The CAP reforms agreed in June 2003 shifted the focus of support away from production based subsidy schemes to a Single Payment Scheme which encourages farmers to respond to market and consumer needs. Claimants of the Single Payment must comply (cross compliance) with environmental, food safety, animal and plant health and animal welfare standards.

Farmers apply for the Single Payment Scheme by completing a Single Application Form. This is submitted by 15th May each year, along with details of the land they use. Farmers can request payment in euros or sterling when they complete their form.

Entitlements are the basis for payments under the Single Payment Scheme. An entitlement is a right to a payment, provided it is supported by a hectare of eligible land.  Entitlements can be traded on the open market. UK entitlements have been allocated across the four countries of the UK. Entitlements allocated within one payment area can only be used and transferred within that payment area.

In order to receive payment, the farmer must

• be actively farming and/or maintaining the land in good agricultural and environmental condition
• have land at their disposal.
• retain and maintain up-to-date farm records (e.g. BCMS, Trading Standards, Animal Health)
• ensure that there are no breaches of the cross compliance and Good Agricultural and Environmental Condition (GAEC) requirements.

A financial ceiling has been set for each European Union Member State. Within the United Kingdom Wales, England, Scotland and Northern Ireland have their own regional ceilings, which are fixed until 2013. Discussion about the shape of the CAP after 2013 is already underway.