Agriculture Bill (HC Bill 7)

Part 1 Financial assistance

CHAPTER 1 New financial assistance powers

1 Secretary of State’s powers to give financial assistance

(1) 5The Secretary of State may give financial assistance for or in connection with any one
or more of the following purposes—

(a) managing land or water in a way that protects or improves the environment;

(b) supporting public access to and enjoyment of the countryside, farmland or
woodland and better understanding of the environment;

(c) 10managing land or water in a way that maintains, restores or enhances cultural
or natural heritage;

(d) managing land, water or livestock in a way that mitigates or adapts to climate
change;

(e) managing land or water in a way that prevents, reduces or protects from
15environmental hazards;

(f) protecting or improving the health or welfare of livestock;

(g) conserving native livestock, native equines or genetic resources relating to any
such animal;

(h) protecting or improving the health of plants;

(i) 20conserving plants grown or used in carrying on an agricultural, horticultural
or forestry activity, their wild relatives or genetic resources relating to any
such plant;

(j) protecting or improving the quality of soil.

(2) The Secretary of State may also give financial assistance for or in connection with
25either or both of the following purposes—

(a) starting, or improving the productivity of, an agricultural, horticultural or
forestry activity;

(b) supporting ancillary activities carried on, or to be carried on, by or for a
producer.

(3) 30Financial assistance may only be given in relation to England.

(4) In framing any financial assistance scheme, the Secretary of State must have
regard to the need to encourage the production of food by producers in
England and its production by them in an environmentally sustainable way.

(5) For the purposes of this section—

• 35“ancillary activities” means selling, marketing, preparing, packaging,
  processing or distributing products deriving from an agricultural,
  horticultural or forestry activity;

Agriculture BillPage 3

• “better understanding of the environment” includes better understanding
  of agroecology;

• “conserving” includes restoring or enhancing—

  (a)

  a population of a relevant species;

  (b)

  5in the case of animals or plants in the wild, a habitat;

• “cultural or natural heritage” includes uplands and other landscapes;

• “improving productivity”, in relation to carrying on an activity,
  includes—

  (a)

  improving the quality of any products deriving from the
  10activity, and

  (b)

  improving the efficiency of the activity in terms of the resources
  used in, or in connection with, it;

• “livestock” includes any creature kept for the production of food, drink,
  oils, fibres or leathers, or for the purpose of its use in the farming of
  15land;

• “producer” means a person who carries on, or is to carry on, an
  agricultural, horticultural or forestry activity.

(6) In this Chapter—

• “financial assistance” means financial assistance under this section;

• 20“financial assistance scheme” means a scheme for giving financial
  assistance.

2 Financial assistance: forms, conditions, delegation and publication of
information

(1) Financial assistance may be given by way of grant, loan or guarantee or in any
25other form.

(2) Financial assistance may be given subject to such conditions as the Secretary of
State considers appropriate.

(3) The conditions may (among other things) include provision under which the
financial assistance is to be repaid or otherwise made good (with or without
30interest).

(4) Financial assistance may be given to a person in connection with a third party
scheme made or operated by that person.

(5) In subsection (4) “third party scheme” means a scheme for giving financial
support for any one or more of the purposes in section 1(1) and (2) which is not
35made or operated on behalf of the Secretary of State.

(6) The Secretary of State may delegate functions relating to the giving of financial
assistance to any other person.

(7) Functions delegated under subsection (6) may include—

(a) the giving of guidance;

(b) 40the exercise of a discretion.

(8) The Secretary of State may by regulations make provision for or in connection
with requiring the Secretary of State or another person to publish specified
information about financial assistance which has been given.

(9) Information which may be specified includes information about—

(a) 45the recipient of the financial assistance;

(b) the amount of the financial assistance;

(c) the purpose for which the financial assistance was given.

(10) Regulations under subsection (8) are subject to affirmative resolution
procedure.

(11) 5In this section “specified” means specified by regulations under subsection (8).

3 Financial assistance: checking, enforcing and monitoring

(1) The Secretary of State may by regulations make provision for or in connection
with—

(a) checking whether eligibility criteria for receipt of financial assistance
10are met and the consequences, where financial assistance has already
been given, if not;

(b) enforcing compliance with conditions subject to which financial
assistance is given;

(c) monitoring the extent to which the purpose of financial assistance has
15been achieved;

(d) the investigation of suspected offences in connection with applications
for, or receipt of, financial assistance.

