Scottish farming faces 'cash crisis' over CAP payment delays

Many Scottish farmers rely on the CAB payments to supplement their main income

Delays in EU payments have left many Scottish farmers facing a cash flow crisis, according to the head of a farming union.

NFU Scotland president Allan Bowie said only a third of Scotland's farmers had so far received their Common Agricultural Policy (CAP) claims.

The payments have been affected by major issues with the IT system used to administer them.

The Scottish government said farmers would be paid as quickly as possible.

And it said the complexity of the new CAP system had also hindered the process.

Reforms to the CAP system saw the Single Farm Payment Scheme replaced by the new Basic Payment Scheme (BPS) last year.

Safety net

The BPS is the main EU subsidy available to farmers in Scotland, with the money being allocated by the Scottish government.

The payments are designed to act as a safety net for farmers and crofters by supplementing their main business income.

Mr Bowie told delegates at NFU Scotland's annual general meeting in St Andrews that many Scottish farms and crofts were under "severe pressure" as a result of the delays, coupled with the adverse weather and volatility across all sectors.

He added: "The worry and stress of not knowing when support streams will start to flow is starting to impact on the health of our hard-working farmers.

"We need to start seeing movement and delivery before purdah comes into play for May's Scottish Parliamentary elections and the chance to publicly call our politicians to account is lost."

Mr Bowie said initial estimates for the Total Farm Income figure for Scotland in 2015 showed a decrease of 15%.

This would only the second time this century that incomes have fallen for two consecutive years, he added.

Mr Bowie also said there was a knock-on impact for the rest of Scotland's rural economy.

He added: "Twenty months on from the cabinet secretary's initial statement on CAP implementation, the majority of Scottish farmers still remain completely unaware of when they will receive support payment under the new schemes.

"To date, only a small share of basic payments and greening payments have been made so far and, compared to this time last year, around £440m is outstanding to farmers.

"That is the hole in the Scottish rural economy that Scottish government is responsible for and the reason why the wheels have stopped turning in the Scottish countryside."

'Lost trust'

Scottish Rural Affairs Secretary Richard Lochhead is to address delegates at the NFU Scotland AGM on Friday morning.

The issue was raised by Scottish Conservative leader Ruth Davidson in the Scottish Parliament.

Ms Davidson claimed that the first minister had "lost the trust of rural Scotland" as a result of the delays to payments.

In response, Nicola Sturgeon said the Scottish government was working to ensure that payments are given to farmers as quickly as possible.

She added: "It is true that processing payments has taken longer than we intended due to the complexities of the new CAP system and we have been open with farmers and with industry about these complexities and what we are doing to address them."

Ms Sturgeon said the payments began at the end of December and as of last week 35% had been made.