February 24, 2014
by David Barnes
To make a bit of a change, every so often, I am going to invite a guest blog. This time it is the turn of David Steel who farms in Perthshire and sits on the Scottish Government’s New Entrants panel. The view expressed are his own and don’t represent mine or the Scottish Government. This comes ahead of the Scottish Government New Entrants Gathering to be held in Murrayfield, Edinburgh later this week, on the 26th February.
It has been a real eye opener representing new entrants during CAP reform negotiations and now as a member of the New Entrants Panel. It was a real step forward for Richard Lochhead to ensure we had proper representation within the stakeholder group, and by setting up the New Entrant Panel which discusses and advises on a whole range of matters that affect New Entrants. Nobody can know the requirements better for getting new blood into the industry than newcomers that have been through the mill themselves.
There is nothing like CAP reform discussions to get the various stakeholders retreating into their entrenched positions. As a new entrant, I have taken a view that fairness to all farmers is what CAP reform should deliver. We New Entrants don’t want special treatment, just fair treatment compared with our contemporary established farmers. An example of where this doesn’t look likely, is adopting a gradual change to the new CAP system. This doesn’t deliver fairness, as we new entrants have to stand at a ringside bidding on livestock or tendering for land against farmers who will have much higher single farm payments due to their historical element. So any new entrants reading this needs to complete the CAP consultation and make your views on CAP reform known.
The one thing we find within the New Entrants Panel is that we are all practical, pragmatic people who put the dogma of the various organisations we represent in a backseat, to arrive at common sense, pragmatic positions and solutions.
The single most important issue we presently have to deal with is making sure that the National Reserve for the new CAP picks up all those disadvantaged by the old scheme. This will include many businesses that had small scale activity during the last reference period and have expanded significantly since then. It will also need to pick up those who have started business since then and have bought low levels of entitlements and need to have this made up to the basic area payments levels at least. You can be assured that we know the problems and hopefully we will arrive with a National Reserve Scheme that is inclusive and doesn’t repeat the errors of the past and exclude New Entrants from the subsidy system.
New Entrants Panel member
February 17, 2014
by David Barnes
There’s now only a couple of weeks left to get your responses to us on the SRDP consultation. If you want to influence the shape of the new programme, now’s the time to do it.
For the consultation on direct payments, the deadline is a little later – there’s about a month to go on that one.
I”m writing this in Brussels, as I listen to the new Greek Presidency going through the formalities at the start of the Council of Ministers meeting. At today’s meeting one of the most significant agenda items is a mere Any Other Business point. Virtually all the member states have signed up to an AOB item asking the European Commission to be more communicative about its draft for the detailed implementing rules for the new CAP – the so-called Delegated Acts.
But more important for Scotland than anything on the Council agenda is Cabinet Secretary Lochhead’s meeting later today with Commissioner Ciolos, about slipper farming and coupled support. Lack of clarity isn’t helpful for anyone, and I hope we come out of the meeting with a clearer understanding than when we went in.
It sounds like the Greek minister is getting to the end of the formalities – yes they really do go on that long (!) – so I’ll sign off ready for the start of the Council meeting proper.
February 5, 2014
by David Barnes
Responses to our two CAP consultation documents are coming in, on both the SRDP (CAP Pillar 2) and Direct Payments (Pillar 1). This is a really important part of the policymaking process, so I’d encourage everyone with an interest to send us a response.
The consultation documents can be found at http://www.scotland.gov.uk/Publications/2013/12/7550 (SRDP) and http://www.scotland.gov.uk/Publications/2013/12/5922 (Direct Payments).
At this stage, in mid-consultation, government officials (and ministers) have to be careful what we say, so that we don’t inadvertently influence the final consultation results. But I can give a factual update on some things that have happened or are about to happen.