(2) Regulations under subsection (1) may (among other things) include
provision—

(a) 20about the provision of information;

(b) conferring powers of entry;

(c) conferring powers of inspection, search and seizure;

(d) about the process for determining if eligibility criteria, or conditions
subject to which financial assistance is given, are met;

(e) 25about the keeping of records;

(f) about the recovery or making good of all or any part of financial
assistance which has been given (with or without interest) or the
withholding of all or any part of financial assistance;

(g) imposing monetary penalties (including penalties calculated by
30reference to the amount of financial assistance);

(h) prohibiting a person from receiving financial assistance, or financial
assistance of a specified description, for a specified period or until
specified conditions are satisfied;

(i) about appeals;

(j) 35conferring functions (including functions involving the exercise of a
discretion) on a person.

(3) Regulations under this section may not authorise entry to a private dwelling
without a warrant issued by a justice of the peace.

(4) The provision which may be made under subsection (2)(f) includes provision
40for interest on any recoverable amount to be payable from such day (whether
the day on which the financial assistance in question was given or a later day)
as may be provided for in, or determined under, the regulations.

(5) Regulations under this section are subject to affirmative resolution procedure.

(6) In this section “specified” means specified by, or determined under,
45regulations under subsection (1).

4 Multi-annual financial assistance plans

(1) The Secretary of State must from time to time prepare a document (a “multi-
annual financial assistance plan”) giving information about the expected use of
the powers conferred on the Secretary of State by section 1 during the period
5to which the plan relates (the “plan period”).

(2) A multi-annual financial assistance plan must (as a minimum)—

(a) specify the plan period,

(b) set out the Government’s strategic priorities for giving financial
assistance during the plan period, and

(c) 10describe, in such manner and giving such detail as the Secretary of State
considers appropriate, each financial assistance scheme that—

(i) is in operation, or

(ii) the Secretary of State expects to come into operation during the
plan period.

(3) 15The plan period for the first plan is the period of seven years beginning with 1
January 2021.

(4) The plan period for a subsequent plan may not be shorter than five years.

(5) The Secretary of State must ensure that the plan period for a plan does not
expire without a new plan being in place for a plan period beginning the day
20after the last day of the expiring plan period.

(6) A plan prepared under this section must be laid before Parliament, and
published, by the Secretary of State before the beginning of the plan period.

(7) Where, before the end of the plan period for a plan—

(a) the Government’s strategic priorities for giving financial assistance
25change, or

(b) it appears to the Secretary of State that any information given in the
plan by virtue of subsection (2)(c) has ceased to be accurate and
complete,

the Secretary of State must amend the plan accordingly as soon as it is
30practicable to do so.

(8) A document setting out amendments being made to a plan must be laid before
Parliament, and published, by the Secretary of State, as soon as practicable
after being prepared.

(9) The Secretary of State must have regard to the strategic priorities set out in the
35plan by virtue of subsection (2)(b) when determining—

(a) what financial assistance to give;

(b) the overall budget for, or for any period of operation of, a financial
assistance scheme.

(10) In this section “the Government” refers to Her Majesty’s Government in the
40United Kingdom.

5 Annual and other reports on amount of financial assistance given

(1) For each financial year the Secretary of State must prepare a report (“the annual
report”) about the financial assistance given during the year.

(2) The first year to which subsection (1) applies is financial year 2021-22.

(3) The annual report must include the following information—

(a) the total amount of financial assistance given;

(b) the total amount of financial assistance given under the financial
assistance schemes in operation during the year (taken together);

(c) 5the required information about each financial assistance scheme in
operation during the year (see subsection (4));

and the report may include any other information the Secretary of State
considers appropriate.

(4) The required information about a financial assistance scheme is—

(a) 10the total amount of financial assistance given under the scheme, and

(b) the extent to which that assistance met any obligation or commitment
under the terms of the scheme as to the timing and amounts of financial
assistance to be given during the year.

(5) For the purposes of subsections (3) and (4), information about amounts of
15financial assistance given otherwise than by way of grant may be included in
the report in such manner as the Secretary of State considers most appropriate.

(6) The Secretary of State may also prepare—

(a) interim reports about the amount of financial assistance given during
any period within a financial year;

(b) 20other reports about the amount of financial assistance that has been
given.

(7) The Secretary of State must, after preparing a report under this section—

(a) lay a copy of the report before Parliament, and

(b) publish the report.

(8) 25In the case of an annual report, the Secretary of State must comply with
subsection (7) before 1 October in the financial year following the year to which
the report relates.

