Rural support loans likely continue for a fifth year

Emergency measures put in place in 2015/16 to deliver £500 million of Common Agricultural Policy funding, after a Scottish Government’s IT system worth £178 million crashed, is likely to continue for at least another year.

According to a response from the Minister to North East Liberal Democrat MSP Mike Rumbles, there are no plans to bring the loan system for Pillar 1 Basic Payments to an end. That will mean using pre-payment loans for the fifth year in a row, despite claims that the IT programme is ‘functioning effectively’ and the additional cost in staff overtime amounting to £1.8 million over the previous four years.


Mr Rumbles said: “We are in the absurd situation where the Scottish Government must administer farm payments twice each year, once as a loan and then again to pay off the loan.


“At a time when our rural economy is reeling from uncertainty over Brexit and farm businesses are facing unprecedented changes it hardy inspires confidence in our government in Edinburgh.


“The Scottish Government has paid software designers £178 million for an IT system that the Minister has said is functioning properly. So why are our farm businesses and rural communities being forced to take on short-term loans to pay for essentials such as feed, seed and farm maintenance over the winter months?”



Notes for editors:     


  • Parliamnetary Question: Mike Rumbles (North East Scotland) (Scottish Liberal Democrats): To ask the Scottish Government whether the IT system for administering the Basic Payments Scheme is functioning to the required standard, and whether a loan scheme will be required to deliver payments for 2019-20. S5W-22762



Fergus Ewing: The Scottish Government’s CAP IT system is functioning effectively and dealing with many thousands of Pillar 1 and Pillar 2 applications and payments each year, demonstrating stability in our processes. The Single Application Form (SAF) application window for 2019 opened on 15 March as planned and the system is performing to a high level of availability for customers. Last year, we saw a 10% increase in the number of customers using the system to submit online applications. We are on track to deliver 2018 scheme year payments across CAP schemes in line with the payment schedule published in December, including meeting the regulatory target to make Pillar 1 payments by the end of June 2019, as we did last year.


We have used loan schemes over the last few years to guarantee certainty to farmers and crofters over when they will receive their payments. For scheme year 2019 we will keep the situation under review, especially in consideration of the uncertainty caused by EU Exit process.


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