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Allocation of Entitlements in 2014

Following the draft CAP Reform proposals that were published in Autumn 2011 we are expected to see a new process for the allocation of entitlements in 2014 or 2015 (if negotiations are delayed).

All entitlements under the current Single Farm Payment scheme will cease in 2014.  A fresh allocation of entitlements will then be established on the land at the claimants disposal in the first year of the new scheme.

In order to activate new entitlements a claimant will need to have successfully “activated at least one payment under the Single Payment Scheme” in 2011 as well as being an “active farmer” and have land “at his disposal”.

We can already see the consequences of such a draft as clients contact us to ask:

  • The business that claimed in 2011 has now been split and a new business(es) formed.  How will they activate new entitlements in 2014?
  • Land was rented out in 2011. How will the new occupier activate new entitlements in 2014.
  • Land being sold between now and 2014, especially land that is sold in lots.
  • New farmers, how will they be able to activate entitlements in 2012.

From the draft proposals, it is anticipated that we will see the following introduced:

  • A National Reserve.  As proposed this is very much aimed at young farmers (under 40).
  • A procedure to allow those farmers with 2011 status to transfer that status to a new landowner or tenant.  Such a transfer must accompany a new sale or lease by the farmer transferring his status and his 2011 status.  It must be noted that as drafted, the 2011 status cannot be split!
  • On the flip side a farmer with 2011 status should be free to take on more land in 2014 when claims for allocation are being made and therefore be able to secure more entitlements.
  • We therefore may see a market develop to enable such farmers to claim entitlements on land owned / tenanted by non qualifying persons and then pass them back.

As with the whole draft CAP reform caution must prevail before any business decision are made that may effect the allocation of entitlements in 2014.

Please remember the above is based on draft proposals which are still subject to lengthy negotiations, therefore the form and detail could change.

To discuss the Single Farm Payment Scheme or CAP reform in more detail, please contact Lucinda Clifford at the GSC Grays Barnard Castle office – 01833 637000

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