The Scottish Tenant Farming Association (STFA) has welcomed the news the Scottish Government no longer intends to impose the 50 per cent siphon on Basic Payment Scheme (BPS) entitlements when a tenancy is transferred by assignation or succession to a new tenant.
The move follows legal opinion commissioned by STFA.
Article 34 of the EU regulations provides Member states with the option to siphon part of the BPS entitlements into the National Reserve. In an attempt to discourage trading of entitlements and slipper farming, the Scottish Government elected to apply a 50 per cent siphon to entitlements transferred without land.
Until challenged by STFA, the Scottish Government had intended to treat the transfer of an agricultural lease as a "transfer without land" and therefore liable to trigger the 50 per cent siphon. It has now recognised that legally, a tenant occupying the land under an agricultural lease holds an interest in the land and so, transferring that interest counts as a transfer of land and should not therefore be subject to a siphon.
Commenting on the result STFA chairman Christopher Nicholson said : "The Scottish Government's interpretation of the rules, which only came to light by chance, could have been devastating to many tenants who have just, or who were about to pass their tenancies on to the next generation. "Fortunately this mistake has been spotted in time and can now be corrected so tenants who have recently taken over a family tenancy can be reassured that they will not lose half of their single farm payment.
"We are surprised that government officials interpreted the regulations in such a narrow way without considering possible unintended consequences and how they could be avoided. Without STFA's intervention we would have been in the ludicrous position where government policy was encouraging wider family succession to tenancies with one hand and clawing back single farm payments with the other."
Minimum wage increase for agricultural workers
The Scottish Agricultural Wages Board (SAWB) has agreed that the minimum rate of pay for agricultural workers with more than 26 weeks continuous employment will increase by 10p per hour to £7.24, bringing the minimum wage for a 39 hour week to £282.36.
The minimum rate of pay for agricultural workers with less than 26 weeks continuous employment will increase by 20p per hour to £6.70 bringing the minimum wage for a 39 hour week to £261.30. This increase is in line with increases to the National Minimum Wage.
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