Welcome commitment to LFASS funding

NFU Scotland has expressed disappointment at Scottish Government proposals to transfer 9.5 percent of Scotland’s direct support funds to rural development funding.

While European rules would allow up to 15 percent of the Pillar 1 (direct support) pot to be transferred to Pillar 2 (rural development), NFU Scotland believes a figure of 7.5 percent – roughly equivalent to current modulation rates – to be more appropriate.

The Scottish Government announcement also included a commitment to protect vital rural development support for farmers, including Less Favoured Area support (LFASS).   That has been welcomed by NFUS given the importance of this scheme to many vulnerable livestock keepers across Scotland.

NFU Scotland will be responding to the Scottish Government consultation on the issue ahead of the deadline of 16 December, 2013.

Commenting on the announcement, NFU Scotland President Nigel Miller said:

“This announcement follows a disappointing budget settlement for our direct support funds and any further cuts to Pillar 1 support will be very challenging for Scottish farming businesses.

“We will use this consultation phase to impress upon the Scottish Government that retaining as much of our precious Pillar 1 budget for active producers across all land types will deliver on our rural development goals, be they economic, environmental or social.  Shifting significant funds to Pillar 2 and potentially holing our Pillar 1 budget below the waterline risks further undermining our vulnerable farming sectors.

“Our members will view the proposed modulation rate of 9.5 percent as too high and are unlikely to accept any transfer between pillars that is higher than the existing voluntary modulation rate.  

“We will be urging Scottish Government to adopt a transfer rate closer to 7.5 percent and make use of the option to review the rate in 2017.  We maintain that if the Scottish Government has to transfer money away from direct payments towards rural development, it should be in line with current modulation levels and only increased in 2017 if the Scottish Government can demonstrate that additional funds are required to support projects of real value under the new SRDP.

“We maintain that it is better to target direct support payments at active farm businesses across Scotland to enable them to continue to underpin all facets of rural development - prosperous local economies, flourishing environments, and thriving rural communities.  The pivotal role that farming plays will be under threat if too much direct support is withdrawn too soon.

“Within the announcement, we welcome the Cabinet Secretary’s commitment to maintain essential support of £65.5 million per year for LFASS.  That announcement alone will come as very welcome news to the majority of Scotland’s farmers and crofters.”  

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Contact Bob Carruth on 0131 472 4006