Defra Secretary Michael Gove has promised to ‘look into’ the possibility of paying interest to farmers waiting for delayed stewardship cash.
Farm groups have welcomed the move, with NFU deputy president Guy Smith saying there was a ‘strong moral and legal case’ for interest to be paid to agreement holders where the amounts of money involved were significant and ‘very overdue’.
Mr Gove was quizzed on the subject by Bishop Auckland Labour MP Helen Goodman during Defra questions in the House of Commons last week (June 20).
Asked whether farmers who had been waiting 18 months for payment would receive interest, the Secretary of State said: “The honourable lady… makes a fair point, and I will look into it.”
His comments came just one day after Paul Caldwell, chief executive of the Rural Payments Agency (RPA), which has recently been given responsibility for making stewardship payments, told the BBC he ‘did not want to get into’ any talk of compensation.
Speaking on Farming Today last Wednesday (June 19), Mr Caldwell said: “Compensation is not due under the scheme.
“The key point is we want to end the uncertainty and make payments to as many people as quickly as possible.”
But the NFU’s Mr Smith disagreed.
“I have heard from a number of members recently who are waiting for payment, only to receive a letter from the RPA advising them of a possible penalty,” he said.
“To add insult to injury, the letter goes on to say the penalty will incur interest if not paid promptly.
“If ever there was a situation which brings to mind the phrase ‘what is sauce for the goose should be sauce for the gander,’ it is this one.”
Susan Twining, chief land use policy adviser at the CLA, was also supportive of the idea of interest payments being made to farmers.
“Businesses in any sector which miss payments are often subject to financial penalties, and there is little reason why a similar approach should not apply to environmental or countryside stewardship payments,” she said.
“These should, at the very least, include additional interest payments.”