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Scottish farmers are to be offered loans this autumn in lieu of their anticipated Basic Payment Scheme monies, as part of a new CAP stabilisation plan announced by rural affairs secretary Fergus Ewing.

Applications for the loans should open in late September, with 90% of expected BPS and “greening” support delivered to eligible applicants from November.

This will be the third year in a row that loan schemes have had to be used because of the failure of the Scottish government’s IT system to deliver farm subsidies effectively and on time.

The November payments will be ahead of normal BPS payments, which would usually start to go out in December. The 10% balancing payment is expected next spring.

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Announcing the plan to the Scottish parliament, Mr Ewing acknowledged that his department had fallen short of expectations in the past.

“We are absolutely committed to ensuring CAP entitlements are paid promptly and in full.”

The CAP stabilisation plan therefore also provides a clear timetable for payments under all the various support schemes.

And it promises to “tackle the major causes of poor customer service, error and payment delay by investing in our business and IT systems”.

Clarification

As part of the comprehensive timetable, there was clarification that Less Favoured Area Support Scheme (LFASS) 2016 payments will start at the end of this month, while LFASS 2017 payments are expected in May 2018.

If delivery in May 2018 looks unachievable, a further loan scheme will be introduced by the Scottish government.

Welcoming the announcements, NFU Scotland president Andrew McCornick said: “Loan schemes have proved effective in tackling the many difficulties experienced in delivering CAP payments under the 2015 and 2016 schemes. 

“Knowing that 90% of your BPS and greening will be delivered in November, and having a timetable when other payments will be received, gives clarity and certainty to farming and crofting businesses. 

“Experience from previous loan schemes indicates that this announcement will have a positive effect on the whole rural economy.”