A couple of weeks ago our New Entrant Panel met. New entrants have a special interest in how the National Reserve for direct payment entitlements will operate, so we kicked off some detailed work with them on the kind of criteria we might use. Last week we published farm income estimates for 2013 (http://news.scotland.gov.uk/News/Indications-of-farm-income-recovery-8c1.aspx). On the same day, the Government gave MSPs an opportunity to set out their views on implementation of the new CAP, in a debate in the Scottish Parliament. Cabinet Secretary Richard Lochhead’s speech in the debate is at http://news.scotland.gov.uk/Speeches-Briefings/Parliamentary-debate-on-implementation-of-the-Common-Agricultural-Policy-8c7.aspx.
And today, 5 Feb, our CAP stakeholder group is meeting for the first time in 2014.
One of the issues on the agenda is the so-called ‘Scottish clause’ under which we will be able to apply activity requirement to future farm payments. It was Mark Twain who said ‘the reports of my death have been greatly exaggerated’, and a similar comment could apply to the Scottish Clause. The European Commission’s first draft of the detailed implementing rules wasn’t acceptable, and we had to lobby to get it changed; but we succeeded, and now we can put together a plan that will mean if there’s no activity on the land, then it won’t be eligible for payments. We’ve identified at least two alternative ways to do this, on which we’ll get stakeholders’ views at today’s meeting before working them up further.
December 20, 2013
by David Barnes
In more than two years since the CAP negotiations began, there’s been more to write about some weeks than others. This has been a bumper week.
On Sunday I set off for Brussels for the final step at Council of Ministers level, namely the formal adoption on Monday of the package of CAP regulations. As always there was an opportunity for useful discussions in the margins, and I was present when Cabinet Secretary Richard Lochhead spoke with Commissioner Ciolos about the Scottish Clause.
Monday was also the closing date for our ‘mini-consultation’ on the Pillar 1 to Pillar 2 budget transfer.
Then on Tuesday we launched the second of our two big consultation documents, on the new direct payments system. On occasions like this, when we publish complex information, we appreciate that journalists can face quite a challenge to analyse and write about it the same day for the next morning’s papers, so we sometimes offer them the opportunity to be briefed directly by officials. This is a chance to seek clarifications, or ask technical questions. We did that on Tuesday by teleconference and quite a few journalists took part.
Then on Wednesday Mr Lochhead announced his decision on the budget transfer, by confirming the rate of 9.5 percent – in time to meet the EU notification deadline.
This will be my last blog before Christmas, so a very merry one to all.
December 9, 2013
by David Barnes
Last Thursday, Rural Affairs Secretary Richard Lochhead attended one of our CAP stakeholder group meetings, to launch our short consultation document on Pillar-to-Pillar budget transfers under the new CAP.
We’ve called it a ‘mini-consultation’ because it only covers one issue, and because the EU’s deadline for our decision means we can only give stakeholders a couple of weeks to reply on this occasion. Having said that, we already carried out a full two-month consultation on this same issue earlier in the year. What’s new is that we now know Scotland’s allocations in the two Pillars, enabling us to make the question specific rather than general.
Mr Lochhead’s comments explain the rationale for the proposal to which responses are sought, and I won’t attempt to paraphrase them. But they highlight a couple of the issues we’re grappling with on the new CAP.
One is about balance. In an ideal world, it would be possible to pursue every one of our desired policies to the maximum. But the world isn’t like that, so we’re constantly having to reach judgements on where the best balance between competing considerations lies – in this case, between the need to have a big enough budget for the new Scottish Rural Development Programme (SRDP), and the wish not to have to reduce Pillar 1 direct farm payments. It’s that balance on which we would now like views.
The other issue is about focus. A common criticism of the current CAP, and especially the current SRDP, is that it tries to be all things to all people. Indeed, when the 2007-13 SRDP was designed back in about 2006, there was a deliberate decision to offer an open menu of options, in the expectation that local decision-making by project assessment committees would sort out the best projects from the rest – in other words, the correct focus would be applied at local level. In the event, that system didn’t work out as planned. So for the new programme, in a couple of years of discussions with stakeholders, we’ve often heard the message that clearer top-down focus would be a good thing, especially if the budget is going to be less than we would have hoped – if there’s little jam in the pot, it’s important not to try and spread it too thinly. So you’ll see that spirit reflected in the illustrative SRDP budget allocations in the mini-consultation.
