Government bows to pressure and unveils new loan scheme

Farmers and crofters in less favoured areas to get share of £50m

The Scottish Government has announced a new £50 million loan scheme for farmers in less favoured areas.

Rural secretary Fergus Ewing bowed to growing pressure from the farmers’ union and admitted the current situation wasn’t good enough.

The stop-gap measures will be in place until EU loans are processed by the failed IT system later this year, and letters inviting the most marginal farmers to apply for funds will be issued before the end of the month.

The money will provide security to producers in the hills and uplands, but it doesn’t mask the spectacular failure of the Government’s expensive computer system.

Mr Ewing used a new phrase to describe the ongoing struggle to make £180m worth of technology do its job – “We continue to increase the functionality of the IT system,” he said.

The reaction of NFU Scotland (NFUS) was curt.

“This cash injection is much-needed and will be welcomed once people start receiving it into their bank accounts,” said union president Andrew McCornick.

“Despite NFUS calling for the loan as the quickest way to deliver vital support to farmers and crofters, it remains disappointing that the IT system continues to need to be bypassed.”

Mr Ewing also provided an update on progress to deliver the remaining 2016 farm payments.

The first 90% of basic/greening and young farmer payments are in bank accounts and the top-up 10% is promised by the end of June.

The Scottish Suckler Beef Support and Scottish Upland Sheep Scheme payments are scheduled for May, and rural priorities money will be paid from July.

Agri-environment climate scheme and forestry grants will be paid in autumn along with beef efficiency scheme funds and land managers options.

Mr Ewing said: “The schedule prioritises the payment of core direct support to reach the greatest number of farmers and crofters and I expect the vast majority of farmers and crofters will receive all their basic and greening payments by the end of June.

“I want to reassure all farmers and crofters that officials continue to work flat-out to a detailed plan to put 2016 payments on to a better footing.”

Mr Ewing’s assurances didn’t convince the Scottish Conservatives rural affairs spokesman, Peter Chapman.

He said the loan scheme was welcome but it raised serious questions about whether the farm payments IT system would ever work.

“Having spent all the cash, we end up with a system that does not work. It’s just a disaster,” added Mr Chapman.

Picture: PA. The new loans will help to provide some security to producers in the hills and uplands.