NFU Scotland has expressed very serious concerns regarding the future of Scotland's Less Favoured Areas Support scheme (LFASS) in a letter to the European Commission.
The LFASS currently delivers approximately £65 million of rural development funding to hill farmers and crofters in some of the most vulnerable and fragile parts of Scotland, providing an essential injection of funds to the rural economy in those parts.
As things stand, European regulations mean Scotland faces the introduction of LFASS "parachute payments" from 2019 in lieu of moving to an Area of Natural Constraint (ANC) scheme. In effect, while this means that LFASS will continue to run, the payments must be capped at 80 per cent of current levels. Moreover, EU regulations then stipulate that the payments for 2020 must be at 20 per cent of current levels.
According to NFUS that is a scenario that would have huge implications for hill farmers and crofters, dramatically eroding a vital income stream.
The Union raised this issue in person with Commissioner Phil Hogan when they met in Edinburgh in the spring and NFUS has now written to the Commissioner on the matter.
After sending the letter, President Andrew McCornick said: "The EU Omnibus Regulation has provided a delay from sweeping changes to LFASS but, nevertheless, many of Scotland's upland and hill farmers and crofters in more fragile and remote communities still face a cliff-edge in terms of drastic cuts to what NFUS regards as a life-line support payment.
"Clearly, the issue is made more complex by the Brexit process. If the UK were to remain a Member State, then Scotland would almost certainly have to develop and implement an ANC scheme to meet EU requirements.
"With the UK's withdrawal from the EU creating unprecedented uncertainty, both NFUS and the Scottish Government are seeking as much stability as possible through the process in order to minimise the adverse impacts on farmers and crofters, and the rural economies, environments and communities they underpin.
"Under the current terms of the Brexit "Implementation Period" between March 2019 and December 2020, the UK and Scotland would have to adhere to the existing regulations. That would require the Scottish Government to cut LFASS payments to a significant and devastating degree.
Mr McCornick went on: "NFUS has already begun discussions with the Scottish Government to consider all potential options to overcome this imminent and very real threat. However, we are seeking Commissioner Hogan's support by instructing his officials to explore what options might be available to allow Scotland to continue to pay LFASS in full through what will be temporary or transition arrangements."
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