The Scotsman

Future may see fewer subsidies warns report

- By BRIAN HENDERSON

Scotland’s hills and upland areas could see farm payments maintained postbrexit, while the more adaptable arable areas could see support confined to low level environmen­tal payments if funding for the sector was squeezed.

While the SNP has been largely viewed as profarming, the real test for the administra­tion will be in coming years when it will be faced with balancing spending on agricultur­e with that required for health and education, stated the farm consultanc­y firm, Andersons, in their Outlook 2017 publicatio­n.

The report said that Scotland’s devolved government had taken an increasing­ly divergent route on both agricultur­al policy and land reform issues from that taken by the administra­tions in England and Wales – and indicated that the post Brexit future, for a Scotland either outside the EU or outside the UK, could see this trend go further.

Looking to a Scottish Agricultur­al Policy post Brexit, authors of the Scottish section, Ben Kellagher and Alex Caraffi, said that this could be based around a continuing regionalba­sed payment system, which rewarded producers in the better areas for undertakin­g environmen­tally focused activities – but

0 Arable farmers could face falling subsidies post-brexit at a much lower level than at present.

“These areas are seen as being the most capable at adapting to change,” stated the report, which went on to look at the less favoured areas.

“The uplands, hills and islands could well see a payment system based on a regional payment – discounted or inflated depending on individual business stocking rates – or perhaps a small regional payment with a significan­t top-up based on headage payments.

“The result of this,” said the authors, “would be to focus support to the more remote and less flexible areas and would possibly allow the Scottish Government to get by with less funding.”

They said that such an approach would lead to fairly swift changes in both the number and structure of lowground businesses – while upland and hill systems would see relatively smaller or slower change.

However the report also highlighte­d the fact that the less favoured area support scheme (LFASS) was due for reform in 2017:

“And while there has been little discussion of this at present, the conversati­on will be challengin­g, particular­ly given many upland businesses’ reliance on this for payment for profits.”

Kellagher and Caraffi also pointed out that the one of the biggest events for the SNP government over the past year had been the debacle surroundin­g the payments of farm support to farmers – and the cash-flow problems this had caused for many rural businesses.

However they stated that, should the party not hold power in the near future, farm support could become very different – indicating that the opposition parties did not have anywhere near the same empathy for rural areas.

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