EU funding guarantee

Scotland’s Rural Economy Secretary Fergus Ewing has written to the UK Government to seek a clear and comprehensive guarantee on the extent the UK Government’s guarantees relating to EU funding.

In his letter to the UK’s Secretary of State for Environment, Food and Rural Affairs, Michael Gove, Mr Ewing emphasises the divergence of statements coming from the UK Government is creating unhelpful confusion that is already causing real problems for Scottish businesses in their efforts to plan their investments.

Mr Ewing’s letter said:

As has been made very clear, Scottish Ministers have fundamental concerns about the EU withdrawal bill – as currently drafted, the Bill represents a ‘power grab’ reserving to Westminster responsibilities for matters currently covered by EU law in devolved areas which should properly rest at Holyrood after Brexit. These include agriculture, fishing and the environment. We are also clear that Scotland should receive its fair share of available UK funding across all schemes to be maintained in the future and that the power to determine how to invest that in rural priorities should be devolved.

I am therefore writing to seek written confirmation of the assurance you gave at that meeting, that the UK Government guarantee of funding to replace lost EU funding to the end of this UK Parliament covers funding for CAP Pillar 1 and CAP Pillar 2 in their entirety. You suggested that the guarantee would include all non-farm elements under Pillar 2, however, the Chief Secretary to the Treasury’s letter of 18 September to the Cabinet Secretary for Finance, Derek Mackay, discusses farm support only, with no mention of the non-farming elements. You can appreciate that this divergence is creating unhelpful confusion and why it is vital that we have a clear and comprehensive written statement on the extent of funding guarantees from the relevant policy Secretary.

You referred to a letter from George Eustice MP to Lord Teverson which, you said, explained the UK Government position, but it also only discusses farm support. The Scottish Government was not copied into that very short letter, but my officials were provided with a copy following its publication. It provides further demonstration of the lack of clarity and certainty which still exists in relation to funding guarantees.

As well as what is covered by the funding guarantee, it is also vital to establish what exactly the guarantees will cover in terms of their financial parameters. For example: if replacement funding is to be based on annual averages and not spending projections, then this will by definition leads to a risk of funding gaps for any elements for which spending was projected to grow during the course of the programme period. Moreover, it is essential that the funding guarantees cover not only payments made up to 2022, but also payments after that date under multi-annual agreements with land managers, without which it will be impossible for us to deliver forestry, environmental and other projects.

This continued lack of clarity from UK Government is already causing real problems for Scottish businesses in their efforts to plan their investments, as I have already explained to you in my letter of 14 September. It is therefore vital that Scottish businesses receive clarity on all aspects of rural funding – which includes forestry, farming, environment and communities. Further to my letter to you on Marine funding I would also welcome clarification as to whether the European Maritime and Fisheries Fund is included in the new guarantee to 2022.

You said in your letter of 28th September that you hoped our future engagement will be both constructive and positive. I would echo that. Clarity on the funding guarantees would certainly help us move forward and focus future discussions on the other critical implications of Brexit.

You also committed to sharing the forthcoming draft Fisheries and Agriculture Bills as soon as possible - I look forward to seeing these. As you will know the general approach to co-operation on these Bills, alongside consideration of the EU (Withdrawal) Bill, was discussed by the Deputy First Minister for Scotland and Minister for UK Negotiations on Scotland’s Place in Europe with First Secretary of State and Secretary of State for Scotland in their meeting on 25 September.

Finally I look forward to our meeting on resolution of CAP convergence monies.