Payment delay continues for farmers and crofters

Thousands of Scottish hill farmers and crofters continue to wait for almost £10 million in funding as IT delays in delivering the final tranche of payments due under the Less Favoured Areas Support Scheme drag on.

Scotland’s LFASS scheme delivers lifeline support to 11,500 of the country’s most vulnerable and remote producers, recognising the economic, social and environmental benefits delivered by active farmers and crofters in these areas.

In March, when faced with the prospect of LFASS payments being significantly delayed due to the flawed IT delivery system, and under pressure from NFUS, Scottish Government put in place a national fund to ensure £55 million – from a total budget of £65 million – reached claimants. Payments under the national LFASS scheme bypassed the IT system, and were based on payments made under LFASS in 2014. It saw most claimants receive around 90 percent of funds due with a balance payment promised by Scottish Government later in the year. That further tranche of funding has yet to arrive.

In a further blow for hill sheep farmers, Scottish Government has failed to take on any of the recommendations made by NFUS on how the new Scottish Upland Sheep Support Scheme (SUSSS) could be improved to ensure this £6 million pot is better targeted at those most reliant on these payments. SUSSS aims to assist active hill farmers and crofters though a payment coupled to the number of ewe hoggs they keep. The 2016 scheme opened on 1 September and closes on 16 October.

NFUS believes Scottish Government has missed an opportunity to introduce a wider application period; a new retention period and to place an upper limit on the number of hoggs that can be claimed based on the size of the claimant’s flock.

NFU Scotland’s LFA committee chairman Martin Kennedy, who farms in Highland Perthshire said: “For those farming in Scotland’s Less Favoured Areas, there remains a £10 million hole in funding that would traditionally have been filled in March. While Scottish Government’s intervention in the spring, by-passing the flawed IT system, saw a welcome injection of £55 million via the old LFASS data, the balance of £10 million remains outstanding with no timetable for delivery.”

“For many of those same claimants, SUSSS is hugely important having been specifically designed to assist those keeping hill sheep in some of Scotland’s most extensive and remote parts. Like all new schemes, it has its flaws but it is a disappointment that Scottish Government, despite ample warning, has not addressed these in time for the new scheme year opening. NFU Scotland was not seeking to amend the budget or payment rate components. We simply wanted to make it more effective and better aligned to the interests of the hill farmers and crofters it is intended to support.”

“Scottish Government estimated that the payment rate in year one would be €100 per ewe hogg. The reality is that the payment rate was €78. And having failed to make any changes, there is an urgent need for Scottish Government to provide claimants with a new estimate of where next year’s rate is likely to be. We believed an upper claim limit based on a percentage of the breeding flock was required to help control over-claiming by those with an excess of ewe hoggs over and above the numbers they would normally require as flock replacements. By not adopting this measure, Scottish Government has increased the likelihood that rates will be further reduced for 2016 as some individuals may see it as an opportunity to exploit the scheme. That happened this year and it must not be allowed to happen again.”

“This scheme was a way of ensuring that Scotland’s limited CAP budget was spent wisely and targeted at the active. This is a scheme that has the potential to work extremely well but only if Scottish Government is willing to learn from experience and make the changes that are necessary.”

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