ARD Stakeholder Group minutes: September 2019

Attendees and apologies

Attendees

• John Kerr, Head of Agriculture Policy Division – SG (Chair)
• Claudia Rowse, SNH  
• Iain Muirhead, Agriculture Industries
• Jackie Green, Scottish Enterprise 
• Jackie Hughes, SASA, Scottish Government
• Jamie Farquhar, Confor             
• Jeremy Moody, Central Association of Agriculture Valuers 
• John Fyall, NSA
• John Raven, Historic Environment Scotland
• Keesje Avis, Nourish Scotland
• Keith Matthews, JHI
• Kirk Hunter, Dairy UK            
• Martin Morgan, SAMW 
• Megan Welford, Soil Association  
• Neil McCorkindale, SBA 
• Nina Clancy, RSABI
• Paul Flanagan, AHDB 
• Ross MacLeod, Game and Wildlife Conservation
• Steven Thomson, SRUC
• Vicki Swales, RSPB/SE Link
• Andrew Scott, Director for Sustainable Land Use and Rural Policy - SG
• Brian Stevenson, Deputy Director, RPID - SG 
• Eddie Turnbull, Head of ARE Information Services – SG 
• Joanna Storer, Rural Support Bill – SG   
• John Brownlee, Rural Support Bill – SG   
• Keith McWhinnie, CAP, GM & Agricultural Climate Change – SG
• Kirsten Beddows, CAP, GM & Agricultural Climate Change – SG
• Rachel Smith, CAP, GM & Agricultural Climate Change – SG
• Vicky Dunlop, Rural Support Bill – SG   

Apologies 

• Committee of Scottish Bankers
• Convention of Scottish Local Authorities
• Deer Farmers
• Highlands & Islands Agricultural Support Group
• Linking Environment and Farming (LEAF)
• NFUS
• QMS
• SAOS
• Scottish Tennant Farmers Association
• SOPA 

Items and actions

1. Introduction

1.1 John Kerr (JK) apologised for the duration of gap in between meetings.  He said that by delaying the July meeting, it put the Scottish Government (SG) in a better position to update members on a number of ongoing issues.  JK then introduced the new Director for the Directorate for Sustainable Land Use and Rural Policy, Andrew Scott. 

1.2 JK informed members that David Barnes had moved to a new post within SG dealing with constitutional matters in relation to Brexit.  He conveyed his thanks to David for his long term service to the ARD SHG and to the sector as a whole.  

2. Previous minute and actions

2.1 No comments on this from members.  All actions were completed.  

3. Brexit update

3.1 Andrew Scott (AS) introduced himself to members and provided an overview of his background.  He stated that Scotland now has the opportunity to think about the future in a different way, even if we remain in the EU the CAP is changing.  He added that there’s many elements of the new thinking; from the Agriculture Champions report, to the Council of Rural Advisors, the forthcoming material that the Farming and Food Production Future Policy Group will produce, the work of the Climate Change Committee – who reporting in October - and the work the Royal Society is doing around the work of living landscapes. 

3.2 AS explained that all these elements are going to come at the forefront of discourse in public policy.  Looking at it as a whole, the direction has been clear; it’s about biodiversity, efficient and secure food production, getting to net zero.  The challenge is turning it into a form of blended practical policy that’s informed by Science.  He added that there needs to be a collaborative approach to land management. 

3.4 AS told members that the task is to bring all elements together into a coherent, stable path to the future.  It will require a mutual agreement to be tolerant of each other to establish a collective way forward.  Scotland needs a long term commitment to outcomes to allow people to do what they do, but in a measured way.  Members endorsed AS comments. 

4. Convergence update

4.1 JK provided an update on the current convergence position and the recently published Intra-UK Agriculture Funding Allocations review report.  He reminded members that although the remit of the review focussed on allocating convergence funding in 2021 to 2022, it also highlighted the injustice of the UK Government’s decision, in 2013, not to allocate all the convergence money to Scotland.

4.2 JK informed members that Scotland’s strong case for fairer funding has been heard and that Lord Bew and the panel have found an equitable solution for 2020 to 2022.  This, coupled with the Chancellor of the Exchequer’s confirmation that UKG will be reimbursing the £160 million convergence money would mean a significant injection of funding.   JK stated that UKG had accepted the review’s recommendations which was that for the 2020-22 period, the convergence element of agriculture funding should be split according to the proportion of low per-hectare land in each part of the UK.  This means that Scotland will receive 63.7%, versus the current 16.3%.  

4.3 JK informed members that the report recommends that the notional convergence element of funding for the 2020-22 period should be based on the final year of EU funding which is a total of €127.6 million over the two years.  This means that Scotland will receive an uplift through convergence of around £50 million over the two years which is welcomed by the SG as more equitable.  

