5 July 2006 : Column 1147W

(2) how much the European Commission will fine the UK Government for missing the 30 June 2006 deadline for Single Farm Payment if (a) 85 per cent., (b) 86 per cent., (c) 87 per cent., (d) 88 per cent., (e) 89 per cent., (f) 90 per cent., (g) 91 per cent., (h) 92 per cent., (i) 93 per cent., (j) 94 per cent., (k) 95 per cent., (l) 96 per cent., (m) 97 per cent., (n) 98 per cent., (o) 99 per cent. have been paid by the deadline. [79895]

Barry Gardiner: The end of the regulatory payment window for the 2005 Single Payment Scheme (SPS) is 30 June 2006. Discussions with the European Commission suggest that a formal extension to that window is unlikely, but those discussions will continue, focussed on the application of separate regulatory requirements on the EU funding of payments. As things stand, those requirements are, in summary, that where payments made after 30 June in any member state amount to 4 per cent. or less of what was paid out before that date, no reduction in EU funding will be imposed. For any amounts outstanding after 30 June over and above the 4 per cent. threshold, reductions will apply as follows:

Furthermore, where the 4 per cent. threshold hasnot been used by 15 October, it will be reduced to 2 per cent.

Written ministerial statement by David Miliband, Secretary of State for Environment, Food and Rural Affairs on Rural Payments Agency - Wednesday 5 July 2006

In my oral statement of 22 June, I promised to keep the House informed of the Rural Payment Agency’s (RPA) progress in making payments under the 2005 Single Payment Scheme (SPS.) I can report now on the position at the end of the EU regulatory payment window on 30 June.

As was the case in previous years with the old CAP schemes, the total amount to be paid by the RPA under the 2005 SPS will not be known for certain until the last claim is completely validated. However, the latest estimate puts the figure at £1.515 billion of which over £1.438 billion (94.9%) was paid by 30 June. 91,720 claimants had received a full payment and a further 16,168 had received a partial payment and are awaiting their ‘top up’. The combined total of 107,888 represents over 92% of the revised estimated total claimant population entitled to a payment of 116,474, which now takes account of merged multiple claims from the same business and discounts duplicate claims, voluntary withdrawals and those where the claim was only to establish entitlements and not claim payment against them.

Of the estimated 8,500 claimants who have yet to receive a payment, approximately 460 currently have a claim value of more than 1,000 euro. Some of these are in a category that it is not possible to pay at present, for example because RPA is awaiting information from claimants. However, the majority require further action from the RPA and those cases will remain the Agency’s number one priority to resolve as quickly as possible.

Discussions are now underway with the devolved administrations to determine whether, for the UK as a whole, sufficient payments have been made to avoid triggering the normal EU rules on withholding EU funding of payments after the end of the 30 June payment window. Those rules allow for 4% of value payments made before the end of the window to be made after it with full EU funding. After that, a sliding scale of reductions applies, depending on timing, to payments after the 4% threshold has been exhausted. The indications are that the UK is likely to have paid between 95% and 96% of payments by 30 June. If this is confirmed, we will, as previously indicated, have further discussions with the European Commission about the application of the payment reduction rules.

In the meantime, the RPA will continue to pay the remaining claims and progress work under the 2006 scheme in line with my 22 June statement.