Farming: Support payments brought forward to help with spiralling costs

Farm support payments are to be brought forward by almost a month to help the industry address the cash flow and inflation crises which are currently hitting the sector.

NFUS president Martin Kennedy.

The Scottish Government yesterday confirmed the move which had been requested by farming bodies in the face of the sharp increases in farm input costs and which had left many farm business bank accounts in the red.

Rural Affairs Secretary Mairi Gougeon said that, subject to the approval of the Scottish Parliament, farmers and crofters would start to receive their advance payments for the Basic Payment Scheme (BPS) and Greening from September 19 onwards rather than October 16.

“The decision follows a request from farming groups in Scotland to relieve immediate inflationary pressures and protect jobs in Scotland’s world-leading food and drink sector,” said Gougeon who added that the move followed a review of the legislative, IT and budget requirements associated with bringing the date forward.

Gougeon said that given the sharp rise in energy, fuel and fertiliser costs in recent months, she was acutely aware that businesses across Scotland were facing a hugely challenging increase in their bills: “This is compounding the challenging operating environment caused by the Covid-19 pandemic and the hard Brexit imposed on Scotland by the UK Government, which has inflicted significant and lasting damage on our world class food and drink industries, rural and coastal communities,” said the cabinet secretary.

“That is why I have listened to the representations from the farming and crofting community and will bring forward the advance payment start date to as early in the year as is practicably possible. The intention is to support businesses, as far as possible, with immediate cash flow challenges.”

She said that while the start date of payments was changing, the target remained the same – to pay over 70 per cent of the anticipated £420 million expenditure by end of December 2022 and 95.24 per cent anticipated expenditure by end February 2023.

Welcoming the move, NFU Scotland said that it would deliver vital cash flow certainty to farmers and crofters and help with business planning: “It will also allow the thousands of farmers and crofters attending the Royal Highland Show next week to budget and plan for any purchases or deals they may do at this important event in the Scottish farming calendar,” said union president Martin Kennedy.

He said that the announcement came a month after 11 key Scottish farming organisations wrote to the Scottish Government to express concerns over the impact that the unprecedented cost inflation was having, and which called for the payments to be brought forward.

He said that the unprecedented input price pressure around the likes of fuel, fertiliser, feed grain and wages was having a significant impact on business decisions at a farm level and both up and downstream in the supply chain: “While there is no quick fix to the current crisis, the Scottish Government decision to agree to our request and bring forward Basic Payment Scheme (BPS) and Greening payments will help to build confidence across the industry.”

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