4.4 JK told members that the Prime Minister publically stated, and confirmed, that UKG will return the £160 million convergence funding to Scotland, so that it can be given to the recipients it was always intended for – Scottish farmers and crofters.  HM Treasury officials have advised that the money will be provided in the 2020-21 financial year.  SG is pushing to receive this money sooner and officials are working hard to consider how to get this money out to recipients as quickly as possible.  

4.6 JK thanked stakeholders - many of whom were in the room – for their input into the review and for their part in helping SG get to where we are today.  He also passed on Mr Ewing’s thanks, to everyone who has helped to make this a reality.  JK mentioned a particular thanks to Jim Walker, Scotland’s representative on the review panel for his excellent work.  He stated that it goes to show how Government working together with stakeholder support can make a real difference. 

4.7 Members commended SG and SRUC for their efforts and felt they had done an excellent job for the industry.  There was a discussion about how the £160 million should be allocated to the regions.  Some felt that the money should be going into regions 2 and 3 and to less favoured land.  On whether this money would be State Aid compliant, JK explained that SG believes that, as it should have always come to Scotland under the CAP, we are operating on that basis. Members hoped Mr Ewing would soon be in a position to set out the details of how the funding would be allocated and to whom.  

5. Rural Support Bill update

5.1 JK passed over to Vicky Dunlop (VD) who provided a short update on the Rural Support Bill.  VD informed members that the Bill will be needed in every Brexit scenario – apart from if we were not leaving the EU.  She explained that it’s an enabling Bill, essentially allowing Scottish Ministers to make changes in relation to the transition period under stability and simplicity and provides the necessary legal framework.  It covers what’s in the CAP, and doesn’t look at wider future work as SG have the Farming and Food Production Future Policy Group who are taking this area of work forward.  She explained that the UK Agriculture Bill does not affect Scotland’s Bill, but the Bill team is keeping track of how it’s progressing.  The intention is to introduce the Bill this year and to have gone through the various processes by late summer/early autumn of 2020, with secondary legislation being available from 2021.

5.2 Members asked what discussion SG has had regarding emergency funding and also if the money would be devolved so SG could decide how to spend it.  AS told members that UKG is considering what it can do, but have not made it clear what the purpose is.  One member added that Welsh Government and UKG are introducing a ewe headage payment.  KB added that support up to the value of £1000 of free advice is available through the Farm Advisory Service and that SG can send a link to members with more information.  Action for SG to send link. Update:  Action completed on 22/11. 

6. 2021-2024 work 

6.1 Kirsten Beddows (KB) provided an overview of how the 2021-2024 work is progressing.  She told members that this work is focusing on CAP schemes and how we use the enabling bill to deliver simplifications and improvements.  KB explained that if we have a no deal scenario, we revert to EU law – and the Rural Support Bill will allow Scotland to make changes from 2021.  Currently, internal group are looking at the different support schemes, what improvements could be made while ensuring they’re still deliverable.  That work is ongoing and the sub-groups are due to report to the overall co-ordination group shortly.  

6.2 KB stated that once we have Ministerial clearance then SG will bring proposals to stakeholders.  The remit and minutes will be available on the SG website.  SG will be taking proposals to Ministers later this year and hopes to be able to share proposals with stakeholders by the end of the year.  Some members felt they weren’t consulted in the process - to which KB reminded them that the remit stability and simplicity and we would share information once we were in a position to do so. 

7. Farming and Food Production Future Policy Group

7.1 In the absence of David Balharry, JK provided an update on this group.  He said that it had met once so far and is made up of individuals with experience of different aspects of farming and food production in Scotland, together with SG officials.  The remit of the group is to develop policy recommendations to benefit Farming and Food Production in Scotland post 2024; (https://www.gov.scot/groups/farming-and-food-production-group/) JK also informed members that there’s an academic group to support the group which has met twice.  He added that the group has an opportunity to inform proposed pilots on new schemes for the wider rural economy, and the work is being overseen by the Sustainable Land Use and Rural Policy Directorate within SG with an emphasis on openness and innovation.

7.2 JK said it had been a productive first meeting and outlined what the group would be focusing on going forward, such as; setting out what a vision for Farming and Food Production looks like for 2024-2030 and how it integrates with the wider rural economy in different parts of Scotland; developing a Communication and Engagement Strategy; highlighting options on how future land-use can best contribute to the climate change emergency; providing a series of case studies, the challenges they face, their viability and contribution to sustainable land-use; setting out the requirements of different government policies and strategies; and filling evidence gaps and bringing best practises from around the world to the table.  The group would meet monthly until December 2019. 

8. Climate Change Bill

8.1 Keith McWhinnie (KM) provided an overview of the current position.  He said that following the First Minister’s (FM) declaration of a climate change (CC) emergency, advice from the committee on CC was received by Scottish Ministers.  The committee stated net zero for Scotland is achievable by 2045.  Scottish Ministers accepted this advice and sought to amend the CC Bill that’s currently before Parliament.  The CC Bill was brought forward to increase the targets Scotland has domestically under the 2009 CC Scotland Act.  The Bill will see the targets increase from 80% by 2050 to net zero by 2045.

