Bickford -Smith, R (on the application of) v Secretary of State for Environment, Food and Rural Affairs

Under the Single Payment Scheme, payment entitlements are allocated on a once-and-for-all basis and are decoupled from later production levels. Initial allocation criteria must be distinguished from the rules governing subsequent operation of the scheme. Later use of common land cannot require redistribution of existing entitlements. Non-use of grazing rights may constitute agricultural activity where it contributes to maintaining land in good agricultural and environmental condition, including by avoiding over-grazing. Entitlements may be obtained through transfer, but allocation from the National Reserve is confined to the statutory categories. A farmer who begins a new form of agricultural activity does not thereby become a farmer who has commenced agricultural activity for the first time.

The claimant sought judicial review of the Rural Payments Agency’s Claim Statement dated 3 December 2012, which denied her Single Payment Scheme subsidy in respect of her New Forest common rights. She had no payment entitlements allocated in respect of those rights in 2005 because she had not grazed animals during the relevant reference period. Her existing entitlements were fully activated by her farmland claim.

She argued that entitlements should be redistributed by reference to current use of common rights, that other farmers’ entitlements should have reverted to the National Reserve through non-use, and that she should receive an allocation from that reserve. The central issues were whether the historic allocation rules could govern later operation of the scheme, whether non-exercise of grazing rights could amount to agricultural activity, and whether she fell within a National Reserve category.

1. The court refused permission for judicial review and dismissed the claim. The challenge to the 2005 allocation was not pursued. The issue was therefore whether the RPA had acted unlawfully in applying the established scheme to the claimant’s 2012 claim.

2. The initial allocation of payment entitlements under Regulation 1782/2003 was a once-and-for-all exercise. The claimant impermissibly elided the discretionary criteria used for that initial allocation with the mandatory rules governing later operation of the scheme. The legislation provided no mechanism for redistributing entitlements in later years by reference to changing use of the land or common rights. Redistribution on that basis would be unlawful.

3. The scheme decoupled subsidy payments from production. Agricultural activity included maintaining land in good agricultural and environmental condition. Non-exercise of common grazing rights could contribute to that condition by helping to avoid over-grazing. It was therefore lawful for the RPA to treat non-exercise as agricultural activity capable of activating notional entitlements.

4. Even if other farmers’ entitlements had reverted to the National Reserve under the two-year non-use rule, the claimant could not establish an entitlement to receive them. The National Reserve provisions permitted allocations only within defined categories. She was not a farmer commencing agricultural activity, because she had already been carrying on agricultural activity through her suckler herd since 1994. Beginning grazing on the New Forest common did not amount to becoming a farmer for the first time.

5. The claimant had usage hectares arising from her 2012 common rights, but no spare payment entitlements to activate with them. She could have acquired transferable entitlements on the market. There was no basis for a reference to the Court of Justice of the European Union.