Douglas Miller has his sights trained on grouse profits

THE pattern of hill farming for almost 50 years was set by the right of producers to receive headage payments on the number of cattle and sheep run on each unit.

In theory, stocking limits might be imposed by civil servants, but the reality was that the more livestock carried on a farm, the greater the subsidy.

That all changed with the reforms of the Common Agricultural Policy in 2003 and the implementation of those new policies on 1 January 2005. The numbers game has been banished to the history books and farmers must devise new regimes. The result to date has been a considerable reduction in the breeding sheep flock on many farms and a slightly less marked fall in the number of suckler cows.

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Game shooting has been a lifelong passion for Robbie Douglas Miller, former managing director of the Jenners department store in Edinburgh, and when the chance came to buy the 3,000-acre estate of Horseupcleugh in the Lammermuir Hills, near Duns, in late 2005 he did not hesitate, believing this was a rare opportunity to develop a commercially viable grouse moor.

Douglas Miller explains: "With a steady decline in farm incomes over many years it was clear to me that we had to change things and that other income streams were required to square the books. But diversification of any form involves a considerable capital investment. The sheep were clearly not leaving much profit, so we decided to cut back from 1,500 ewes to just 700 and get rid of the 50 suckler cows."

Heather is the natural habit of the red grouse and improving the moor was an early priority. The UK has 75 per cent of all the heather in the world, and Scotland has 75 per cent of that total. The red grouse is unique to the UK and wealthy people will pay considerable sums for the privilege of indulging in what is the most demanding of all game-shooting disciplines. The right to shoot a brace of grouse can cost up to 300 plus VAT, so it was clear to Douglas Miller that if he and his keeper, Ian Elliot, could push the annual bag towards 300 brace then the finances of the estate would look much brighter.

He has embarked on a programme that so far has seen all the sitka spruce shelter belts planted about 40 years ago cleared and replaced by plantations comprising a wide range of native deciduous species. Game crops of triticale and canary grass have been planted, which, together with the new woodlands, Douglas Miller hopes will encourage a revival in the numbers of black grouse. This species has been in serious decline in Scotland for many years, but there are indications that if the correct habitat is available populations will revive.

Chris Badenoch is an independent consultant with a vast knowledge of rural Scotland and is fully supportive of the Douglas Miller approach. He said: "With headage payments there were too many mouths on the hills, which resulted in the growth of rough grasses and the degeneration of the heather. I don't blame farmers - they were just working the old system. However, if it had continued I believe the entire ecosystem would have eventually collapsed. We have to halt and reverse the heather habitat loss in Scotland.

"On estates like this, shooting grouse is the only economic driver. Ramblers have a negative net income effect, but I have no problem with people walking the hills provided they remember it is someone else's property and they take their litter home with them."

That view is supported by Ian McCall of the Game Conservancy Trust, who said: "If the hills are not properly managed then most would in time revert to bracken and gorse, and that is not what the people of Scotland want to see when they go out into the countryside.

"Apart from the direct income from grouse shooting there is also a considerable multiplier effect. On a day when grouse are being driven there could be as many as 80 people out on the moor, and of course the spouses of the guns might well go off shopping in the immediate locality."

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That multiplier effect is already evident at Horseupcleugh, where the new owner has invested in a network of hill roads and built a hugely attractive lodge high out on the hill. These projects were all undertaken by local businesses.

Douglas Miller acknowledges that although he has the capital to make his dream come to fruition - he and his family owned Jenners before it was sold to House of Fraser in 2005 - it might be difficult for a farmer or estate owner of limited means to embark on a similar project.

But there is an answer, according to McCall. He said: "There are some people and syndicates willing to put the cash up front, provided they can secure a lease to shoot grouse for perhaps 25 years.

"It is already happening in some parts of Scotland."

Douglas Miller is nothing if not an enthusiast and clearly relishes pursuing his plans. He said: "This is a long-term project, but I hope to be around to see the young trees we have planted grow to maturity. I also want to see a far greater biodiversity on the hills. We have made a start and I think it will work, but we will have to be patient."