EXECUTIVE SUMMARY
Introduction
A written public consultation on the document "Future Implementation of the Common Agricultural Policy in Scotland" was launched by the Scottish Government on 13th June 2008 and ran until 5th September 2008.
Analysis of consultation responses will be considered by the Scottish Government alongside other available evidence to inform policy decisions relating to the Common Agricultural Policy ( CAP) "Health Check". This refers to European Union proposals to review the 2003 reforms as well as looking ahead to the future of the CAP.
The consultation invited respondents to consider 14 open questions under a range of headings:
- The CAP Health Check proposals.
- Longer-term considerations.
- Potential opportunities:
- maintain environmental benefits of set-aside;
- help new entrants;
- address concerns with current Single Farm Payment ( SFP) system;
- secure the sustainability of livestock farming and crofting in Less Favoured Areas ( LFAs).
- Responding to the CAP Health Check.
Respondents
Fifty-five written responses to the consultation were received, comprising four responses from individuals and 51 from organisations. The largest number of responses received was, not surprisingly, from organisations within the farming sector. Given the self-selecting nature of respondents to any consultation exercise, the figures quoted in this report cannot be extrapolated to a wider population outwith the consultation population.
Proportions for particular responses relate to the number of those responding to a specific individual question, which may be lower than the total of 55.
Overview of responses
Given the open nature of the questions it should be remembered that although, in some cases, it has been possible to quantify where some respondents agree or disagree with specific proposals, no assumptions can be made about the remainder as there were those who chose not to answer or who gave more general, descriptive answers.
Where differences in opinion between respondents from particular sectors were identified, these have been reported. However, there were few differences in opinions given by different sectors, albeit answers were presented from different viewpoints and sometimes for different reasons.
The future of Pillar 1 and Pillar 2
The first of the consultation questions asked for views on the rationale for Pillar 1 and Pillar 2 of the CAP from 2014 as well as views on the distribution of funding between the Pillars. Twenty-seven out of the 49 respondents commenting on the future of Pillars 1 and 2 wanted to retain some form of Pillar 1 payments. This could either be through the current system or by way of a revised version. The main concern expressed by respondents was over the viability of businesses if Pillar 1 support is withdrawn; with the consequent risk of land abandonment. Some respondents wanted to see a base level payment retained for the provision of public goods such as animal health, soil, water and habitat management, climate change and food security.
Respondents wanted to see businesses given adequate notice of any changes and for changes to be phased in gradually; any changes should be based on evidence with funding based on clear objectives.
Pillar 2 measures, such as the Scotland Rural Development Programme ( SRDP) were seen as complex and overly competitive with hard to access payments; especially for small businesses.
The consultation also asked for views on what form Pillar 1 support might take, if retained. The majority of respondents felt that there should be a move away from the historic model used to calculate Pillar 1 Single Farm Payments ( SFPs) but 35 out of the 43 commenting did not think a simple, flat-rate system would be suitable.
Respondents felt that payments should be linked to agricultural activity or potential, or subject to cross-compliance measures.
Respondents agreed that the Macaulay Land Use Research Institute land capability classifications could be used as a base or starting point for a model of payments differentiated according to land quality. They felt, however, that the suggested three regions would be insufficient due to the variation in land types across Scotland.
The CAP Health Check
Respondents welcomed the proposals aimed at simplifying cross-compliance and the proposed changes to Good Agricultural and Environmental Condition ( GAEC). There was some concern that the proposals might result in an added economical burden for land managers.
Twenty out of the 38 respondents who commented agreed with the view set out in the consultation that set-aside is no longer necessary and should be removed. However, the environmental benefits of set-aside need to be retained and some respondents suggested that a small percentage of agricultural land should be managed for environmental purposes. Respondents mentioned the importance of ensuring that there is no negative effect on habitat and wildlife.
