Agriculture and Rural Communities (Scotland) Bill Islands Communities Impact Assessment

Step 1 – Develop a clear understanding of your objectives

The Scottish Government’s Vision for Agriculture, published in March 2022, outlines our long term vision to transform how we support farming and food production in Scotland to become a global leader in sustainable and regenerative agriculture.

After the UK withdrawal from the EU on 31 January 2020, our priority for agriculture and rural development was to provide stability and security for producers, land managers, and business. In 2020, the Agriculture (Retained EU Law and Data) (Scotland) Act was enacted to allow the Scottish Ministers to ensure that EU CAP (Common Agricultural Policy) payments and schemes would continue for a period of stability and simplicity after EU-exit.

In August 2022, the Scottish Government ran a public consultation titled ‘Delivering our Vision for Scottish Agriculture: Proposals for a new Agriculture Bill’. This consultation set out proposals to deliver the Scottish Government’s Vision for Agriculture. The Agriculture and Rural Communities (Scotland) Bill will aim to provide Scotland with a framework to deliver high quality food production, climate mitigation and adaptation, nature protection and restoration, and wider rural development.

The new Agriculture and Rural Communities (Scotland) Bill aims to provide the legal framework to deliver:

• the Scottish Government’s Vision for Agriculture;
• the National Performance Framework outcomes;
• Programme for Government and Bute House draft shared policy programme priorities;
• emissions and nature restoration targets;
• building on minimum regulatory standards;
• Just Transition which supports agriculture, land integration and land use change in a way that follows the Just Transition principles;
• value for money; and
• broad alignment to EU CAP objectives.

The primary purpose of this Bill is to (i) provide the Scottish Ministers with the necessary powers to manage and replace the current assimilated law Common Agricultural Policy framework for agriculture and land use support; and (ii) provide Scottish Ministers with the powers to deliver the Scottish Government’s Vision for Agriculture. It also provides the Scottish Ministers with powers to make provision for continuing professional development (CPD) for farmers, crofters, land managers and other persons, and to continue support for wider rural development.

Payments Framework

Currently Scottish Government utilises rolled-over powers under Retained EU Law (REUL) legislation to make support payments under legacy CAP schemes. In order to continue to be able to make appropriate support payments it is intended to take new powers under the Bill to make relevant support payments, which will remain broadly aligned with the new EU CAP.

The Bill is a framework bill, and creates the powers needed to enable the next generation of farm and rural support schemes. Detail of the schemes will be set out in (for example) secondary legislation, and will be subject to separate impact assessments as appropriate at that time.

The broadly framed enabling powers set out in the Bill will allow for continuation of support payments. These powers will also be flexible enough to allow for adaptation of that support in future in order to adapt to changing requirements, should Ministers choose to do so.

Food and Drink

The enabling powers in the Bill will provide for financial support to food and drink businesses for a range of specified purposes including in response to exceptional or unforeseen circumstances in the sector. Financial support will be available to all businesses including in island communities. This will have a positive impact on businesses and also the wider islands community through the potential for economic stability and growth, and jobs. Food and drink is an important contributor to the economy of the islands.

The geography of Scotland means that there is enormous diversity in how easy it is to produce or obtain food. The notion of a product being produced on an island has the potential to enhance its appeal to consumers, adding something special to its story. Of the 14 Scottish products protected under the EU protected names scheme, five are from our islands, demonstrating the importance of these areas to the Scottish food landscape.

Climate and Nature

Through the support framework, the Bill enables the Scottish Government to deliver towards the outcomes of climate mitigation, adaptation and nature restoration and ensure farming in Scotland can continue to produce our food more sustainably and that the land is managed more sustainably. This will support delivery of outcomes and strategies, including the Climate Change Plan, Scottish National Adaptation Plan and Biodiversity Strategy.

Payments Administration & Data

The broadly framed enabling powers set out in the Bill allow for the Scottish Ministers to make regulations about (1) administration and audit of payments made under the framework, and (2) the collection, processing and or sharing of data in connection with such payments.

These regulations and powers will enable the Scottish Ministers to enforce, monitor and evaluate progress to achieving the objectives of the bill and the Vision. Successful achievement of bill and Vision objectives should have a positive impact on the businesses who may benefit from support and in turn the powers should help enable the realisation of benefits to the wider islands community through this potential for economic stability and growth, and jobs.

Support for Rural Communities and Rural Networking

The broadly framed enabling powers set out in the Bill will allow for continuation of support to rural communities and for rural networking. These powers will also be flexible enough to allow for adaptation of that support in future in order to adapt to changing requirements, should Ministers choose to do so.

Animal Health, Welfare and Genetic Resources

The powers to provide support for the purposes set out in Parts 4 and 5 of the Schedule 1 allow for support in areas covered by the Islands (Scotland) Act 2018.

The Scottish Ministers would be able for example to provide continuing support for the Highlands and Islands Veterinary Services Scheme. This scheme ensures the provision of an adequate veterinary service for crofters and those of like economic status for the purpose of preventative or eradication measures with no cost disadvantage due to remote location.

The powers provided for in Part 4 of the Act would be applied equally on the Scottish islands as elsewhere due the necessity of maintaining a traceability system for the control of disease.

