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DRAFT RURAL DEVELOPMENT REGULATION
ANALYSIS OF RESPONSES TO CONSULTATION

CHAPTER 4 - RESPONSES TO AXIS 1, COMPETITIVENESS (articles 19-33)

For Axis 1 the Commission proposed that the restructuring strategy would be based on measures relating to human and physical capital and to quality aspects. The draft regulation included a meeting standards measure to promote a more rapid implementation by farmers of demanding standards based on new Community legislation. The measures proposed under Axis 1 were;

The questions posed in the consultation were all concerned the axis approach and were;

• Is the approach and allocation of measures to strategic axes relevant and appropriate?

• Are the proposals for redefining LFAs appropriate?

• What parameters should we consider for a future LFA Support Scheme?

• Does the proposed scope of forestry measures and the increased integration with measures to support agriculture and rural development meet the needs of Scotland's forestry sector?

Stakeholders were generally in favour of the proposed measures, making comments such as "we strongly support all the measures proposed under Axis 1" (Cairngorms National Park Authority) and "the measures available under Axis 1…….are vital in assisting farmers to adapt their businesses in the wake of CAP Reform" (National Farmers Union Scotland). Scottish Natural Heritage did not agree that the word 'competitiveness' was the most appropriate to describe the axis, believing that there were 2 distinct types of competitiveness, one relating to agricultural production (which most farmers would recognise) and also in terms of environment. Despite this, SNH felt that many of the measures making up the axis would help stimulate land-based economic activity in rural areas.

Improving Human Potential

Looking at comments made on the individual measures, starting with improving human potential, most organisations supported Articles 21 and 22 (young farmers and early retirement) with three of them (Scottish Rural Property and Business Association, Cairngorms National Park Authority and Highland Council) arguing that they should be coupled, as implementing one without the other would not result in the desired outcome. It was felt that the measures offered a real opportunity to redress the problems of an ageing workforce. NFUS did however express concern that the scope and flexibility had in fact been reduced from that offered under the current measure.

Restructuring Physical Potential

There were varied comments in regard to this measure. SNH saw this as the most problematic from an environmental point of view. They expressed a desire to see a contribution to the cost of new technology for the purpose of reducing environmental impacts, citing their own TIBRE project as an example. Aberdeenshire Council felt that budget limitations and national priorities may influence the inclusion of this measure, but still felt it to be worthy of consideration. NFUS did not wish to see the scope of Article 25 (modernisation of farms) restricted to meeting standards. They were not convinced that our existing schemes aimed at modernisation, (eg Farm Business Development Scheme) were fully covered by Axis 3. They felt that the reduction in the period of grace was unnecessary. Crofters Commission, Highland Council and Highland Perthshire Communities Partnership were in agreement that emphasis should be on local processing and marketing to allow locally sourced quality produce to be available locally. In addition training needed to be accessible locally and appear relevant to farmers.

Improve Quality of Agricultural Production and Products

Both SNH and Aberdeenshire Council were strongly in favour of this measure, feeling that it offered scope for environmentally sustainable development while remaining fully relevant in improving competitiveness. Article 29 (meeting standards) was cautiously welcomed by NFUS, but Article 30 (participation in food quality schemes) was more contentious. Cairngorms National Park Authority felt that support should be made available for farmers and crofters participating in regional as well as national food quality schemes while NFUS argued that the restriction to products intended only for human consumption contradicted the more general aim of supporting energy crops. The Article was also criticised by Quality Meat Scotland who believed it should be widened to allow support for quality food products, not just related to food quality schemes. Advocates for Animals were of the opinion that while the existing regulation stipulated that, in order to be eligible for support, certain criteria regarding food quality had to be met, these did not appear in the proposed new regulation. The British Horse Society argued that any measures including horses or ponies must maintain standards minimum standards of equine welfare, and ought to be approved by a professional organisation.

Transitional Measures

There was little comment on this measure. Highland Perthshire Communities Partnership believed that transitional payments to less effective farms should be seen as important . SNH felt that Article 33 (setting up producer groups) should show preference to small local groups while Article 32 (semi-subsistence farming) was intended to apply only to the new Member States. NFUS took Article 33 also to refer only to new Member States, and argued that this should not be the case.

General

On more general topics Scottish Agricultural Association Society argued that co-operatives had a major role to play in helping to deliver sustainable rural development, and should form an explicit part of any rural development programme. The Council for Scottish Archaeology and Scottish Borders Council felt a need for more emphasis on support for the marketing and processing of agricultural products and farm diversification. There was wide support, from Argyll and Bute Council, Midlothian Council and COSLA for capacity building initiatives to help support more marginal businesses.

Opposite View

While most of the above comments were, in general, supportive, Quality Meat Scotland took the view that "the measures in Axis 1 are neither relevant nor appropriate to the aim of helping to improve the competitiveness of the agriculture industry." They backed this up by saying that while grants were available to help fund capital investment the outlay required by the farmer to attract reasonable amounts of support was too onerous. They felt that in general the flexibility of measures and funds available compared unfavourably with the measures in Axis 11. In addition they said that payment rates should be increased.

This dissatisfaction was echoed by the Scottish Association of Meat Wholesalers who expressed concern that the Axis 1 measures did not adequately address the competitiveness issues. They argued that support for better efficiency through the use of improved genetics, improved animal health and for quality food production should be more clearly addressed at more appropriate funding levels.

SNH also added a caveat that, given the Commission's narrow view of competitiveness and the kind of measures proposed, it may be advisable to make all support payments under Axis 1 time limited.

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