Although Scotland fully decoupled support payments from production in 2003, other Member States retained a degree of coupling. While over half (18) of the 31 respondents replying to the question on whether decoupling should be continued were in favour of proposals for further decoupling of support; some wanted to see coupled support retained, at least in some areas. Support was seen as especially important to secure the future of the grazing sector; and the additional environmental benefits it provides. Some respondents also wanted to see direct support for hill and upland farmers.
The Health Check proposals aim to ensure access to SFPs (or any replacement) for new entrants to farming; this will be done under the National Reserve. Around half (17) of the 35 responding to the question on new entrants specifically supported the proposals or stressed the need for new entrants to have access to SFPs. Some respondents questioned the need to use the National Reserve if area-based payments are to be introduced; around a third mentioned the need to move away from SFPs or towards area-based payments.
Increased flexibility in the use of the National Reserve can be used to increase unit value or number of entitlements and, in addition, entitlements will not be subject to the same regulations as at present. Respondents were asked a number of questions relating to proposals for the National Reserve and the key theme to emerge, from 11 of the 35 responding to this particular question, was the need to ensure that support is given only to those actively involved in farming. In addition, a number of respondents wanted to see a clear definition of 'active farmer'.
Seven respondents felt that the definition of an eligible hectare should include some link to active production.
Twenty-six respondents commented on proposals for increasing flexibility in the National Reserve and 10 of these responses included support for the proposals. The same number agreed with the proposal to make payments twice a year.
Proposals for increased flexibility in the National Envelope, which has been used to fund the Scottish Beef Calf Scheme ( SBCS), were supported by 14 of the 37 respondents who commented. There were a variety of concerns over the SBCS which was seen as ineffective and inflexible. Respondents felt these limitations had contributed to a decline in livestock numbers, especially in hill and upland areas. This has a consequent effect on the environmental, social and economic wellbeing of the areas involved. Respondents commented on the need for support targeted at hill and upland areas, especially for cattle and sheep farmers.
Modulation, which involves reducing spending on Pillar 1 measures and transferring the funds to Pillar 2 measures; could be subject to two proposed changes and over half (22 out of the 40) who commented agreed with the first proposal to increase compulsory modulation. Respondents acknowledged that proposals would act to harmonise rates across the EU.
However, 22 also made negative comments regarding the second proposal; to introduce progressive modulation. This measure was seen as discriminating against larger businesses and, respondents felt, could result in larger businesses restructuring.
Environmental respondents in particular were concerned that progressive modulation might lead to a reduction in SRDP funding and felt it vital that the SRDP was not compromised by any changes to funding arrangements.
There were 33 responses regarding whether a minimum threshold should be set and 22 of these respondents supported the idea of some form of minimum threshold. Similar numbers supported a minimum payment level of €250 (6) and supported the proposed 1 hectare minimum size (7).
Comments from environment respondents did not specifically support or reject the proposals on setting a minimum threshold but focussed on the need to ensure that there is no negative impact on small producers; a third (11) of those responding had similar concerns.
Around two-thirds (15) of the 23 who chose to comment on mechanisms for intervention in commodity markets agreed with the proposals; around a third (8) wanted to see intervention options retained, at least in some areas.
Just over half (13) of the 25 who replied to the question on the proposals to end milk quotas agreed with the proposals to gradually increase quotas with a view to ending them in 2015.
Proposed changes to the Protein Crop Premium ( PCP) and Energy Crop Scheme ( ECS) were supported by around a third (7) of the 25 responding to the question on small support schemes. A small number of respondents had concerns over the proposals for the PCP.
Other comments
The final consultation question asked respondents whether they had any other comments and 29 responses contained further comments or reiterated their key messages. The most frequently noted related to:
- fairness and uniformity both within Scotland and across the EU;
- support for hill, upland and remote or fragile areas;
- support for livestock numbers;
- the review of the Less Favoured Areas Support Scheme ( LFASS) and/ or the Scotland Rural Development Programme ( SRDP) to be looked at alongside the Health Check;
- adequate funding to ensure successful implementation of proposals.