20 july 2011

The National Audit Office (NAO) has revealed that Defra and the Rural Payments Agency (RPA) are still wasting taxpayers' money. After the NAO qualified the departments’ 2010/11 accounts, Amyas Morse, the Comptroller and Auditor General said the administration of the single payments scheme had resulted in a "significant loss to the taxpayer."

Defra’s accounts were qualified on the grounds of regularity, because of penalties totalling £175 million from the European Commission. The RPA was audited due to its failure to make an accurate assessment of the value of overpayments and underpayments which have been made to farmers since the Single Payment Scheme began.

Defra was found to have incorrectly applied regulations in the processing of EU schemes, including the Rural Development Programme. The NAO concluded that the disallowance penalties Defra incurred were a direct result of weaknesses in the management and administration of the Rural Payments Agency, particularly for the early years of the Single Payment Scheme.

National Audit Office head Amyas Morse commented, "Yet again I have qualified the accounts of the Department for Environment, Food and Rural Affairs because of material disallowance penalties following incorrect payments to farmers.

"There continues to be a significant loss to the taxpayer because of weaknesses in the administration of the Single Payment Scheme by the Rural Payments Agency. I welcome the appointment of a new senior leadership team at the Agency which should now urgently address the issues which have led to my qualifications."

However, although it revealed problems persist at the RPA, the office did acknowledge that there had been some improvements in the Agency’s core financial controls since its new leadership team took over.