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Targeting Key to CAP Success in Scotland

Precious Pillar 1 support must be preserved for activity

NFU Scotland is adamant that the precious funding available through Scotland’s future Pillar 1 regime must be focussed on activity driven support.

In its submission to the Scottish Government’s consultation on future CAP direct payments in Scotland from 2015, NFUS states that its overarching aim is to correct as far as possible the injustices of the current historic system while ensuring the new area-based system targets support as efficiently as possible.

The submission recognises that direct support funding will be limited - effectively cut by up to 20 per cent through decisions taken by the EU, the UK Government and the Scottish Government.  Therefore, while setting out with the ambition of driving as good a deal for all recipients, protecting Scottish agriculture or sheltering any sector or farm type from a support shortfall will be very difficult.

The Union believes extreme changes, however, can be avoided if the right decisions on Pillar 1 implementation are taken by the Scottish Government. Together with a complementary Pillar 2 (rural development) package, the direct support made available must enable all active farms and crofts- whether a new, developing or established business - to prepare for the challenges ahead.

Commenting on the key points in NFU Scotland’s 38-page submission, President Nigel Miller said:

“There is an urgent need for a new level of ambition from the Scottish Government for our food and farming sectors.  That requires the strength to take tough decisions if the legacy of the current CAP reform is to be positive for the Scottish rural economy.    

“The Union’s response to the Government's CAP consultation runs to more than 270 clauses but its main thrust is to target support to activity and close down slipper farming.

“Scotland must use whatever means are at its disposal to ensure that precious, limited support is used solely to underpin activity and the retention of those farms and crofts delivering for the economy, the environment and rural communities.

“While those funds are limited, the new Pillar 1 set up in Scotland must be driven by an intention to deliver for all sectors and all regions, and must address the needs of new entrants, crofters and established farm businesses.  

“What is unescapable is that this is a tough reform for Scotland but the Union has aimed, in its response, to build as robust a support platform for all sectors and regions as we can.

“Cuts to the direct payment budget mean arable land will see support fall by close to 27 per cent based on the Scottish Government’s preferred regionalisation option. Redistribution of support will also cut deeply into other sectors. A more sophisticated approach is required in the rough grazing region (RGR) perhaps dividing it in two and utilising the enhanced coupled envelope.

“On timescales, the Union is also  determined that new entrants and those developing their business gain full area support from 2015 and that the reform also provides a managed transition for established businesses, intensive businesses, farms forced to consolidate through loss of short term lets and those disadvantaged by mapping anomalies.

“There are no simple solutions but what is clear is that to deliver for Scotland’s food and farming sector, direct support delivery to farmers and crofters must work in tandem with the new rural development package.

“For Scotland, with key decisions still to be made in the run up to August this year, the 2015 implementation timetable looks challenging. The Union is looking to the Scottish Government to work with Europe to ensure that interim payments are allowable if there are delays in finalising direct payments as we move into the new area based system. Farm cash flows must be maintained even if there are implementation problems.”  

Notes to Editors

NFU Scotland has responded to the Scottish Government consultation: ‘Implementation of CAP Reform (Pillar 1) in Scotland.  In summary, the Union’s key points are:

  • Scotland must use whatever means at its disposal to ensure that support continues to underpin activity and the retention of active farms and crofts that can then deliver for the economy, the environment and rural communities.
  • The new Pillar 1 set up in Scotland must be driven by an intention to deliver for all sectors and all regions, and must address the needs of new entrants, crofters and established farm businesses.
  • Payment regions - NFU Scotland has always believed that efficient targeting will use limited funds more effectively, and so more regions would mean less flattening of payments.
  • Payment rates - NFU Scotland firmly believes that outcomes should be prioritised over arbitrary budget splits.  The choice of the right delivery mechanisms to target support on activity, while seeking parity with the rest of the UK, will drive appropriate budget allocations.
  • Transition - NFU Scotland sees transition decisions being critical for three distinct groups - active new entrants, slipper (inactive or underactive) farmers, and established active agricultural businesses.  In particular, NFU Scotland sees real merit in exploring the possible use of tunnel options to help key sectors through what will be a turbulent period of adjustment.
  • Minimum threshold - NFU Scotland supports keeping the minimum threshold as it is at three hectares. 
  • Active farming - NFU Scotland remains adamant that the mandatory ‘Scottish clause’ must be enabled to work effectively.  NFU Scotland considers that the activity rules should be based on appropriate grazing that reflects the carrying capacity of the land, or on undertaking significant active efforts every year to maintain agricultural land in good condition. 
  • Reduction coefficients - NFU Scotland supports the Scottish Government’s proposal not to use either of the reduction coefficients available, provided activity requirements are sufficiently robust.
  • Degressivity and capping - NFU Scotland believes that Scotland should do no more than the regulations require, but also include the option to offset against salaries.
  • Windfall tax - NFU Scotland supports the Scottish Government’s proposals to use the windfall tax provisions.
  • Siphon on sales of entitlements - NFU Scotland thinks that Scotland should take full advantage of a siphon on sales of entitlements without land.
  • Mandatory greening - NFU Scotland is firmly of the view that if Scotland’s farmers meet greening requirements or qualify for exemptions under the three greening rules, then Scottish agriculture is delivering against its greening obligations – as agreed by Europe.  NFU Scotland is adamant that the greening rules must not be ‘gold plated’ in Scotland. 
  • Cross-compliance - NFU Scotland supports much of the Scottish Government’s intentions on new good agricultural and environmental conditions (GAEC) requirements, but also rejects some.
  • Coupled support – beef sector - NFU Scotland supports the use of eight per cent coupled support being dedicated to the maintenance of beef production.  However, NFU Scotland also believes that this coupled support can be more effective in underpinning beef production through an alternative approach to that proposed by the Scottish Government. 
  • Coupled Support – RGR Payment Region - NFU Scotland is adamant that any additional coupled funding must be used to move Scotland away from a single, flat rate Basic Payment across all of the highly variable RGR payment region.
  • Optional Redistribution Payments - If an effective tunnel transition option is not delivered, then NFU Scotland sees merit in the possible use of the Redistributive Payments option as an alternative.
  • Mandatory Young Farmers’ Scheme - At this stage, NFU Scotland supports the Scottish Government’s proposal to pay Young Farmer top-ups on the first 54 hectares using Option 1.
  • Optional Small Farmers’ Scheme - NFU Scotland considers that the overall costs outweigh the potential benefits, and so does not support the use of this option.
  • Optional Pillar 1 Support for Areas with Natural Constraints - NFU Scotland considers that the overall costs outweigh the potential benefits, and so does not support the use of this option unless other mechanisms employed by the Scottish Government significantly fail to address the extremes of redistribution from the shift to area-based payments for some very specific locations.
  • Mandatory National Reserve - NFU Scotland considers that new entrants should be able apply to have entitlements topped up to the regional average from the National Reserve, and agrees that the National Reserve be used to help existing new entrants from Day One.  The National Reserve should be continuous and it should accommodates those that are its intended targets.  

A copy of NFU Scotland’s full submission to the Scottish Government is available on request from media@nfus.org.uk

Ends

Contact Bob Carruth on 0131 472 4006

Date Published:

News Article No.: 62/14


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