This item was published during the term of a previous administration that ended in April 2007
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Less Favoured Areas Support Safeguarded For Next Few Years
02/08/2000
Releasing details of revised proposals for LFA support, which will be lodged with the European Commission, Ross Finnie announced today that agreement has been reached for a three year safety net, which will help safeguard the support that hill farmers and crofters in Scotland's Less Favoured Areas (LFAs) will receive over the next few years.
The Minister for Rural Affairs said:
"This safety net is excellent news. It will remove the uncertainty, which I know has been of real concern to many hill and upland farmers and crofters. I have pressed hard for sensible interim arrangements to avoid damaging otherwise sound farm businesses.
"I am pleased that Commissioner Fischler has listened to the strong case we put to him and responded positively to it. At a practical level it means that next year every farmer is guaranteed at least 90% of the LFA support received last year.
"Recognising the importance of this scheme to Scotland, I intend to keep the future funding levels under review in the light of the Whitehall Spending Review, which provides additional expenditure for Less Favoured Areas but on a declining trend after next year.
BACKGROUND
1. Historically farmers and crofters in Scotland's Less-Favoured Areas (LFAs) received compensatory allowances based on the number of eligible cattle and sheep. (Note: 85% of Scotland is classified as LFA).
2. Under the new Rural Development Regulations (EC Reg 1257/1999), LFA payments must now be made on an area, as opposed to a headage, basis. Recognising the impact of this change Member States were given a special dispensation last year (for payments made in the Spring of this year) to continue headage payments.
3. With the ending of that derogation, and recognising that substantial numbers of farmers would get considerably less support under an area-based payment régime, the Scottish Executive, other UK Departments and other member states (including Ireland), have looked hard for a safety net to operate to allow those who stand to lose out under this new arrangement to have their losses cushioned.
4. The Commission has now agreed to a three year safety net. Under new LFA arrangements - gained after intensive lobbying of the EU at political and official level - farmers and crofters will be guaranteed 90% of the difference between last year's payment and the level calculated for area-based Compensatory Allowances for the spring of 2001.
5. In 2002, they will be guaranteed at least 80% of their Year 2,000 payments .In spring 2003 the safety net will be set at 50%. There will be no safety net for the remainder of the Plan which runs to 2006.
6. The Scottish Executive hopes to further refine the area-based scheme, which is being submitted to Brussels shortly, so that future payments more accurately reflect sustainable farming in different parts of the country.
7. A copy of the Scottish Executive's Rural Development Plan will be made available once it has been finalised and forwarded to the European Commission.
News Release: SE2164/2000
2 Aug 2000