Pack report fails to allay support fears

FARMERS looking for a magic formula to emerge from the inquiry into future support for the industry may feel a little disappointed when they read the interim report by Brian Pack.

But there is a suggestion that a large percentage of the current support cash should be transferred into a fund which farmers could access in exchange for meeting several defined targets.

The report also confirms that moves should be made to area-based payments as soon as possible and that such a move, although likely to bring big winners and losers, should be carried out quickly and not over an elongated timescale.

Speaking in Perth at the release of the report, the author stated that it should be considered as no more than an "aunt Sally" for stakeholders to comment on and bring fresh evidence to.

As such, Pack and his colleagues on the inquiry will start next week on a round-Scotland series of meetings prior to producing a final report in April. The Scottish Government will then consider this prior to heading off for negotiation on the future of the CAP in Europe. Pack admitted that one of the big challenges facing the industry is finding a formula that would retain the all-important livestock sector, thus preventing increasing level of abandonment of land in the livestock producing areas in the north and north west of Scotland following the de-coupling of support.

The suggestion is that the move to area-based subsidies should include a clause making it necessary for farmers to have a minimum stocking level before receiving a certain level of support.

The second main strand of their suggestions is that at least one third of the total amount of cash currently going into the industry in support should move into a Top Up Fund. This cash, approximately 150 million annually, would then be awarded to farmers who would sign contracts for a wide range of objectives.

Pack said his team had not had time to work out a detailed or comprehensive list but suggested they could include animal health schemes, reduced usage of nitrogen, fuel efficiency, water management or renewable energy. Refining that particular proposal, the report also suggests that up to half of that 150m could go into specific sectors that would improve efficiency and competitiveness, but which could mean cash going for projects and targets within the livestock industry.

Contrary to the opinion of MEP George Lyon, who last week expressed the view that the move to area-based support would take a long lead-in time, Pack is proposing a quick changeover. He believes it could all be achieved by 2014 if it is based on existing Macaulay Land Capability grades with the whole-farm payment being based on a total aggregated from the dominant grade per field. This entitlement would not be transferable.

The inquiry team has also proposed that the area-based payment for each farm is set annually so that changes in farm practice would alter the cash.

Pack admitted that in setting out the broad proposals the easy part had been achieved. Getting a consensus from now on in would be more difficult.

Clearing one contentious issue up, he stated that those who had sold their quota and continued farming should not face any financial hurdle for so doing. "That commitment closes in 2013." There will be a dilution in the distribution of money on an area basis as another half million acres, or 10 per cent of the total, will come into the equation.