An important share of the taxpayer's money financing the Common Agricultural Policy (CAP) is administered by the Member States. This is the case of the direct aid channelled to farmers across the EU. In order to safeguard the financial interests of the EU ensuring that this direct aid is correctly allocated to the right farmers, Member States should operate since 1992 a system for the management and control of payments to farmers, the Integrated Administration and Control System (IACS).
What is the purpose of IACS?
According to the principle of shared management, Member States must take the necessary measures to ensure that transactions financed by the European Agricultural Guarantee Fund (EAGF) are not only actually carried out but are also implemented correctly. For this purpose, the national authorities are required to operate an Integrated Administration and Control System (IACS) in order to ensure that payments are made correctly, irregularities are prevented, revealed by controls, followed up and amounts unduly paid are recovered. Over time IACS acquired a second important function: supporting farmers in making correct declarations.
In financial terms, direct aids account for approximately 90% (around € 40 billion) of the expenditure financed from the EAGF.
How does IACS work?
IACS is the most important system for the management and control of payments to farmers made by the Member States in application of the Common Agricultural Policy. It provides for a uniform basis for controls and, among other requirements, it covers the administrative and on-the-spot controls of applications and the IT system which supports the national administration in carrying out their functions.
In essence, IACS covers an annual circular process which starts with farmers lodging their aid application for direct payments. In order to support farmers in this process, national administrations have to provide him/her pre-established information which s/he can confirm, correct or complete. It continues with administrative and on-the-spot checks performed by the national administrations in order to verify that the conditions for payment are fulfilled. It is followed by the payments to the farmers and ends with the national administration updating where appropriate the pre-established aid applications for the following year with information collected during the process.
What is the scope of IACS?
IACS is operated in the Member States by accredited paying agencies and applies to all direct payment schemes as well as certain rural development support measures which are granted based on the number of hectares or animals held by the farmer. Furthermore, it is also used to manage the controls put in place to ensure that the requirements and standards under the cross-compliance provisions are respected.
What does IACS consist of?
In physical terms, IACS consists of:
- a number of computerized and interconnected databases, in particular:
- a system for the identification of all agricultural parcels in Member States called Land Parcel Identification System (LPIS);
- a system for the unique identification of farmers, the so called farmer's register;
- a computerized database for animals in Member States where animal-based aid schemes apply;
- a system for identification of payment entitlements in Member States applying the Basic Payment Scheme.
- IT systems facilitating the smooth running of the IACS's steps, in particular for submitting/receiving aid applications and for enabling the national administration to perform controls and cross-checks of data received from farmer through his/her aid application.
What is the legal basis for IACS?
The legal requirements concerning IACS are laid down in European Parliament and Council Regulation (EU) No 1306/2013 on the financing, management and monitoring of the common agricultural policy, in Commission Regulation (EU) No 640/2014 laying down the delegated rules and in Commission Regulation (EU) No 809/2014 laying down the implementing rules.
|Over the time, IACS has demonstrated its effectiveness to limit the risk of irregular expenditures.|