ON April 29 this year, the government through Defra started a consultation on the current review of the CAP (Common Agricultural Policy) usually referred to as the CAP health check.

Of those questions, two may be of particular interest to smallholders.

The first was whether the minimum size of land needed to be able to claim under the single payment scheme should be one, three or five hectares and the second was an option to introduce an objective test to determine who is eligible to claim these payments.

To understand the significance of these questions, look back to when the single payment scheme was introduced. The last major review of the CAP was in 2003 which resulted in the current scheme starting in 2005.

At that time, if you were exercising an agricultural activity and had land at your disposal for at least ten months you were eligible to claim entitlements, as long as you did so by May 16.

In practice what this meant was that you did not have to be a ‘farmer’ growing a crop or keeping animals to qualify. The entitlements were awarded to you and not the land although a minimum of 0.3 hectares of land maintained in good agricultural and environmental condition (GAEC) was needed for a claim.

When the consultation closed on July 22, the majority favoured setting the minimum area at one hectare. Some argued that the SPS could be an important source of income for smallholders and that smallholders would be unlikely to be able to obtain more land or entitlements to prevent their being excluded from the scheme.

The points were also made that smallholders should be supported to help reduce food miles and that they play an important role in maintaining landscapes and rural communities.

On the second question, the majority of respondents felt that an objective test of whether a person is a ‘farmer’ or not should not be introduced thus maintaining the status quo.The detailed results can be seen at www.defra.gov.uk.

As applications for entitlements closed in 2005, there are only two ways to obtain them if you are not already in the scheme.

One is to buy land with the seller also transferring their entitlements to you or to buy entitlements on the open market, you will still need land to be able to claim. As the scheme is about half way through and no-one knows what if anything will replace it, you may need to weigh up the potential income against the cost if you are thinking of either.

The cash value of entitlements will vary as when the scheme was set up some farmers because of previous subsidies had an ‘historical’ element added. This meant they were able to claim the full value of that year’s payment. New entrants to the scheme with no history of previous subsidies were only paid ten per cent of that year’s payment. As the years pass, the percentage paid to those new entrants increases on a sliding scale to the full 100 per cent at the end of the scheme period As a guide only, in 2008 such a new entrant in England might have received around £97 per hectare.