6 Monitoring impact of financial assistance etc

(1) The Secretary of State must, in relation to each financial assistance scheme—

(a) 30monitor the impact of the scheme, and

(b) make one or more reports on the impact and effectiveness of the
scheme (having had regard to the findings of that monitoring).

(2) The Secretary of State may, in relation to any financial assistance given
otherwise than under a financial assistance scheme—

(a) 35monitor the impact of the financial assistance, and

(b) make one or more reports on the impact and effectiveness of the
financial assistance (having had regard to the findings of that
monitoring).

(3) Monitoring under subsection (1) or (2) must be carried out in such manner and
40for such period or periods as the Secretary of State considers appropriate for
the scheme or other financial assistance in question.

(4) The number and frequency of reports made under subsection (1) or (2) are to
be as the Secretary of State considers appropriate for the scheme or other
financial assistance in question.

(5) Every such report must be laid before Parliament, and published, by the
Secretary of State.

CHAPTER 2 Direct payments after EU exit

7 Meaning of “basic payment scheme” and other expressions in Chapter 2

(1) 5This section defines or explains expressions used in this Chapter.

(2) The “basic payment scheme” is the Basic Payment Scheme under the Direct
Payments Regulation (see Title III of that Regulation), as it operates in relation
to England, including the arrangements relating to each of the following
elements of direct payments under that scheme—

(a) 10so much of a direct payment that does not consist of a greening or
young farmers payment (see Chapter 1 of Title III),

(b) a greening payment (see Chapter 3 of Title III), and

(c) a young farmers payment (see article 50 of that Regulation).

(3) The “legislation governing the basic payment scheme” is—

(a) 15the following retained direct EU legislation—

(i) the Direct Payments Regulation;

(ii) any Council Delegated Regulation, or Commission Delegated
Regulation, made under the Direct Payments Regulation;

(iii) any other retained direct EU legislation which relates to the
20operation of the basic payment scheme, and

(b) any subordinate legislation relating to retained direct EU legislation
falling within paragraph (a).

(4) The “agricultural transition period for England” is the period for the time being
specified in section 8(1).

(5) 25References to a direct payment under the basic payment scheme are to any
payment under that scheme, whether or not including a greening payment, a
young farmers payment or both elements.

(6) “Delinked payment” has the meaning given by section 12(2)(a).

(7) “Relevant payment” means—

(a) 30a direct payment under the basic payment scheme, or

(b) a delinked payment.

(8) The “Direct Payments Regulation” is Regulation (EU) No 1307/2013 of the
European Parliament and of the Council of 17 December 2013 establishing
rules for direct payments to farmers under support schemes within the
35framework of the common agricultural policy.

8 The agricultural transition period for England and the termination of relevant
payments

(1) The agricultural transition period for England is the period of seven years
starting with 2021.

(2) After the end of that period no relevant payments are to be made in relation to
England, otherwise than in respect of the last year of that period (or an earlier
year).

(3) The Secretary of State may by regulations amend subsection (1) for the purpose
5of extending the period specified there.

(4) That power—

(a) may be exercised more than once;

(b) may not be exercised if the agricultural transition period for England
has already ended.

(5) 10Regulations under subsection (3) are subject to affirmative resolution
procedure.

9 Power to modify legislation governing the basic payment scheme

(1) The Secretary of State may by regulations modify legislation governing the
basic payment scheme, so far as it operates in relation to England, for or in
15connection with making changes the Secretary of State considers would serve
any one or more of the following purposes—

(a) simplifying the administration of the scheme or otherwise making its
operation more efficient or effective;

(b) removing provisions which are spent or of no practical utility;

(c) 20removing or reducing burdens, or the overall burdens, on persons
applying for, or entitled to, direct payments under the scheme or
otherwise improving the way that the scheme operates in relation to
them;

(d) securing that any sanction or penalty imposed under the scheme is
25appropriate and proportionate;

(e) limiting the application of the scheme to land in England only.

(2) The provision which may be made under subsection (1) includes provision
made for or in connection with terminating greening payments in relation to
England before the end of the agricultural transition period for England so
30long as that provision does not reduce the amount of a direct payment to which
a person would have been entitled had the provision not been made.

(3) In this section, “burden” includes—

(a) a financial cost;

(b) an administrative inconvenience;

(c) 35an obstacle to efficiency, productivity or profitability.

(4) Regulations under this section are subject to negative resolution procedure
(unless section 47(5) applies).

