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Wednesday, 14 February, 2001, 06:18 GMT
Farming 'disaster' warning
Tractor in field
Crofters have voiced concern over changes
Scottish farmers' leaders have predicted an economic catastrophe if changes to the Less Favoured Areas subsidy scheme are allowed to go through unchecked.

The reforms are being phased in over the next three years but many farmers and crofters fear they could lose their livelihoods.

Rural Affairs Minister Ross Finnie said he has accepted that the situation is bad, but has rejected criticism that he did not consult with farmers.

He said Scottish officials tried hard to get Europe to recognise the particular difficulties of farming in Scotland.

We've tried very hard indeed to make a basic system that was not really suited to Scottish agricultural circumstances work as best we can

Rural Affairs
Minister Ross Finnie
It was also announced on Wednesday that the European Commission would seek to change the way beef subsidies are paid, with potentially devastating results for Scotland.

About 83% of Scotland's agricultural land qualifies for Less Favoured Area status.

This is a European Union scheme designed to support farmers in the most difficult conditions.

Historically, farmers were paid a subsidy on a "per animal" basis.

However, as part of wide-ranging reforms to the system this is being changed to an acreage system where they are paid by area.

Sliding scale

Acreage is said to favour larger landowners and could result in unused land effectively raking in money.

The Scottish Executive had to come up with schemes that would be acceptable within EU guidelines.

The executive scheme divides Scotland into very broad areas and offers subsidy rates for improved pasture or rough grazing.

Farmers have already seen a decline in incomes
These replace the subsidies which were offered per animal.

The payments will gradually decrease over the next three years.

Western Isles Labour MP Calum Macdonald said: "I think the problem is with the way the scheme has been implemented.

"Not the overall philosophy behind what Europe is trying to achieve, but the way it has been implemented on the ground by the department officials.

"I know that Ross Finnie has tried to reassure people by saying that the most that people would lose in the first year would be something like 10%.

Failure claims

"However, the typical crofter will be getting less than 1,000, so even a small drop in that can force a crofter away from crofting."

Scottish Tory rural affairs spokesman Alex Johnstone said that, although the rural affairs department had consulted with the National Farmers' Union, there had been a failure to speak to other groups like the Scottish Landowners Federation and the Crofters Union.

Ross Finnie
Ross Finnie: Under fire
Rory Dutton, director of the Crofters Union, said the scheme fails to deliver and does not discriminate effectively on the varying degrees of disadvantage from area to area.

However, Mr Finnie rejected the accusations.

He said: "We've tried very hard indeed to make a basic system that was not really suited to Scottish agricultural circumstances work as best we can.

"Don't get me wrong. This situation is not a happy one. Not one I've every been happy about.

"But, to suggest that we didn't consult with farmers. To suggest that we did not push very very hard indeed with Europe for a system that would meet Scottish circumstances, is simply not true.

"We were one of the last countries to come to an agreement because we were holding out, recognising that Scotland's agricultural structure meant that we had particular problems."

He said a scheme put forward by the rural affairs department which had six differentials of support was rejected by Europe.

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See also:

13 Feb 01 | Scotland
Beef subsidy blow for farmers
30 Mar 00 | Scotland
Scotland shares in farming package
31 Jan 00 | Scotland
Scottish farm incomes plummet
17 Mar 00 | Scotland
Farmers sour over milk price
11 Jan 00 | Scotland
Farmers' help plea to parliament
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