Plant Genetic Resources

The powers in the bill enable us to provide support for sources of plant genetic resources. When support is given, it will be based on the resource and have no impact on the location, therefore there is no impact in particular to the islands.

Access

The powers in the bill enable Ministers to provide support to assist with the provision of public access over land. Where support is given it will be based on local needs and requirements, which will take into account the particular needs of any islands communities, but will have no specific or particular impact on the islands.

Forestry

As the proposed powers within the Bill are to enable continuity of the existing Forestry Grant Scheme, so far as possible, it is not perceived to have a likely impact on Island communities. The Forestry Grant Scheme currently supports island communities by offering enhanced grant rates for the northern and western isles. Should significant changes to the existing grant scheme take place in future, appropriate impact assessments will be carried out to assess the potential impacts at that stage.

Knowledge, innovation, education and training

The Bill includes new powers in respect of training and personal development relating to agricultural, forestry, land management or related sectors. This is in addition to provision of other forms of learning and sharing information, including provision of advice. It also includes new powers relating to innovation and other research and development activities which may improve or support rural communities, rural land or land use. There is also power to support these activities through the development, use and maintenance of digital tools and resources.

In addition, the Bill provides the Scottish Ministers with powers to make provision for continuing professional development (CPD) for farmers, crofters, land managers and other persons.

Existing evidence

The Scottish Government’s Vision for Agriculture, published in March 2022, outlines our long-term vision to transform how we support farming and food production in Scotland, to become a global leader in sustainable and regenerative agriculture.

The powers in the Bill will support that Vision ensuring farming and food production in Scotland becomes a global leader in sustainable and regenerative agriculture.

Programmes made under the new powers will be taken forward under the Agricultural Reform Programme (ARP), which will consider the detail of policy implementation further as it progresses.

Table 1 presents an overview of current agricultural activity and the number of people working on agricultural holdings on the Islands from the 2023 Scottish Agricultural Census.

Our key stakeholders are the farming sector bodies and environmental sector bodies, given the biodiversity link. Some examples of our key stakeholders include the Scottish Crofting Federation, the National Sheep Association (Scotland), the Scottish Beef Association, NFUS, QMS, NatureScot, Scottish Rural College, Scottish Land and Estates, Soil Association, WWF. While some of the broader Climate Change stakeholders such as the Climate Change Committee, Stop Climate Chaos Scotland can be seen as stakeholders.

The types of farming activity on islands, such as crofting, are more small scale than large scale farming. The population make up is similar across the islands with 45-64 year olds making up the largest group in all islands, however, there has been a substantial percentage increase in 65-74 and 74+ age groups across all islands,^[3] and higher projected reductions in children and working age population in islands compared to mainland Scotland.^[4] Projected loss of working age population in the islands is therefore anticipated to be disproportionately higher than elsewhere. Some islands have seen net population growth, (Orkney Mainland and Connected Islands and the Highland Islands), whilst others (Arran, Bute and the Cumbraes and the Shetland Outer Isles) have declined in population.^[5] It should be noted that the characteristics of islands have similarities with some areas on the mainland (mostly Northwest/West and upland areas) and believe in general there is little difference between the islands and these areas of the mainland.

Island communities could be perceived to be more impacted by the bill (negatively or positively). Agriculture, forestry and fishing makes up 5% of the GVA of local authorities classified as islands, remote rural or mainly rural compared to 0.4% of local authorities classified as urban or urban with substantial rural.^[6] Percentage employment in this sector is also highest in remote rural areas at 15%, which includes the majority of island groups.^[7] Moreover, the impacts of climate change may be felt more strongly in island communities where more extreme weather conditions and rising sea levels may make islands more prone to coastal flooding, coastal erosion and reduced supplies of fresh drinking water.^[8]

A significant amount of crofting activity revolves around livestock production, and in many areas this is associated with low-intensity systems of high nature value. It is in these areas that we see a natural balance between food production and the environment, creating a rich diversity of wildlife habitats. The sensitive management of grasslands, field margins and moorland habitats, provides biodiversity and environmental benefits. This is particularly evident in some of our island areas, one example is the internationally renowned machair of the Uists. Crofting tenure brings additional benefits to our rural and island areas in terms of population retention, and can contribute towards food security and tourism/agri-tourism.

The current Less Favoured Area Support Scheme (LFASS) provides income support, considered to be essential, to farming businesses in remote and constrained rural areas. LFASS payments support land-based businesses and compensate for income foregone and for additional costs linked to natural constraints in order to encourage the use of agricultural land. This contributes to the maintenance of the countryside as well as to the maintenance and promotion of sustainable farming systems. It allows farmers and crofters to continue to operate as viable businesses and avoids the risk of land abandonment.

A commitment has been made to maintain direct payments to support active farming and food production in Scotland to ensure there will be no cliff edges in support. LFASS is expected to continue until 2026, however, consideration is still being given to how this type of support will be delivered from 2027 within the new Framework.

It is the intention that a replacement for LFASS must align with our Vision for Agriculture to ensure that farming, crofting and land management will continue to play an important role in maintaining thriving rural and island communities and those producing in areas of natural constraint are supported through the new Support Framework.