10 Power to provide for the continuation of the basic payment scheme beyond
2020

(1) 40The Secretary of State may by regulations modify legislation governing the basic
payment scheme to make provision for or in connection with securing that the basic
payment scheme continues to operate in relation to England for one or more years
beyond 2020 until payments cease by virtue of section 8(2) or 12(7)(a).

(2) The power conferred by subsection (1) includes power to provide for the direct
payments ceiling for England for any relevant year to be determined, in a
specified manner, by the Secretary of State.

(3) Provision made by virtue of subsection (2)—

(a) 5must require a determination in respect of a relevant year to be
published as soon as practicable after it has been made, and

(b) may confer functions on any person in connection with, or with the
making of, a determination in respect of a relevant year.

(4) In this section—

• 10“the direct payments ceiling for England” is the national ceiling of the
  kind referred to in Article 6 of the Direct Payments Regulation that is
  applicable in relation to England for any relevant year;

• “relevant year” means a year within the agricultural transition period for
  England in respect of which direct payments under the basic payment
  15scheme fall to be made in relation to England;

• “specified” means specified in regulations under this section.

(5) Nothing in this section affects any power under this Chapter or any other
enactment to amend or revoke provisions of the legislation governing the basic
payment scheme for any year or years beyond 2020.

(6) 20Regulations under this section are subject to affirmative resolution procedure.

11 Power to provide for phasing out direct payments

(1) The Secretary of State may by regulations make provision for or in connection
with phasing out direct payments under the basic payment scheme in relation
to England over the agricultural transition period for England.

(2) 25See section 12(7) for circumstances in which subsection (1) (with any
regulations made under it) may cease to have effect before the end of that
period by virtue of provision for delinked payments having been made.

(3) In subsection (1) “phasing out”, means taking steps to secure that, on one or
more occasions before the end of the agricultural transition period for England,
30there are reductions in the amounts paid out to some or all of those entitled to
receive direct payments under the basic payments scheme.

(4) If provision for terminating greening payments is made under section 9(2)
(whether before or after the start of the agricultural transition period for
England) subsection (1) above has effect as if the reference to direct payments
35does not include (or no longer includes) the greening payment element of
direct payments.

(5) Regulations under this section are subject to affirmative resolution procedure.

12 Power to make delinked payments

(1) The Secretary of State may by regulations make provision for or in connection with the
40making of delinked payments in relation to England (in place of direct payments under
the basic payment scheme in relation to England).

(2) For this purpose—

(a) a delinked payment is a payment, with respect to a year within the
delinking period, which is made in accordance with the regulations to
a person who is under the regulations entitled to receive it, and

(b) the delinking period is the period which—

(i) 5begins with a year (other than 2021) that is specified in the
regulations, and

(ii) ends on the last day of the agricultural transition period for
England.

(3) Regulations under this section making provision for the making of delinked
10payments must—

(a) specify the descriptions of persons who, in respect of a year within the
delinking period, are entitled to receive a delinked payment (whether
or not they are required by the regulations to make an application or do
anything else before anything becomes payable), and

(b) 15make provision setting out rules for determining the amount of the
delinked payment to be made to an entitled person with respect to any
year.

(4) Regulations under this section may make provision—

(a) for a person who makes a request in accordance with the regulations to
20cease to be regarded as a person entitled to receive delinked payments,

(b) for other circumstances in which a person ceases to be entitled to
receive such payments, and

(c) for the repayment (with or without interest) of any amount paid as a
delinked payment to which the recipient was not entitled.

(5) 25A description of persons specified under subsection (3)(a) may (but need not)
be framed by reference to whether they were entitled to a direct payment
under the basic payment scheme in respect of a specific year (or one of several
specific years) prior to the first year of the delinking period.

(6) Rules set out under subsection (3)(b) for determining the amount of any
30delinked payment to be made to a person may (but need not) be framed by
reference to the amount of a direct payment to which the person was entitled,
or if specific assumptions are made would have been entitled, under the basic
payment scheme.

(7) If provision for the making of delinked payments is made under this section—

(a) 35no direct payments under the basic payment scheme in relation to
England are to be made otherwise than in respect of the last year before
the delinking period (or an earlier year), and

(b) section 11(1) (with any regulations made under it) ceases to have effect
at the end of that last year, except in relation to direct payments in
40respect of that last year (or an earlier year).

(8) Regulations under this section are subject to affirmative resolution procedure.

13 Power to provide for lump sum payments in lieu of relevant payments

(1) The Secretary of State may by regulations make provision for or in connection
with the payment of lump sums to eligible persons.

(2) 45For this purpose an eligible person is a person who—

(a) applies for payment of a lump sum under the regulations,