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Brexit and cross-compliance

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Does Brexit mean an end to Cross-Compliance?

That is the Government’s plan for England. Cross compliance is a core feature of the CAP direct payments regime and rural development agri-environment schemes. Leaving the EU means that the UK is no longer operating under the CAP and bound by its rules.

In its “Path to Sustainable Farming” policy paper, published at the end of November 2020, Defra has said that when it delinks direct payments it will stop using cross-compliance as the basis for regulation or enforcement of payment scheme compliance and will move to a new approach (inevitable, as direct payments will no longer be linked to land areas managed by claimants). This new approach will be co-designed with the farming sector and other stakeholders. Under current plans, “delinking” is set to happen in 2024.

Ahead of that, immediate changes to cross-compliance are planned. From 2021, Defra has said that it will move away from financial penalties being the default approach to breaches of cross-compliance rules. Instead, more proportionate measures will be used. We expect to see more in the way of warnings and constructive advice on remedying breaches from the RPA, versus an immediate post-inspection report coupled with a notification of deductions to be applied.

However, it is worth remembering that most (not all) of the cross-compliance regime is built around regulations that apply, and will continue to apply, to farmers and land managers. All statutory management requirements (SMRs) are current EU regulations, and all will continue to apply in the UK following the end of the transition period, although there is now scope for amendments to be made. The difference from 2024 will be that a breach of the regulations will not automatically result in a penalty being applied to a farmer’s direct payment or agri-environment (HLS etc.) payments. In the case of GAEC standards, these are derived from UK-specific legislation (e.g. around water abstraction and rights of way).  Again, the underlying rules will continue to apply.

What will the post-Brexit approach to regulation of farms look like?

We do not have the details yet. But we have a commitment from Defra that it will be co-designed with the farmers and stakeholders and that it will be consulted on ahead of roll-out in 2024.

It is unlikely to herald a “bonfire of regulations”, particularly given the Government’s commitment to increase animal welfare standards and environmental protection. But building on Dame Glenys Stacey’s 2018 ‘Farm Inspection and Regulation Review’ it is likely to focus on whole farm improvement rather than relying on fragmented sets of rules with inconsistent enforcement regimes. Risk modelling, earned recognition (e.g. linked to assurance schemes), greater use of remote surveillance versus on foot inspections, and more support and incentives to encourage better outcomes are likely to feature. Could we see a move to whole farm licensing, in effect a “licence to operate”, overseen by a single regulator, as part of that approach?

For further information, please contact Julie Robinson or any member of the Roythornes Agriculture Team.