Welsh Government admits disallowance discussions on EU payments scandal

Dinas Bran, Creigiau Eglwyseg

Plaid Cymru demands full RDP review as £53m may have to be paid back

An urgent and independent review of the Rural Development Programme is needed after it was revealed that millions of pounds may have to be paid back to the EU in the wake of mismanagement of funds by the Welsh Government.

That’s the view of Plaid Cymru’s shadow rural affairs minister Llyr Gruffydd, whose questions to the minister Lesley Griffiths in the Senedd’s Environment committee (1) revealed that the EU is looking at ‘disallowance’ of some or all of the £53 million of Rural Development Programme funding that a Wales Audit Office report recently found was awarded without competition.

The WAO report found that most of the awards made had not shown best value for money and this has sparked discussions with the EU to claw back funding.

Tim Render, director for agriculture and food in the Welsh Government, responded to Mr Gruffydd’s question about whether there was a risk of disallowance: 

“Yes, there is and we are in discussions now with the European Commission for potential level of penalties and some have been applied in previous years. So yes there is likely to be some disallowance in light of this. It’s an ongoing negotiation process.”

In response to further questioning from Mr Gruffydd about where that money would be paid from, Mr Render said it would be “managed within the overall budget – we’ve made some provision for and factored in.”

Mr Gruffydd later said: “Plaid Cymru has warned all along that RDP funding needed to go to the right places and that the Welsh Government needed to ensure best value for money at all times. The WAO report revealed at least £53m had been awarded without competition, which is hugely worrying and begs many questions about the way this Government is funding rural projects. 

The WAO report revealed at least £53m had been awarded without competition, which is hugely worrying and begs many questions about the way this Government is funding rural projects.

“Now it emerges that the EU is looking to reclaim some or all of that money because it’s been so badly managed. If millions have to be re-paid because of failings on the part of this Government, then it will mean money destined for Welsh rural communities could be lost forever. It’s a scandal and heads should roll.”

The clock is ticking

Mr Gruffydd said he also wanted a commitment from the minister that uncommitted funding of more than £50m from the RDP was being allocated correctly and that the Government is true to its word that at least 80% of the funding modulated across to rural development would find its way back to Welsh farmers.

He added: “The committee was told that at end of June the Government had formally committed £701m out of £834m programme – but of the £130mm left, about £80m has also been allocated to live schemes that are out for expressions of interest and being evaluated at the moment. That means there’s about £50m left that’s entirely uncommitted. The clock is ticking and unless it is properly committed in the coming months it will be lost.

“I’ll be seeking assurances from the Government that this money is used correctly and that we won’t see a repeat of this funding fiasco. Having taken this money away from farmers to fund schemes we need to see evidence that Ministers are keeping their word and using the funds to support the industry. 

“Only a full review of the RDP can give us confidence that the funds have been used effectively, delivering value for money and a decent return on investment for rural communities. This takes on even greater significance given the Welsh Government intends to replicate the RDP model in its proposals to reform rural support in the post-EU era.

There’s an urgent need to restore confidence. Farmers can be penalised for minor discrepancies in forms they must submit for payments. Yet the same department that penalises them is failing to do basic homework on how best to spend its budget.

“There’s an urgent need to restore confidence. Farmers can be penalised for minor discrepancies in forms they must submit for payments. Yet the same department that penalises them is failing to do basic homework on how best to spend its budget. We need an immediate review of the RDP and I want assurances that farming communities will not lose out due to this Government’s failures.”

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