Producer organisations' payments wrangle could take two more months to resolve

Growers could be waiting another two months before the Rural Payments Agency (RPA) lifts the suspension on producer organisations' payments -- making it difficult for them to plan for the new season.

This is because the RPA has announced that it aims to complete its review of all producer organisations by 31 March — a time limit that the NFU said has angered many people.

NFU chief horticultural adviser Phil Hudson told Grower: "It's a matter of great concern that this process is taking much longer that it should."

Sarah Pettitt, chairman of the NFU's board for horticulture and potatoes, added: "We understand that this ruling by the EU was not of the RPA's making, but how the RPA deals with the situation is important and producer organisations and growers are still not clear where they stand some three months later. It's simply not acceptable that producer organisations now planning for the coming season should be left in the dark like this.

"We hope the RPA will work rapidly to assess producer organisations and, where they pass muster, remove the suspension of payments so that the organisations and their growers can get back to the business of producing and supplying fresh produce."

Keven Brooks, a financial controller at Fruitlink, a Wisbech-based producer organisation for top fruit growers, said: "We are used to waiting for the RPA, but there's this element of uncertainty now. We are having to subsidise our growers' producer organisation account at the moment to stop it from being overdrawn."

Fortunately, some producer organisations were given a cash injection before Christmas when the agency released some £4.5m of overdue three-quarterly payments that should have been paid by the end of last September, but got caught up in the suspension.

All payments were suspended to the UK's 50 or so producer organisations in October 2009, so that Defra could determine a new policy on shared facilities. This followed a Court of First Instance judgement given to the French authorities, who lost their appeal against a multi-million-euro fine for failing to comply with the shared facilities rules.

It is claimed, for example, that producer organisations have been formed to obtain funds to buy specific items that are then not shared with other producer organisation members.

The RPA has now drawn up a new policy on shared facilities but is still in the process of assessing individual producer organisation's compliance of the new rules.

It told Grower: "The revised policy clarifies that producer organisations must own the necessary facilities or have responsibility for the provision of them. The policy allows that these may be provided through producer organisation members, but producer organisations must be able to demonstrate that they control and are responsible for any facility provided this way. To help producer organisations, the RPA has introduced the option of mutual user agreements or similar contractual agreements."

Meanwhile, the RPA has lifted the payment suspension on a handful of producer organisations that could "demonstrate full compliance with the revised policy".

For the remaining organisations, the RPA told Grower it was "continuing to assess information supplied and, where necessary, seeking further clarification and documentation with the aim of completing the review by 31 March."

It added: "As soon as we determine individual organisation compliance with the revised policy, suspension of aid payments will be lifted and any outstanding claims for that producer organisation addressed."

Any queries should be emailed to fruit& with "producer organisations facilities — query" in the subject field.



Further panic was caused last week when the RPA sent out letters to around half of the country's producer organisations informing them that they will be subject to an intensive inspection.

No date was given as to when the inspection will be taking place. The NFU's Phil Hudson told Grower those producer organisations that have not received a letter were now worried that "no news is bad news". He added: "They have put two and two together and made five."

But the RPA told Grower: "No conclusions should be drawn from the RPA's inspection visits. It is simply part of the process whereby we are assessing producer organisations' compliance with the new criteria. Not all producer organisations will need to be inspected."


Subscribe to Horticulture Week for more news, more in-depth features and more technical and market info.

Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Sign up now
Already registered?
Sign in

Before commenting please read our rules for commenting on articles.

If you see a comment you find offensive, you can flag it as inappropriate. In the top right-hand corner of an individual comment, you will see 'flag as inappropriate'. Clicking this prompts us to review the comment. For further information see our rules for commenting on articles.

comments powered by Disqus

Read These Next

How will reduced apple and pear harvests hit the industry?

How will reduced apple and pear harvests hit the industry?

This spring, many top-fruit growers in the UK and across Europe were dismayed to discover that swathes of their orchards had been hit by frost.

How should fruit growers prepare for water abstraction reform?

How should fruit growers prepare for water abstraction reform?

Upcoming reforms to water abstraction licensing will for the first time cap the amount of water that fruit growers can take for trickle irrigation.

Getting a measure of the production labour crisis

Getting a measure of the production labour crisis

At a debate during last week's Fruit Focus trade show in Kent, senior industry figures painted a bleak picture of an increasingly difficult seasonal labour market that is already impacting on investment.