Minister and union play down £35m EU penalty

The fine has been imposed following a large number of discrepancies found by the auditors on the amount and nature of the area of land included in the subsidy claims. Specifically the auditors were concerned with claims for non-productive land such as farm roads, areas under buildings and areas of bracken or scree.

Rural affairs secretary Richard Lochhead said the fine was much less than that imposed on other member states.

And the union was quick to stress that the penalty – or, in European jargon, a disallowance – would not affect individual farmers’ subsidy payments.

Union president Nigel Miller admitted the fine was not good news “but a key point for farmers to keep in mind is that this announcement will have no impact on their payments and is pitched at a national level”.

That point was confirmed by Lochhead, who said provision had already been made to cover the cost of the disallowance in the Scottish Government budget and there would be no impact on farmers or existing budgets.

Lochhead claimed that, thanks to government efforts, the penalty had been kept as low as possible. “At less than 2 per cent of the total spend for the three years concerned, the disallowance level is well below the EC’s often-used flat rate of 5 per cent ‘financial correction’,” he said.

In his reference to Scotland’s favourable outcome compared to other countries, he pointed out the £35m was nowhere near the level of fines imposed on Sweden, which recently faced a disallowance of £65m, or Denmark, which faced a penalty of £105m.

Closer to home, England was disallowed around £175m and in Northern Ireland the figure was £80m. In total ,24 out of the 27 EU member states have received a disallowance relating to their area aid payments between 2005 and 2011.

Looking forward, both the government and the union believed that now farmers and inspectors were more aware of the standards, there would be no major problems in the future