More Coupling in Scotland

The Scottish Government has seemingly received a boost in its plans for implementing CAP reform.  If confirmed, this would allow greater use of coupled payments, and also allow ‘slipper farmers’ to be targeted.

The Farm Minister, Richard Lochhead, had a meeting with Commissioner Ciolos and apparently received the EU’s backing on these two points.  On coupling, the EU rules state that a maximum of 8% of the BPS budget can be used for coupled payments – Scotland plans to use the maximum.  However, within the UK, only Scotland plans to use coupling.  Therefore, at a UK level, the percentage used is well below 8%.  Mr Lochhead has proposed borrowing some of the unused threshold to increase Scottish coupled payments to 13% of its BPS funds.  Commissioner Ciolos has given his approval in principle to this interpretation of the rules. 

The Scottish Government is at pains to point out this will not involve any shift of actual money between parts of the UK.  All it is doing is borrowing the ability to use more of its own funds in a certain way.  With EU approval secured, DEFRA now needs to sign-off on the plan.  We see no reason why it wouldn’t, as Scotland is simply shifting its money around.  The only reason to block it would be if London thought high levels of Scottish coupled payments created unfair competition.  If more money is available for coupling in Scotland it seems likely that this would be used to extend the calf scheme to 50% beef-bred animals, introduce a sheep headage payment, or even some grazing supplement in the LFA.

The other issue raised in Brussels was that of slipper farmers.  We wrote earlier in the month about the problems of introducing a minimum stocking rate as the test of activity (due to WTO rules).  The Scottish Government stated that it had come up with an alternative requiring farmers to ‘keep livestock at an appropriate level linked to the carrying capacity of the land, or demonstrate significant active efforts every year to maintain agricultural land’.  Whilst the Administration is claiming that the EU has approved the plans, it is not clear what this means in practice.  A little additional guidance is provided by the notes from the recent ‘Stakeholders’ meeting (see http://www.scotland.gov.uk/Resource/0044/00443488.pdf ) but even this is not very clear. 

We shall, of course, report on any further detail on these issues as it becomes available.