Single Payment Scheme - Guidance on 2005 Penalties
Explanation of SPS Penalty Codes
Introduction
A payment statement and guidance document Understanding your payment statement (SP18) is sent out within a few days of customers receiving their SPS payment. This payment statement contains information about your payment, including descriptions of any penalties which have been applied.
Penalties can be applied to an SPS (and associated schemes) application for a variety of reasons: late declaration, inaccuracies in the application, or failure to meet cross compliance or set aside management rules, for example. An explanation of the penalties and how they are applied can be found at Section Q of the SPS Handbook and Guidance for England 2005 and Section P of the SPS Handbook and Guidance for England 2006.
The size of the penalty will depend on the issue found. For example, the size of a land penalty will depend on the amount of invalid land that was claimed. The size of a late submission penalty will depend on the number of days after the deadline the submission was received.
The payment statement will include lines showing the financial effect of the non-valid area deduction and any penalties that may have been applied.
What is shown on the Payment Statement
The payment statement that is sent to customers has five main sections:
Payments
Modulation
Financial Discipline
Penalties and Deductions
Payment Due
These sections have been explained in Understanding your payment statement (SP18) sent with the Payment Statement. A copy of this is on the RPA website.
Detailed Description of Penalty and Deduction Codes
Invalid Area Deductions
Codes used on payment letter:
This code is used to show the financial effect of deducting areas found to be invalid (for example land that is not eligible for the scheme) from the area claimed on an application. There is a separate code used for deductions made for each of the crop groups (i.e. SPS Irregularity, SPS Irregularity (Protein Premium), SPS Irregularity (Nuts Premium) and SPS Irregularity (Energy Premium).
Penalties Based on Size of Invalid Area Deduction
Codes used on payment statement:
- SPS Other penalty (irregularity between 3% or 2ha and 20% for 'crop group')
- SPS Other penalty (irregularity >20% for ‘crop group’)
- SPS Other penalty (irregularity >30% for ‘crop group’)
- SPS Other penalty (irregularity >50% for ‘crop group’)
If the invalid area deducted from the claim is greater than certain threshold levels, an additional penalty is applied. The four codes are used to show that a penalty has been applied and which threshold level has been breached. The codes include the description of the appropriate crop group i.e. Base SPS, Energy, Nuts and Protein.
If the deducted invalid area for any particular crop group is above 3% or 2ha, but no more than 20%, then the penalty will be twice the invalid area.
If the deducted invalid area for any particular crop group is above 20% then no aid will be paid for the crop group concerned.
If the area declared on the application exceeds the
overall area (all crop groups) actually found by more than 30%, no aid will be paid in that year on SPS or other schemes covered by the application. An ‘…irregularity>30%…’ code description will be shown for each of the crop groups on your application.
If the area declared on the application exceeds the
overall area (all crop groups) actually found by more than 50%, a '3 year' penalty is applied. An ‘…irregularity>50%…’ code description will be shown for each of the crop groups on your application. In this case, as well as receiving no aid in that year, the customer will have the same amount deducted from claims over the next three years. The amount will be offset against claims made in those years.
Late Penalties
Codes used on the payment statement:
- Late Penalty for late submission ( percentage )
- Late Penalty to establish entitlements ( percentage )
- Late Penalty at land parcel level ( percentage on parcel national grid code )
These penalties are for late submission of a claim, late establishment of entitlements or late modifications to a land parcel.
Penalties for late claim submission are calculated at 1% per working day between 16 May and the latest date for submission of applications (which for 2005 was 10 June 2005). Claims received after the latest date for submission of applications (10 June) have been refused. The penalty percentage that has been applied is shown on the line on your payment statement.
Penalties for late establishment of entitlements are calculated at 3% per working day between 16 May and 10 June 2005. The penalty percentage that has been applied is shown on the line. As entitlements were established via the SPS application form, if you submitted your 2005 application form late two late penalty lines will have been shown on the 2005 payment statement, one for late submission and one for late establishment of entitlements.
Penalties on late land parcel changes are calculated at 1% per working day after 31 May 2005. Amendments received after 10 June cannot be accepted under the scheme rules. Both the penalty percentage that has been applied and Ordnance Survey national grid code of the affected parcel are shown.
Non-Declaration of Land and Non-Compliance Penalties
Codes used on the payment statement:
- Non Declaration of Land Penalty
- Non Compliance Penalty. Click here for Cross Compliance Inspection Statistics for the 2005 Calendar Year.
A non-declaration of land penalty is applied if not all the agricultural land is declared. For a difference of up to 3%, no penalty is applied. For differences of more than 3%, a penalty of 1% to 3% of the payment will be applied, depending on the percentage of the non-declaration.
A non-compliance penalty is applied for failure to meet relevant cross compliance standards (including set-aside management rules). A penalty is applied as a percentage of the whole claim value.
2005 Penalty figures
These figures are currently being updated.
Click
here for Cross Compliance Inspection Statistics for the 2005 Calendar Year.
Page published: 20 September 2010