Proposals for an area-based system of determining Single Farm Payment in Scotland are being worked up by NFU Scotland.

Scotland has avoided the problems experienced by England by adopting a historical system based on farming activity in the three years 2000 – 2002.

It has enabled the Scottish Government to pay out SFP on time every year in December but the union recognises that continuing to determine payments on the basis of what happened 10 or more years ago is unsustainable. Payments to those no longer farming, who continue to be eligible for SFP, have also been heavily criticised.

There is a school of thought that the historical system should be retained linked to a more recent reference base but is unlikely to be accepted as a way forward by the EU Commission.

NFUS president, Jim McLaren, says any support system adopted from 2014 onwards must be linked to production and the favoured option is a system based on area payments scaled to land quality as determined by the well-established Macaulay land grading system.

It is envisaged that most support would be concentrated on medium quality land – grades 3 – 6 – with little support required for the best grade 1 land nor for grade 7 land which has little productive potential.

The union is alarmed that proposals for a flat-rate system across Europe is finding favour in Brussels which would be devastating for the UK – and Scotland in particular – because of the country’s diverse landscape and geographical conditions.

“A flat rate system is too blunt an instrument and might result in a payment as low as £87 a hectare over all agricultural land in Scotland,” said chief executive, James Withers.

SFP in Scotland currently ranges from 6p/ha to 4000 euros/ha and there are huge differences in the rest of Europe, ranging from 80 euros in Latvia to 500 euros in Greece.