Scottish farmers awaiting 2017 support face 'serious cash flow problems'

Scottish farmers who have not received 2017 support payments could now be facing "serious" cash flow problems following an "unpredictable and challenging" year.

Farmers and crofters still awaiting payments from 2017 schemes are urgently pleading for quicker government processes in order to safeguard their businesses, according to NFU Scotland.

Many are still waiting for payments under a variety of Scottish Rural Development Programme (Pillar 2) schemes, including the Less Favoured Areas Support Scheme (LFASS), Agri-Environment Climate Scheme (AECS), Forestry Grant Scheme (FGS), Rural Priorities (RPs) and Land Managers’ Options (LMOs).

These payments may not always add up to those of the mainstream agricultural support of Pillar 1 payments, but for farmers and crofters whose margins are extremely tight they are seen as vital for cash flow and keeping businesses afloat.

It follows a difficult and challenging year for many, especially due to additional costs driven by the extended adverse weather.

'Serious cash flow problem'

NFU Scotland President, Andrew McCornick said outstanding payments must be paid "as soon as possible".

“Although a good amount of payments have been made, for those individuals with outstanding sums due we must pull out all the stops to ensure that all payments are made in full as soon as possible," Mr McCornick said.

“A farmer or crofter who may not have received Pillar 2 payments over the last two years could now be finding themselves with a serious cash flow problem, especially after the winter and summer we have had.

Some farmers awaiting 2017 Less Favoured Areas Support Scheme (LFASS) payments are situated in disadvantaged areas, who face increased costs and minimal returns.

“LFASS payments can be a large chunk of overall support for many in more disadvantaged areas – who face spiralling costs and flat-lining returns at best," Mr McCornick added.

"Outstanding payments at this time of year can seriously hinder how they are able to plan for the coming winter and spring – undermining efforts to become more resilient."

'Less enthusiasm'

Many of the environmental and forestry schemes require initial investment from farmers before payments can be made.

But NFU Scotland are concerned that if farmers and crofters see expensive initial outlays and uncertain payments schedules, then there will be less enthusiasm to engage in measures that are intended to deliver public benefits.

Mr McCornick said: “It is important that these payments are made sooner rather than later, not just for the farmers and crofters but also for Scotland’s wider rural communities.

“When farmers are properly supported, the positive impact is felt throughout surrounding areas with businesses such farm shops, fencers and mechanics all reaping the benefits.”