Farm payments 'master class in bad decisions'

MPs slam farm subsidy payments

Thursday, 06, Sep 2007 12:00

MPs have singled out two senior officials over the government's failure to pay subsidies to English farmers on time.

The Commons Public Accounts Committee (PAC) has described Defra's handling of the single farm payment scheme (SPS) as a "master class in bad decision making".

Through the Rural Payments Agency (RPA), Defra is responsible for allocating £1.5 billion from the SPS to farmers.

Nearly all of the payments for 2005 were supposed to be with farmers by March 2006, but by October last year 3,000 English farmers were still awaiting payment.

Only 15 per cent of farmers received funds on time, with PAC concluding Defra and the RPA "underestimated" the work required.

PAC further criticised the RPA for attempting to implement complex reforms in the shortest possible time.

Chairman Edward Leigh singled out Johnston McNeill, the former head of the RPA, for criticism, saying he had not confronted Defra with the project's problems.

Mr Leigh said: "This was a highly risky project from the outset but the agency's chief executive recoiled from confronting his Defra bosses with reality.

"McNeill paid the price for what happened but the then permanent secretary of the department, Sir Brian Bender, bears a large part of the responsibility."

PAC called for senior managers to be held more accountable for the system's failings.

The failures were also blamed on the multi-million IT system overseeing the payments, as well as an unrealistic timetable, weak risk assessment and poor communication with farmers.

Mr Leigh continued: "Its implementation last year to a near-impossible timetable was a master class in bad decision-making, poor planning, incomplete testing of IT systems, confused lines of responsibility, scant objective management information and a failure by the management team to face up to the unfolding crisis".

He added: "The story of the inept handling of the scheme…should make a richly rewarding study for senior civil servants across the whole of government for some time to come."

Defra maintained its targets for 2006 had been met.

Nevertheless, Chris Huhne, Lib Dem Defra spokesman, said the Labour government had been an "unmitigated disaster" for rural Britain.

He said: "The problems with the new single payments scheme were obvious. While Wales and Scotland introduced their changes with minimal problems, Defra wasted hundreds of millions of pounds of taxpayers' money in England.

"This money was wasted without any benefit to the farming community. Many were pushed close to financial ruin with less than one in five farmers being paid by the deadline."