asked Her Majesty’s Government:

How many outstanding single farm payments are still to be made for 2005; and what proportion are for full or part payment.

My Lords, the figure outstanding on 14 December was a total of 1,734 claims. Of those, 480 claims were for full payment and 1,254 had received a part payment and are awaiting a top-up. Once again, on behalf of the Government, I apologise for the delay in making these payments.

My Lords, I thank the Minister for his reply. I hope he brings a bit of Christmas cheer to the people who have been awaiting their payment since 2005. By comparison, under the devolved Administration in Scotland, 70 per cent of farmers will receive their 2006 payment by Christmas this year. I am aware that the devolved Administrations have a different payment scheme; however, in Germany, which has a similar system to England’s, farmers expect a full payment by the end of December this year. If Germany can do it, why can’t we?

My Lords, David Miliband made a Statement about next year’s payments on 7 November in the other place, and I repeated it here. The Statement was about how we would operate for 2006. We are actively working on it daily with the Rural Payments Agency and its staff, and we want to make a success of it so that the system is better in 2006 than in 2005. I am not prepared to go beyond that Statement at present.

My Lords, what is the average value of the payments outstanding? By average, it would be helpful if he could give the mode rather than the mean.

My Lords, I would like to. Of the 480 claims for which a full payment is due—in other words, for which nothing has been paid—the top 10 in terms of monetary value all relate to probate cases. I cannot go beyond that. That is no different from what would have happened under the old IACS payment system. The claims are incredibly complicated, but I cannot give a monetary value. The top-up claims would constitute approximately 20 per cent of the total claim, it being 80 per cent of the initial payment.

My Lords, is the noble Lord aware that I received a small payment a few months ago and that this weekend, much to my surprise, I received a further small payment? Should I send it back, or can I expect another payment?

My Lords, it could be that the noble Baroness has had her full payment. Whereas 480 claimants were awaiting full payment on 14 December, a week before, on 6 December, the figure was 911. Similarly, the number awaiting top-up claims on 6 December was double the figure I gave for 14 December. The payments are going out. We want to complete the 2005 payments as soon as possible, but because of the complexities of claims, particularly involving business relationships and probate, it will take some time, as was the case under the previous system.

My Lords, the Government have made a great deal of progress, and the situation is much better this year than it was last year. Is the Minister reviewing the damage done to claimants who have put in for higher- and entry-level stewardship? Defra officials have been taken off front-line duty assessing whether farmers can get into higher- or entry-level stewardship in order to process such claims. That is unfortunate, as many of them will be dependent on those claims in the future.

My Lord, the noble Lord is right. We have had to prioritise staff, time and resources. The single payment was crucial. Of course, there is another consequence: the hill farmer allowance has also been delayed, although few now remain to be paid. Our priority has been to complete the single payments. There is a complication, although we do not want it to be so. We need to close down the 2005 year as quickly as we can because that has delayed the start of the 2006 payments. We do not want a crossover. That has been an overall priority. We need to do better next year than we did this year. If we did not prioritise resources the situation would not be very good, but I accept that it has had a consequence on other schemes.

My Lords, declaring an interest as a client of the Minister’s department and an enthusiastic supporter of his efforts to sort out the situation, I alert him to the fact that various complications have emerged relating to environmental cross-compliance. His officials appear to be seeking to introduce more complications to sort out these difficulties, of which I will give him details outside the Chamber, rather than taking a simplification approach.

My Lords, we want to simplify and not to over-regulate, but we have to operate the regulations. There have been failures on cross-compliance, when inspectors have been out to farms to check the cross-compliance rules. In one case they were flatly refused entry to the farm. The situation was crazy. The farmer said, “You can’t do it”. We cannot accept that. However, if the noble Lord has specific problems or difficulties that he wants to draw to my attention, I have no doubt that he will.

My Lords, how many farming businesses have gone bankrupt as a result of this government fiasco?

My Lords, it would be impossible to work that out. The cash flow in the farming industry is partly affected by single payments, but it is affected by a lot of other issues. We have paid out £1.519 billion. We paid out the claims within 1 per cent of the legal limit by 30 June. We were required to pay out 96.15 per cent of the money; we have paid out around 94.9 per cent. Everybody knew that the window was from 1 December to 30 June. I agree that farmers were promised the money earlier, and we failed on that. However, we met our legal obligations, and we are paying interest on the claims not met by 30 June.