When farm subsidies become a lottery

What happened

Mr H claimed European Union farming subsidies under the Single Payment Scheme (SPS) run by the Rural Payments Agency (RPA). Its electronic data errors meant it paid him almost £15,000 for 2005 and 2006 – over 10 times what it should have paid him. Mr H accepted the figures RPA sent him and treated the payments as correct.

RPA discovered its mistake in 2007 and told Mr H about this in 2008. It started taking the money out of his annual subsidy payments. He complained, insisting the payments had been correct.

In 2010, data errors led RPA to decide it had underpaid Mr H. It made him a payment of over £20,000 in subsidy. But this was another mistake. Mr H, now over 70 years old, is still repaying the money to RPA.

What we found

We partly upheld this complaint. RPA's data errors led to it overpaying the subsidy. It took too long to identify the first overpayments and the correct payment position. It sent incorrect information to Mr H about his subsidy claim, based on its incorrect data. It mishandled the decisions to recover the overpayments. It lacked a debt recovery approach that adequately balanced its conflicting duties to the European Commission and to its customers. Its approach to remedy when it considered Mr H's complaint was wrong.

Without RPA's mistakes, there would have been no overpayments. Mr H would have had accurate information instead of a series of apparent pay–outs that were in fact unsolicited loans. He would have had properly made decisions about his queries that gave him the information he needed to challenge them. He would have avoided, at an age when he wanted to retire, the prolonged stress and trouble of dealing with and seeking to challenge RPA's decisions. But when Mr H received the 2010 overpayment, he should have been more suspicious that RPA had made another mistake. That would have lessened the trouble he went through.

Putting it right

RPA apologised to Mr H and made him a consolatory payment of £750 for the inconvenience and frustration caused. It reviewed its decision about whether or not the SPS 2005 and SPS 2006 overpayments were recoverable, taking note of our finding about the flaws in its earlier decision. It concluded that it was correct to recover the overpayments. RPA also agreed to produce guidance for claimants and staff on the recovery of overpayments that, fairly, sets out the responsibilities of RPA and of claimants.