Commentary on provisions of Act Section 5: Power to increase direct payments ceilings for 2020
Section 5 amends the retained Direct Payments Regulation to allow the Secretary of State, having regard to the Bew Review, to decide to increase the UK national and net Direct Payments ceilings for 2020. It also amends regulation-making powers that already exist in the Direct Payments Regulation (in Articles 6(3) and 7(3)) so as to widen their scope to enable the 2020 national and net ceilings to be increased to take account of this decision. This means that where, as a consequence of the Government’s decision following the Bew Review, the amount of direct payments goes above the limit set by the national and net ceilings for 2020, these powers can be used to increase those ceilings to ensure they are not breached and payments can be made within the legislative framework.
	Subsection (1) introduces the amendments to the Direct Payments Regulation.
	Subsection (2) amends Article 6(3) of the Direct Payments Regulation so that the regulations made under the powers provided to the Secretary of State in that paragraph to adapt the 2020 national ceiling can take into account the decision made in accordance with the new Article 7A, explained below. The national ceiling comprises, for the UK, the total value of all allocated payment entitlements, of all national reserves and regional reserves and of all the financial ceilings calculated with respect to the individual direct payment schemes. Regulations made according to decisions relating to the 2020 national ceiling will require the consent of all devolved administrations.
	Subsection (3) amends Article 7(3) of the Direct Payments Regulation so that the regulations made under the powers provided to the Secretary of State in that paragraph to adapt the 2020 net ceiling can take into account the decision made in accordance with the new Article 7A, explained below. The net ceiling delimits the value of Direct Payments which can be made in the UK for the 2020 claim year. Regulations made according to decisions relating to the 2020 net ceiling will require the consent of all devolved administrations.
	Subsection (4) inserts Article 7A into the retained Direct Payments Regulation. This article provides the Secretary of State with the power, having regard to the Bew Review, to decide to increase the total maximum amount of direct payments that could otherwise be granted in relation for the claim year 2020. Subsection (1) of the new article provides the power. Subsection (2) specifies what the Bew Review is.
	Subsection (5) of Section 5 amends paragraph 5 of Article 22 of the Direct Payments Regulation, so that any increase in national or net ceilings as a result of the exercise of the powers in new Article 7A will result in a corresponding increase in the value of payment entitlements.