But the allocations are just there for illustration at this stage. The mini-consultation is about the single issue of the size of the funding transfer. Those budget allocation proposals will be fleshed out later this week in the full SRDP consultation, for decisions to be taken next year.
November 21, 2013
by David Barnes
Unusually, there’s no meeting of the EU’s Council of Agriculture Ministers this month. But there have still been important developments at EU level.
The decision on ‘financial discipline’ affecting the 2013 Single Farm Payment has been formally adopted. This is the mechanism which says that if the EU’s expenditure elsewhere in Pillar 1 goes up (Eg if spending on market support measures for farm products is higher than planned) and there’s a risk of the overall Pillar 1 budget being exceeded, SFP has to be cut in all member states in order to stay within-budget.
This has been part of the CAP for several years but this is the first time it’s been triggered. The cut of just over 2 percent is of course not welcome, but is considerably lower than was originally proposed, and we successfully negotiated down Scotland’s share of the cut.
There have also been two important votes in the European Parliament, confirming formally its approval of the budget deal for 2014 to 2020, and the package of CAP regulations.
You may well have thought that these were both agreed months ago. Indeed, in the case of the CAP regulations, nearly everything was agreed in June and the final details were negotiated in late September. But formally speaking the regulations had not been through the necessary voting procedures.
Now that the Parliament has had its vote, the final step is for the Council to formally adopt the regulations, probably in December – just a few days before the new CAP was originally supposed to take effect on 1 Jan 2014. Clearly it’s impossible to implement things in that timescale, which is why transitional arrangements will apply in 2014.
If Europe learns lessons from this CAP reform round, I hope one of them will be that either the process has to start earlier, so that new rules can be introduced on time, or alternatively that transition arrangements must be part of the reform process and not a late afterthought.
November 18, 2013
by David Barnes
I can’t believe nearly three weeks have passed since I last blogged. There’s so much going on that time’s flying by.
On 8 November the UK government announced the within-UK allocations under the new CAP budget. The Scottish Government was deeply disappointed with the decision –Cabinet Secretary Richard Lochhead made a statement to Parliament on it a few days later, which you can read at http://news.scotland.gov.uk/Speeches-Briefings/Parliamentary-statement-on-Common-Agricultural-Policy-Budget-615.aspx
On top of that, we’re working hard to complete our consultation documents on the two Pillars of the new CAP, direct farm payments and our new rural development programme. The rural development (Pillar 2) consultation will be out first, with the Pillar 1 document following soon after.
We’re very keen to get as many responses to the consultations as possible. We’ll be publicising the documents widely when they’re published, and emailing stakeholder organisations plus individuals who we know are interested because they’ve responded to earlier consultations. On top of that, we’re arranging collection boxes in our local offices, and on our stand at AgriScot this week – people can drop in a business card, then when the consultations come out we’ll alert them.
As usual Mr Lochhead will be speaking at AgriScot alongside NFUS President Nigel Miller, with a Q&A session afterwards. I predict there’ll be plenty to talk about.
October 31, 2013
by David Barnes
We have a big day coming up on Friday. To supplement our many CAP stakeholder group meetings, we have offered the group members a ‘Technical Day’ to look at some of the more detailed aspects of the new Direct Payments system.
One issue we’ll be covering is the ‘internal convergence’ mechanism by which we’ll move towards area-based payments from the current historic-based system. At one point during the recent EU negotiations, the draft text included half a dozen different ways of doing this, each of which looked more complicated than the last. Thankfully there was a huge simplification before the text was finalised, and we can now set out what the final version requires.
