Scottish LFA delays put hill farms and crofts on the line, according to NFU Scotland

Scotland’s 13,000 hill farmers and crofters are facing a cash-flow crisis as a result of delays until the end of 2007 to LFA payments worth £61m, NFU Scotland warned this week.

The timetable for securing approval for next year’s rural development payments is “miles off schedule” as a result of major administrative delays in Brussels in agreeing the mechanism for national voluntary modulation.

NFUS chief executive Andy Robertson placed the blame for the immense financial strain payment delays would exert on thousands of farmers squarely at the door of Nos 10 and 11 Downing Street, as the UK is the only member state pursuing voluntary modulation.

Substantial delays

“Everyone acknowledges how important LFAs are and substantial delays are inevitable. This is not a situation we can live with and I wouldn’t have thought any government would want to go into an election with a big question mark over a payment seen as a barometer of its commitment to farming,” said Mr Robertson.

A large percentage of LFA recipients are tenant farmers without property assets who would not find it easy to increase borrowing if they run into cash-flow problems next year as a result of delays to the payment usually made in the spring.

The NFUS has presented SEERAD with two main options to deflect the looming crisis.

The first is for it to submit a more limited Rural Development Plan to Brussels, without voluntary modulation. “That would allow us to get a plan approved in time to release LFA payments,” said Mr Robertson.

The other alternative is the state aid option which would require SEERAD, which finances £48m of the £61m LFA payment total, to find £13m of additional funds.

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