A new set of entitlements will be allocated to farmers under the Basic Payment Scheme if they apply for such by submitting a Basic Payment Scheme application in 2015 and meet the conditions for eligibility.

Main Features of the Basic Payment Scheme

The Basic Payment Scheme will operate in much the same way as the current Single Payment Scheme;

Similarities

  • An application will be submitted each year in which the farmer declares all of his land specifying

    which hectares are eligible for payment.

  • To draw down payment, a farmer must declare one eligible hectare for each entitlement that he

    holds.

  • All entitlements are subject to a ‘two-year usage’ rule. Any entitlement that remains unused for

    two consecutive years will revert to the National Reserve.

  • Entitlements are not attached to land but are allocated to a person and become the property of

    that person.

  • From 2016 onwards, entitlements may be transferred either with or without land.

  • Direct payments (including Basic Payment, Greening, etc) will not issue to a farmer where the total cumulative amount due in a given scheme year is less than €100.00

    • Differences

    However there are also significant differences between the current Single Payment Scheme and the Basic

    Payment Scheme;

  • Entitlements will be subject to convergence which will either increase or decrease their value from year to year. (Entitlements that have an Initial Unit Value between 90% and 100% of the Basic

    Payment Scheme national average will remain unchanged). Unlike the Single Payment Scheme

    therefore, the value of entitlements does not remain static but will change from year to year.

  • The maximum payment that will be granted to any one farmer under the Basic Payment Scheme in any one scheme year is capped at €150,000.00. (This does not impact on payment received under greening).

  • There is no option to consolidate (stack) entitlements under the Basic Payment Scheme. However the process of allocating entitlements (based on the lesser of hectares declared in 2013 and 2015) in 2015 spreads a farmer’s value across the eligible hectares on which entitlements are allocated. A farmer who is allocated a lower number of Basic Payment Scheme entitlements than he previously held SPS entitlements will effectively have his value consolidated onto his new set of

    Basic Payment Scheme entitlements.)

  • There is no ‘rotation’ of entitlements whereby entitlements that were unused in one year would

    be given priority usage in the following year. In effect this means that if a farmer fails to use 100%

    of his/her entitlements in at least one year of a two year period, the unused entitlements will

    revert to the National Reserve.

  • In addition to all standard transfers, entitlements may now be transferred by way of lease without land with effect from 2016.

    • Reference Points

    The current Single Payment Scheme is based on ‘production’ during the ‘reference period’ of 2000-2002. There is no such ‘production reference period’ under the new scheme. However the new scheme does make use of ‘reference points’ for three distinct purposes;

  • 1. 2013: Establishing an Allocation Right:

    To be eligible for the automatic allocation of entitlements under the new scheme, a farmer must

    have been eligible to receive a direct payment under the 2013 scheme year.

  • 2. 2013/2015: Calculation of Number of Entitlements

    The number of entitlements that will be allocated to a farmer in 2015 under the new Basic

    Payment Scheme will be based on the number of eligible hectares the farmer declares in either

    2013 or 2015, whichever is less.

  • 3. 2014: Calculation of Entitlement Value

    The total value of entitlements owned (held or leased out) by a farmer under the Single Payment

    Scheme in 2014 and where relevant the value of payment received under the Grassland Sheep

    Scheme forms the basis for calculating the value of his entitlements in 2015 under the Basic

    Payment Scheme. A percentage of each farmer’s 2014 value is carried forward and is used to

    calculate the ‘Initial Unit Value’ for each farmer in 2015.

    As the Basic Payment Scheme ceiling represents only a percentage of the 2014 value that will be

    carried forward, only a percentage of a farmer’s 2014 value of entitlements and the same

    percentage of Grassland Sheep Scheme payment where applicable is carried forward when

    calculating the value of his entitlements in 2015.

    • The following chart illustrates the relationship between these three reference points. The fundamental requirement is that a farmer holds an ‘allocation right’ (No. 1 above). A farmer who holds a ‘value’ (No. 3 above) and/or a ‘land reference’ (No. 2 above) but does not hold an ‘allocation right’ is not eligible to receive an allocation of entitlements under the Basic Payment Scheme in 2015. For this reason, persons who do not hold an allocation right are advised against buying entitlements in 2014. While such entitlements could be used under the 2014 scheme year, they would not carry forward to the new scheme in 2015 but would simply expire.

    Each of these three reference points is explained in detail in the following sections.