Interim report on future of support in Scotland

An inquiry team looking into the future of agriculture support in Scotland has published a ‘wish list’ of measures which it wants farmers to debate.

A radical new vehicle for delivering support to farmers who produce what society wants has been proposed as part of the list of measures the Scottish government may argue for in Brussels during the CAP reform negotiations.

The Pack Inquiry, which was set up last year by the Scottish Government, proposes in a 59 page Interim Report published this week that direct payments should continue as part of a four-strand approach to farm support in Scotland.

The other measures would include Less Favoured Area (LFA) support, rural development programme funding and a new Top Up Fund (TUF) financed directly by money from the direct payment budget.

Yet despite criticising the current historic based Single Farm Payment system as unjustifiable, the Inquiry firmly rejects any step change to a new system until at least a year after the post-2013 CAP regime is known.

It warns against falling into the trap of the RPA in England which rushed through change with serious consequences for the farming industry.

The report, presided over by Brian Pack, the recently retired chief of the ANM auctioneering group, suggests that to be effective a new TUF, which might support measures like fuel efficiency, stable beef production, renewable energy, animal health schemes and improved fertiliser usage, would need to be worth about 50% of the amount paid out as a direct area payment.

Speaking at a press briefing Mr Pack said: “Much more consultation and research is needed but the idea is that a TUF would be a fund to back outcome and transformational change.

“It could be the new contract between producers and Scottish society and give the Scottish public the sort of efficient and sustainable agriculture they want to see.”

In the short term the report suggests the use of Article 68 to address the reduction in breeding cows and ewes and includes a coupled cow subsidy for up to 40 breeding cows on LFA.

It also suggests an extension of the beef calf scheme and eradication of Bovine Viral Diarrhoea as possible measures for the beef industry together with a lamb headage payment to reverse the loss of ewes in the north-west of Scotland.

NFU Scotland president Jim McLaren said the report would stimulate discussion and welcomed the model of an area based payment with top up fund which he said fitted with the union’s own recommendations to the Inquiry.

But he warned that using Article 68 could be divisive and would affect struggling sectors which would be the funders rather than the beneficiaries under such proposals.

But this Interim Report which has cost £100,000 to date is just the beginning of a major evidence gathering and consultation process, with 12 meetings scheduled for every area of the country and a questionnaire on the government website.

Mr Pack described the findings as an “Aunt Sally” to be criticised and knocked around by all those interested in the future of Scottish agriculture.

The final Pack Inquiry report will be produced in June for the Scottish government which will then decide whether or not to follow the recommendations.

The “wish list” for the new post-2013 world will then be put to Member States and negotiated in Brussels.

KEY FINDINGS

* Future agricultural support should consist of direct payments, a top-up fund, rural development programme funding and Less Favoured Areas support

* There should be no change to the current Single Farm Payment system until at least a year after the post-2013 CAP regime is known

* There will be major losers and winners in a change to area-based payments, with intensive livestock producers in the losing category. Some 14% more agricultural land in Scotland would be included in a new area based scheme

* No methods exist to provide new entrants with entitlements under the CAP Health Check regulations

* The only way to counter the reduction in breeding cows and ewes is the use of Article 68. These could apply for the 2011 scheme year with first payments to applicants made in Spring 2012