We’ll also, as promised earlier in this year, share some of the results of the latest phase of our modelling work. We’ve taken the excellent modelling from phase one on different options for payment regions, and added in the impact of additional variables – like whether or not we use the ‘redistributive payment’ to give a top up on the first few hectares of every claim.
Often in our meetings with stakeholders we are seeking to get their views on policy issues. The Technical Day will be different in that the aim is simply to get a common and accurate understanding of how the new system will work, on the basis of which we can then collect policy views later via our forthcoming consultation exercises.
In the next few weeks we’ll be issuing consultation documents on our detailed plans for both the Pillar 1 Direct Payments system and the Pillar 2 rural development programme – and we want to encourage as many people as possible to respond. We’ll be delighted to receive responses from the usual suspects, but we’re also really keen to hear from those who don’t often tell us what they think.
After all, we’ll be making the kind of strategic decisions that only come round every five to seven years. So if you want an opportunity to influence government decisions, these consultations will be the time to do it.
October 18, 2013
by David Barnes
A few days ago I was in the Borders with a group visiting a flood risk management project, which gave me some food for thought for the new SRDP.
The project consisted of taking a river which was deliberately straightened 200 years ago, and reintroducing meanders in a couple of places to slow the flow in the event of heavy rainfall. In addition, the surrounding land will be planted with native woodland designed to flood if necessary to save the town of Peebles downstream. For two bits of earth-moving costing just over 40 thousand pounds, nearly 600 houses will have their flood risk reduced significantly – which looks to me like fantastic value for money.
The visit prompted two thoughts about the new SRDP.
The first was that delivering environmental or other benefits doesn’t have to mean reducing food production. In this case the sites for re-meandering were chosen carefully. Productive fields were avoided. A hectare or two of grazing land will be converted to woodland, but it was so boggy and unproductive that the farming operations will be essentially unaffected.
The second thought was that, whilst it won’t have been simple putting together the funding for the project, that will have been a walk in the park compared with the task of getting all seven affected landowners to agree – a process which allegedly took a decade or more, and was only successful due to persistent efforts by the Tweed Forum. This reinforced my view that if we really want to encourage collaborative projects in the next programme, we have to consider allowing funding not just for the works themselves, but also for the task of facilitating agreement and getting the project together in the first place.
October 10, 2013
by David Barnes
Today the European Commission should be formally adopting its proposal for reductions to 2013 CAP direct payments under the so-called ‘financial discipline’ mechanism. This is something that’s existed in the CAP for many years, but has never before been triggered.
When talking about Pillar 1 of the CAP we tend to focus on the direct payments to farmers – which are based on fixed budgets for each member state, making expenditure levels very predictable. We sometimes overlook the fact that there’s another element in Pillar 1, namely the money the EU spends on supporting the market for agricultural products.
Market support expenditure nowadays is small compared with 20 or 30 years ago when it was the major plank of the CAP. But it still exists, and by its nature it’s much more variable year-to-year than direct payments expenditure. The financial discipline mechanism says, in effect, that if in any year it looks like Pillar 1 expenditure is going to exceed the Pillar 1 budget, then direct payments must be reduced in order to stay within budget. In other words, if market conditions cause market support expenditure (which is after all to the benefit of farmers) to rise too much, then this must be resolved by reducing other farm payments and not by increasing the Pillar 1 budget.
As I mentioned, it’s never been triggered before, but now it has and it will affect the 2013 payments which will start this December. The good news is that we have been able to limit the impact on Scotland.
The European Commission’s original proposal was that only farmers receiving more than €5000 should have their payments cut, by just under 5%. The effect of the €5000 threshold would be to skew the cuts away from member states with a smaller size of average farm, and towards the rest – including us. So we and others lobbied hard to get that threshold reduced. Now the final version we expect the Commission to adopt will impose a reduction of 4% on farmers receiving more than €2000. Unfortunately this means slightly more Scottish farmers will receive a cut. But in terms of total sums, this is more than offset by the resulting drop in the cut from 5% to 4%, meaning Scottish agriculture as a whole is several million better off.