The European Commissioner for Agriculture and Rural Development, Mr Phil Hogan, today confirmed his intention to extend the date by which Member States may make CAP direct payments without any reductions in the rate of reimbursement from the EU to the Member States concerned. Effectively, this measure extends the deadline by which direct payments must be made from 30 June to 15 October.
Commissioner Hogan's initiative responds to the difficulties that a number of Member States/regions are currently experiencing difficulties in completing their payments before the 30 June deadline. This derogation, which can only be applied at Member State level, means that payments can continue to be made after 30 June without the application of any reductions for late payments on the Member State. Under normal rules, the reductions (applicable to the authorities) would be 10% on payments made in July, 25% on payments made in August and 45% for payments made in September.
Mr Hogan stressed that this is "an exceptional measure, which reflects the difficulties that some paying agencies have experienced with the first year of payments under the new CAP. It represents an unprecedented level of flexibility on the part of the European Commission and, based on the current levels of payments, could yield a multi-million EURO saving for those Member States/regions, and potentially their farmers, which will not have made their payments by 30 June. Based on the engagement that I have had with a number of Member States/regions, I am satisfied that this measure, which goes as far as the Commission can go, fully meets their needs in terms providing them with maximum flexibility and ensuring full reimbursement of the value of the payments".
Recognising the dependence that many farmers have on their direct payments, particularly given the impact of the current market difficulties on their cash flow situation, the Commissioner also said that "this derogation must not be used as an excuse to slow down the rate of payments and urged paying agencies to prioritise the issuing of all outstanding payments, with a view to maximising the level of payments made by 30 June. "