8.2 KM told members that the Bill was in stage three and contains a number of amendments in relation to; nitrogen, an agricultural support fund and an amendment for SG to set out CC plans to take account of an inventory.  There’s also a commitment that an updated CC Plan will be produced within six months of the Bill receiving Royal Assent.  CC has been placed at the heart of the Scottish Government’s Programme for Government (PfG) and imagines it will be for future years.  Other commitments include looking at Scotland’s rural land as a whole, improvements to biodiversity and water quality.  This isn’t looking to reduce greenhouse gasses at the expense of something else – this is to reduce these in tandem. 

9. Pillar 1 and Pillar 2 updates 

9.1 Brian Stevenson (BS) provided an update on current CAP payments.  He stated that in December 2018, SG published the 2018 CAP payment strategy setting out when payments would be made for each of our Pillar 1 and 2 schemes.  He informed members that RPID was on track to meeting those targets.  By 30 June 2019 SG had already achieved all of the 2018 Pillar 1 scheme and LFASS payment targets.  For LFASS, that is six months faster than for 2017 applications.  RPID were well on their way to meeting all of the Pillar 2 scheme targets.  

9.2 BS said that RPID colleagues have continued to work on the small number of remaining applications since these targets were achieved and have now have paid 99.6% of Pillar 1.  RPID are well over the final threshold that we need to achieve of 98% paid by the end of August 2019.  This is two and half months ahead of the EU target.  BS told the group, that in total, SG has paid over £551 million to Scottish farmers for all 2018 schemes, which is an improvement of £25 million compared to this time last year.  

9.3 The National Basic Payment Loan is in place again, this should help with the impact of the ongoing uncertainty of Brexit.  SG is still working through eligibility criteria such as Young Farmers and whether applicants have debt with RPID but 95% of loans have been paid.  

10. Simplification taskforce

10.1 Eddie Turnbull (ET) provide an update on the Simplification Taskforce.  He stated that good progress has been made, with ideas gathered from external panel members, staff and output from the consultation on stability and simplicity. The landscape has changed since the Simplification Taskforce was first set up and there are now two further groups taking a lead in the period post 2020.  These are the 2021-2024 Policy/Delivery Coordination Group, and Farming and Food Production Future Policy Group for post 2024. 

10.2 ET informed members that the majority of ideas from the various avenues will feed into these post 2020 policy groups whilst the Simplification Task Force itself focused on what can be achieved within legislative constraint in the period up to the end of 2020.  There are a number of themes emerging from the various suggestions that will be considered. 

10.3 ET set out the next steps.  SG has enacted some changes in reaction to the ideas and feedback it has gathered from stakeholders, including ARD SHG members, but more work is required to detail out the business impact analysis on some suggestions that have more wide reaching consequences such as an inspection charter, a yellow card system for all inspections and so forth.  A full report on the Simplification Taskforce output will be prepared for issue later this year. 

11. SLE published strategy 

11.1 Eleanor Kay (EK) updated members on SLE’s strategy – Route2050 which builds on their 2017 strategy and sets out a direction for travel for Scottish land management to 2050.  SLE felt they needed something to reopen the conversation.  SLE’s vision remains that they want to see productive land-based businesses contributing to vibrant rural economies whilst protecting and enhancing the environment.  For more information, please see published strategy: https://www.scottishlandandestates.co.uk/sites/default/files/inline-files/%23Route2050_FINAL_Sept%202019_2.pdf 

12. RSPB published policy document 

12.1 Vicki Swales (VS) provided an overview of Paying for public goods from land management: How much will it cost and how might we pay?  She stated that in 2017, RSPB, the National Trust and The Wildlife Trusts commissioned an assessment to be conducted looking at of the costs of meeting environmental land management priorities in the UK.  The work involved building an MS Excel spreadsheet model, which estimated the land management actions required to meet a range of defined environmental priorities (including for biodiversity/ ecosystems, soil, water, landscape and the historic environment), and estimating the costs of delivering these actions using appropriate unit cost estimates.  For more information, please see published strategy: https://www.wildlifetrusts.org/sites/default/files/2019-09/Paying%20for%20public%20goods%20final%20report.pdf

12.1 JK thanked EK and VS and offered for other members were to do this at future meetings.

13. AOB:

13.1 One member added under AOB that Defra have put out a consultation around Sheep Aid that only absorbed England and Wales comments.  Wants to know if colleagues in animal health and welfare were aware of the consultation and if they had fed into it. Action for SG to confirm with AHW colleagues.

13.2 The next ARD SHG meeting will be held on 26 November.