Credit crunch warning to Scottish farmers

Banks, tightening credit and a reducing budget were at the heart of an address by Scottish Rural Affairs Secretary Richard Lochhead to NFU Scotland’s annual meeting in Aviemore.

Mr Lochhead threw his audience a few scraps of comfort in the shape of benefits for new entrants to the industry but warned that no new money would be forthcoming in the near future, largely because the Scottish Government’s own devolved budget is due to be cut by £500 million a year in 2010-11.

The Cabinet Secretary insisted that farming was the one sector best placed to weather the recession and help lead the recovery but admitted that he was hearing growing reports of farmers being unable to access credit from the banks.

He added: “The message from the banks is that they are not making farmers lives difficult but I am very concerned, and I will be meeting bankers within the next few weeks.

And Mr Lochhead used the opportunity to make party political points, highlighting policy differences between Westminster and Holyrood, and claiming that he could do much more for Scottish agriculture if more powers were devolved.

“We have to lobby London on labelling, on fuel duty for remote areas and on a host of other issues including the appointment of a supermarket ombudsman,” he said.

“I have made my views clear that we need an ombudsman but the power doesn’t rest with the Scottish Government. My English counterpart Hilary Benn has failed to address the issue and I will continue to press him to take action in this vital area.”

On the electronic identification of sheep, Mr Lochhead said he shared farmers concerns and would leave no stone unturned in his quest to make implementation easier.

He said later that he recognised the strength of feeling which might make farmers take to the streets in demonstrations.

“Farmers are entitled to protest in any way they think fit,” he said.

Meanwhile, Scotland’s chief vet Charles Milne said he was delighted by farmers response to the compulsory vaccination programme for bluetongue in Scotland .

More than three million doses of vaccine have been dispensed, and in some parts of the country more than 50% of holdings have already completed their vaccination programme.

Figures vary from only 11% in the Western Isles where producers still anticipate a derogation, to 30% in the Highlands and Islands and 50% in the Borders and Dumfries and Galloway.

Mr Milne said that many sheep farmers were waiting until lambing time to bring in sheep flocks in case of any risk of abortion.

He said : “Plans are afoot for many of these farmers to vaccinate in March and April and we believe we are on track for an excellent uptake.”

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