Big agri-rule bill for Scottish Executive
Big agri-rule bill for Scottish Executive
By Shelley Wright
Scotland correspondent
THE Scottish Executive faces a bill that could top £1m, after settling a two-year wrangle with farmers over its misinterpretation of agri-environment scheme rules.
Executive officials have agreed to pay money they withheld from 121 farmers who had agri-environment payments frozen when the executive reinterpreted the rules surrounding stock reduction components of the Environmentally Sensitive Area Scheme and the Countryside Premium Scheme.
Originally, government advice to Scotlands farmers was that although the quota covering sheep removed from the land could not be sold or leased, it could be used to make Sheep Annual Premium claims for other stock already on the farm, such as hoggs.
Then, last year, the 121 farmers received letters telling them that the executive lawyers had misinterpreted the rules and that quota could not be used at all. As a result, the executive froze both SAP and agri-environment payments to the farmers.
But, after months of discussion with the NFU Scotland and the EU Commission, the original ruling, allowing farmers to use the quota for other sheep on their own holdings, has been reinstated.
Jim Walker, president of NFU Scotland, said it was a victory for the 121 farmers directly involved. "For the first time, we have been able to get government to admit it was wrong, and to reimburse producers who were penalised through no fault of their own," he said.
The farmers will now receive the agri-environment payments worth about £450,000 that have been withheld from them, along with about the same total in back-payment on the SAP that was frozen.
But the Executives bill could run even higher, Mr Walker said. "This settlement could affect another 600 or so farmers who joined the Countryside Premium Scheme after the Executives 2000 ruling on freezing quota.
"These people could well have made management decisions based on the erroneous advice being given by the Executive at that time, and they could be due compensation if they had to change their systems to adapt to rules that have now been proved were incorrect.
"We will be considering this further and trust that the Scottish Executive will take measures to deal with this new situation," said Mr Walker.
Scotlands rural development minister, Ross Finnie, has always accepted that the executive had got it wrong in this case. He announced an interim payment of £1000 for each producer in February as compensation for the disruption. *