Annual Report and Accounts 2007

For a full copy of the NFU Scotland 2007 Annual Report click here, for a full copy of the NFU Scotland Financial Report 2007 click here or contact NFUS Head Office.  The following is the President's Report for 2007 and the Chief Executive's Report:

President's Report

With a new Presidential team elected at NFUS for 2007 and a new Government elected at Holyrood for the next four years, the challenges facing us for once, seemed to be more closely matched by the opportunities these new relationships could create.

Plans were thrown into chaos on August 3 however, with the announcement of an outbreak of Foot and Mouth Disease in Surrey. Suspicion quickly fell on the nearby Government controlled laboratory at Pirbright as the source of the outbreak, and much of the rest is history.

It is important to stress that on this occasion, unlike in 2001, the industry has carried an enormous burden on behalf of Government and the British taxpayer in the form of movement controls. These controls were undoubtedly justified at the outset and their swift implementation certainly avoided a repeat of the mass cull of 2001 which cost the Government around £3.5 billion in compensation to the industry.

On this occasion, Government has spent under £50 million on the same compensation for culling and carcass destruction. For the sake of a few hundred million nationally now, the UK government could compensate the industry for its invaluable part in controlling this disease and the enormous cost saving which that has generated for Government. Failure to act on this will seriously undermine the relationship between our industry and Government and put at risk the very partnership which is required to tackle outbreaks in the future.

Meanwhile, the Scottish Government has stepped in at our request and funded an initial welfare package for light lambs and a subsequent aid package for sheep producers in the form of a ewe headage payment. As I write this we continue to press for wider compensation package for the entire industry funded by UK Government. This is a twin track approach of both political pressure and legal action.

The threat of Bluetongue disease reaching Scotland next year is also concentrating the minds of the best in the business, as the race for a vaccine and the debate as to how it can best be utilised hots up.

So what else has been happening?

We have seen unprecedented rises in milk price as global markets ran short of commodity products and world prices soared. These price rises have been slow to feed through to Scottish producers but most have now seen rises of close to 50% on their price year on year. These rises appear to be sustainable in the medium term as increases in supply look unable to meet increases in global demand for the foreseeable future.

Huge rises in global cereal prices have also been experienced, as world population growth, increased affluence, pressure from droughts and floods due to climate change and the demand for crops for bio energy production have all conspired to create a perfect storm in these markets.

Many producers have seen prices more than double, although those tied into contracts have not seen the benefit immediately.

This increase has had a hugely detrimental effect on the livestock industry, already reeling from the effects of FMD, Bluetongue restrictions and lost export markets, with pigs & poultry sectors feeling the pain in particular.

I am very positive about the future of our industry in the medium to long term, but that future will be out of reach for many unless we see significant and immediate price increases at farm gate level.

In order to safeguard supplies for the future retailers and Governments need to act now.

Looking into next year we have the CAP Health check to contend with. This is a process in which NFUS has been thoroughly engaged at EU level, and we have had several meetings already both in Scotland and in Brussels. We have discussed in detail not only the health check but also the wider reform of the CAP post 2013.

Given all that I have outlined above, I am very confident in a bright future for Scottish agriculture. We need a strong NFUS at the heart of that future, and I am going to work tirelessly to urge all farmers to join the cause if they haven’t already done so.

Jim McLaren, President

Chief Executive's Report

It’s difficult to look back over the last twelve months without getting stuck on Foot & Mouth, Bluetongue, Avian Influenza and any other animal disease that may yet strike before we see out 2007. Indirectly or directly these disease outbreaks have blighted the businesses of many of our members, as well as dominating the working lives of both staff and office holders here at Ingliston.

But some good does come out of bad. The last few months have proved that, at least on animal health matters, we do have an excellent working relationship with the Scottish Government, at both Ministerial and official level. And we have shown ourselves able to provide reliable information quickly (and with a touch of much needed humour) to our members – I am immensely proud of the huge amount of effort that has gone into this by the whole team.

This business of influence is hugely important and was confirmed in a further telephone survey of our membership this summer. Expectations relate strongly to NFUS’s role in representing and fighting for the farming industry in Scotland and that we need to be visible in doing so. We certainly have been visible and effective through the Foot & Mouth and Bluetongue outbreaks, as well on a whole host of other issues, including the future of CAP, Nitrate Vulnerable Zones, Water Abstraction and supermarket power. On the last of these, many felt we were wasting our time trying to get the Competition Commission to take seriously our concerns about treatment of suppliers by the big multiples. But, not only did we secure an inquiry, the interim report has vindicated our position and recommended action to prevent abuses.

Ironically, further proof of our effectiveness came in a front page article about LFA payments in the Sunday Herald in November with the sensationalist headline “The £40m farm subsidy scandal”. The quotes I preferred were “the extraordinary influence that NFUS can exert on ministers and officials” and “the NFUS knew what it was talking about”!

We certainly raised our visibility and profile in June with the launch of our “What’s on Your Plate” campaign. We’ve had a huge amount of media coverage, many members have become involved in events and some 15,000 people have signed the pledge. All of us who have taken part have been hugely encouraged by the support for Scottish farming and local food amongst the population at large.

So, I firmly believe we enter 2008 in good heart. We recruited around 400 new members in 2007 and returned another healthy surplus despite considerable investment in improving our service to members. This investment will continue in 2008, as we move towards our target of having a Regional Manager in each of our nine regions, addressing one of the other conclusions of our survey, that our members need more contact with NFUS staff and office bearers. Please continue to support us in all that we are doing to ensure the continuation of a strong farming industry in Scotland.
 
Andy Robertson, Chief Executive

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