Scotland-Talking farming problems.

SCOTLAND--problems in farming.

OVER this weekend, sheep farmers from all over the country will meet to discuss a proposal that could divide the Scottish agricultural industry.

The move would see the sheep sector asking the Scottish Government to invoke a piece of European Union legislation that would provide special support for those who keep sheep.

Although the price of lamb has reached unprecedented levels in recent weeks, the bigger long-term concern of the sector has been the dramatic reduction in the number of ewes being kept on farms and crofts. Over the past decade, Scotland has lost around one million breeding ewes and, despite current high prices, there is every indication that this trend will continue, especially in the more remote areas where many large estates are teetering on the brink of viability. Selling off sheep and paying off shepherds is one of the few options left to such landowners.

Sheep farming is clearly in decline and its gross output is easily dwarfed by the arable sector. Milk producers, despite current low prices, also have an output comfortable in excess of the sheep industry.

But there is growing pressure in certain quarters to invoke Article 68 of the EU Common Agricultural Policy. This would allow individual member states and devolved regions such as Scotland to transfer funds from the total level support towards sectors which are struggling.

This would involve "top-slicing" the single farm payment (SFP), worth in excess of £400 million each year to Scotland.

There is a precedent for such moves in the specialist beef sector, supported by the Scottish Beef Calf Scheme. This provides a payment on each beef calf reared. However, it is not universally popular with beef finishers who have no breeding herds because they are losing a proportion of their SFP.

The issue of additional support for the sheep sector arose last month when Mariann Fischer Boel, the EU agricultural commissioner visited Scotland. She suggested that the issue of falling sheep numbers could be tackled by invoking Article 68.

Both NFU Scotland and Richard Lochhead, the Cabinet secretary for rural affairs, have indicted that they would prefer to see support go to those who actually produce something. However, there is a social aspect to the CAP and many who have cut back on production see no reason whey they should lose a slice of their CAP entitlement in favour of units where there is a higher degree of productivity.