Hundreds of small holders are "off the hook" because of a Government decision not to cut their income under the Single Payment Scheme.

People with small-holdings, known as "pony paddock" claimants, thought they might be facing a battle with the Government if the size of their field fell beneath a raised threshold in the Common Agricultural Policy.

Alex Fair, a legal executive in the agricultural and rural affairs department at Stratford-upon-Avon law firm Lodders, says the current 0.74 acres (one hectare) minimum threshold for SPS will remain fixed following a Common Agricultural Policy Health Check.

"This will come as a great relief to many people in the county who either grow their own crops or keep a limited number of livestock and fowl - often not for profit. They will see themselves as off the hook," she said.

Around £1.5 billion is paid out annually under the scheme by the Rural Payments Agency, part of the Department of the Environment, Food and Rural Affairs.

The SPS was introduced in England in 2005 following the 2003 CAP reforms.

'Pony paddock' claimants receive the payment for keeping their land in good agricultural and environmental condition.

The Tenant Farmers Association wanted the threshold raised to 12.35 acres. It claimed that in four years there were 40,000 applicants for payment - many unrelated to farming - resulting in administration problems, including delays in SPS payment from the Rural Payments Agency to genuine farmers. 

DEFRA sought views on what the new cut-off level should be.  The Country Land and Business Association (CLA) and the National Farmers Union supported the lower threshold of one hectare.  

The CLA said 17,000 claimants nationally could have lost out if the higher threshold had been introduced with 333,450 acres being taken out of cross-compliance.

Alex Fair said: "The small-holders must keep their land in good agricultural and environmental condition to satisfy the eligibility criteria currently in place. 

"However, the TFA did have a case in arguing that mean payments would be made more efficiently if the RPA had fewer of them to deal with." 

In addition to the minimum size of holdings there was also consultation on the definition of a "farmer."

Many people involved in the sector thought that those who owned paddocks only should not be included in the definition - and should not be eligible for the SPS subsidy payment.  The definition was not amended.