Delinked payments: Information statements and transfers explained

Farmers in England should now all have received a delinked payments information statement, the details of which need to be checked over and followed up on before the end of February 2024.

The statement shows the Basic Payment Scheme (BPS) data (including greening and any young farmer payments due) held by the Rural Payments Agency (RPA) for the 2020-22 reference period, which it will use to calculate the direct support to be paid from 2024 to 2027.

Richard Wordsworth, NFU senior adviser on support schemes, says farmers should make it a priority to check that their statements have arrived, so they can raise any queries as soon as possible, having read the RPA’s instructions on the statement.

See also: RPA opens BPS query window and delinked payments

“Most statements were sent out by early December, as a PDF email attachment, to the business email address held on the RPA’s system,” says Richard.

“So anyone with a business email address who hasn’t seen anything should check their inbox, spam and junk folders.

“Around 14 December, a paper version also went out in instances where the email version had bounced back, or the RPA didn’t have an email address associated with the business.

“But if you think you should have had one, and haven’t, then contact the RPA.”

Farmers without an information statement can either call 03000 200 301 or email ruralpayments@defra.gov.uk.

Eligibility

Farmers should have received a statement if they claimed BPS in 2020-22, whether for all those years or any part or combination of them.

Those who have already claimed under the Lump Sum Exit Scheme have not been sent a statement.

However, anyone who has applied to the Lump Sum Exit Scheme, but has not yet claimed should still have received a delinked statement.

This gives those farmers the choice of either receiving the delinked payment or choosing the lump sum, as long as they are in a position to submit their claim for the latter by 31 May 2024, having fulfilled the scheme rules.

Information statement details

The statement shows a reference amount – which is a monetary value – based on the average adjusted BPS data for the farming business between 2020 and 2022.

To calculate the reference amount, the RPA has divided the sum of the reference data by three.

This is the case even if no BPS claim was made in one or more of the three scheme years.

Richard says the reference data should have been adjusted to remove any penalties which may have been applied for things such as cross-compliance breaches, late applications or over claims (although the value will only reflect the land area that was considered eligible).

“People need to check back through their claim statements and associated correspondence to check they are happy with the values.”

Anyone with a query needs to complete a basic payment query form before the deadline of 29 February 2024.

This will be particularly important to do as soon as possible for anyone intending to transfer some or all of their reference data, to give the RPA time to resolve the query before the transfer takes place.

Transfers

The transfer window for reference data runs from 15 February to 10 May 2024.

Further guidance on how the transfer process will work and the information that will be required is expected to be available soon.

Farmers can choose to transfer all or part of their reference amount to another business or multiple businesses.

There are a number of different scenarios where transfers may come into play, but some farmers may not yet be aware they are affected.

These include cases where, during the reference period, there has been changes to the legal status of a business and the business has:

• Been issued a new single business identifier (SBI)
• Been merged
• Been split.

For example, Farmer A may have been operating as a sole trader in 2020, but then changed the business to a limited company in 2021, which meant it was issued with a new SBI.

In this case, the RPA will have sent out two information statements – one relating to the original SBI, which will only have reference data for 2020, and another relating to the new SBI, which covers 2021 and 2022.

Businesses must have made a BPS claim in 2023 to be eligible for delinked payments, so unless the farmer transfers the 2020 reference data to the new business, they will lose that value.

Similarly, where two or more businesses have been merged to form a partnership, reference data from the previous businesses can be transferred to the new partnership’s SBI.

This will probably not be an issue where a sole trader has become a partnership, as the SBI is likely to have remained the same.

However, it is important for farmers to check their own information carefully, as all business change circumstances are unique.

Farm sales and changes in tenancies

Transfers are also likely to be relevant in cases where a farm has been sold, there has been a change in tenant, or the farm was taken back in hand.

Julie Robinson, agriculture partner with law firm Roythornes, says an agreement on whether the reference history will be transferred to the new business is likely to have been built into sales contracts or leases.

However, there will be cases where people have been sent an information statement, but are not eligible for a delinked payment as they did not make a BPS claim in 2023, where there is no obligation in the contract to do so.

“That amount will be lost if they don’t transfer it to someone else. If there is a market for someone to transfer some or all of the reference amount, they should see if they can sell it.”

Farmers should also be aware that, except in cases where land is inherited, it is looking as though transfer requests can only be made this year.

New entrant issues

Julie says one difficulty is that new entrants who started farming after 15 May 2023 will not be entitled to receive a transfer, unless they inherited the land where special exemptions apply.

New entrants are also facing a double whammy, as the RPA system does not currently allow them to sign up to the Sustainable Farming Incentive (SFI) because they have no 2023 BPS claim history.

‘That’s been a bit of a shock, although I am told that this barrier should have gone by the time the 2024 SFI offer becomes available.”