The report published by the European Court of Auditors (ECA) on the application of the Single Payment Scheme (SPS) found that this mechanism contributes to the achievement of the two of the main objectives of the common agricultural policy, which are supporting farmers’ income and to maintaining agricultural land in good agricultural and environmental condition (GAEC). However, the report also found that the implementation of the scheme resulted in a number of questionable features, such as cases where the system encouraged investments by operators who have little interest in farming as an activity but who exploit the guaranteed returns that SPS provides.

The report focuses on the beneficiaries of the policy, the conditions of access to the scheme and the definition of eligible land. It also examined to what extent the scheme contributes to the objectives of supporting farmers’ income and to maintaining agricultural land in good agricultural and environmental condition (GAEC). Although the report confirms that in general terms the scheme accomplishes the CAP main objectives, also resulted in a number of questionable features. Among them, ECA found that the definition of the beneficiaries of the scheme was formulated, and subsequently applied, in a way that permits persons or entities not engaged in agricultural activity, or only marginally so, to benefit from Single Payment Scheme (SPS) payment.

In addition, in some member states the installation of new farmers is often hampered by present conditions of access to payments entitlements (which may entail substantial investments); another questionable feature is that the specifications of land eligible for EU aid as well as of eligible agricultural activity are loosely defined. As a consequence, farmers may receive payments without having to carry out any maintenance activity and there is no direct link between the level of the SPS aid and the costs incurred in maintaining land in good agricultural and environmental condition.

On the other hand, currently there are some twenty different variants of the SPS applied across the EU. Under the main variant (the historical model), aid is calculated on the basis of what farmers received in the years 2000-2002. Over time, payments have become divorced from current farming conditions in the different regions. Furthermore, the SPS primarily benefits few but large beneficiaries.

Bearing in mind these conclusions, the ECA has made a number of recommendations for the Commission to consider, including directing aid to “active” farmers; taking into consideration the cost of activities that positively contribute to the preservation or improvement of the environment; and also that the value of the entitlements be based on current farming conditions in the various regions of the EU and that a more balanced distribution of SPS aid between farmers be sought.