changes planned to the system for processing grant claims and payments, and the recent introduction of new regulations and controls as part of CAP reform, the UK appears to face the very real risk of increased financial penalties in the future. Complicated CAP rules don't help but the Department must get a grip to deal with these persistent problems and ensure we aren't throwing away taxpayers' money on financial penalties."

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