Sustainable and integrated farming and crofting activity in the hills and uplands of Scotland: blueprint - report

7. Woodland creation and management

The HUCG recognises that soils are our largest carbon store but are currently a net source of carbon. Peatlands and peaty soils comprise over fifty per cent of agricultural soils and are associated with current net emissions of approximately 9Mt of carbon per year. Consequently, the restoration and maintenance of (degraded) soils and peatlands is a priority for the hill, upland and crofting sector given that this is where the majority of peatlands are found. However, we cannot achieve net-zero emissions targets through emission reduction practices alone and carbon capture is therefore an essential part of the solution, particularly through increasing biomass in a way that does not prevent soils from becoming a net carbon sink.

The group also recognises that the right tree in the right place can offer a wide range of environmental benefits including biodiversity enhancement, improved water quality, flood management and an alternative source of income and employment. Within an agricultural management context, trees can offer important shelter for livestock grazing on exposed upland and hill areas, provide shade during hot spells and shelter from poorer weather conditions, break winds to reduce topsoil erosion and crop damage, and trees and hedges along field margins can act as a natural barrier to prevent physical contact between different livestock groups, thereby improving biosecurity.

The group therefore supports the general concept of integrating trees into current land uses across Scotland but only where this is done with due consideration of wider land use integration, landscape function, ecosystem and natural capital services, rural communities and industries, and the critical mass required to sustain rural economies and their upstream and downstream subsidiary industries.

The HUCG would like to see more integrated agro-forestry initiatives being made available to land managers to enable farmers and crofters to integrate forestry within their existing business, and therefore recommends that a review of all future support for the hill, upland and crofting sector be carried out to better recognise the role that this sector can play to help increase total woodland cover without compromising agricultural activity, sustainability and production levels, soil carbon stores (particularly on peaty soils), and the biodiversity benefits that this sector supports.

The review should consider the following aspects in particular:

• Silvo-arable and silvo-pastoral woodland can typically involve much smaller coupes of trees than standard forestry or woodland practice where silviculture is the primary purpose. Woodland blocks smaller than the 10 to 50 hectare limits used in current farm woodland schemes should be considered. If the lower limit could be reduced, this may make schemes more attractive to businesses seeking to establish small areas of woodland. For example, this may refer to woodlands being integrated with grazed pasture to provide important shelter and to increase diversity of habitats for wildlife. The cumulative effect of many such smaller projects may contribute significantly not only to the success of initiatives such as the 'Sheep and Trees' initiative, but it would help to support and positively engage more farmers and crofters whilst contributing towards Scottish Government's woodland targets.
• The 'Sheep and Trees' scheme eligibility appears to currently be restricted to productive conifer only, presumably as the initiative intends to provide support for a forestry crop which has a commercial value in timber. Spruce shelter belts in particular can be difficult to manage, have a limited lifespan as useful shelter for livestock, do not enhance wildlife habitats and can be poor for connectivity purposes. The HUCG would therefore like to see opportunities whereby funding for integrated forestry can be obtained for native mixed/broadleaf planting and/or natural regeneration not intended for the commercial market, i.e. for longer-term carbon sequestration, livestock and arable shelter, and soil enhancement purposes with added biodiversity benefits arising from the use of native diverse and/or broadleaf type woodland.

The HUCG notes that the Forestry Grant Scheme includes the already mentioned 'Sheep and Trees Initiative' which provides access to government funding for hill and upland sheep farmers and crofters to introduce trees as a new crop alongside a sheep enterprise without the need to reduce the flock size. This initiative offers an important first step towards the delivery of multiple beneficial outcomes from integrated land use where forestry and agriculture can be managed symbiotically. Anecdotal evidence suggests however that uptake to date has been rather poor which may be a result of the initiative not being well known and because of difficulties to access relevant advice, support and information.

The HUCG would like to highlight that whilst the 'Sheep and Trees' initiative is a move in the right direction, the concept of agro-forestry type initiatives and smaller schemes should not be reviewed and continued as separate programmes. Instead, publicly funded woodland and forestry schemes must be reviewed as a whole and be opened up more broadly to facilitate greater land use integration across different types of Estates, farms and crofts by offering opportunities for a diverse range of sustainably and sensitively planned woodlands. If this is not done, Scottish Government's ambitious woodland targets simply cannot be achieved without sacrificing many upland and hill farms. The current perceived conflict between trees and sheep (or livestock in general) must be resolved given that there are already excellent examples in Scotland where integrated agro-forestry is managed in a mutually beneficial manner.

The HUCG therefore recommends that consideration be given to the following proposals in an attempt to ensure that the multiple potential benefits from forestry and woodland can be realised without the risk of unintended socio-economic consequences or other negative impacts on the climate and wider environment:

• The issue surrounding the agricultural tenanted sector must begiven more attention within wider policy considerations but particularly within the context of Scotland's ambitious woodland targets to ensure that government grant schemes do not (further) stifle trust and opportunities within the tenanted sector. Current policy surrounding woodland schemes along with the ability to access significant government grant funding for woodland projects makes it very attractive for landowners to take land back in hand which is severely impacting on an already struggling tenanted sector and any new entrants wishing to enter the industry. There is a perception within the industry that a strong focus on meeting forestry creation targets in particular is being prioritised over other land uses as well as integration of multiple land uses to the extent that the implications for the agricultural sector in terms of sector viability and opportunities for new entrants and tenant farmers appear to be either disregarded or accepted as justifiable collateral damage. The group stresses that this is a perception and not necessarily a fact, but the (unintended) consequences are already significant and will only increase as the longer-term impacts are beginning to emerge over the coming years. There is great concern that the full extent of any damage being caused by such absolute policy approaches will only be fully recognised when it may be too late to reverse it. The HUCG stresses that it is not opposed to woodland creation, but it does not support one-dimensional approaches to land use and land use changes where this is to the detriment of existing land uses, particularly when these are already delivering important public benefits. A solution will likely only be achieved by outlining collaborative options that are mutually beneficial for both parties in terms of both payments received and liabilities held, but it is crucial that schemes are designed in such a way that encourages collaboration and active engagement with a tenant farmer or crofter. This requires some form of commitment to follow-up management of a publicly funded asset. The HUCG therefore recommends that a wider review of the implications of different policy targets, scheme structures and funding levels for a range of different land uses on the agricultural tenanted sector is carried out to identify ways in which any negative implications and potential unintended consequences can be minimised whilst attempting to reinstate and maintain a vibrant tenanted sector.
• The HUCG notes that there is already a process in place via the local authority's indicative forestry strategies which form part of local statutory development plans, and which provides an opportunity to provide inputs within the context of other land uses. The HUCG also notes that the Scottish Government has recently set up the first of several Regional Land Use Partnerships (RLUPs), and that it is the intention of these RLUP proposals to pilot ways of broadening the way in which land use decisions are made at regional scale. The HUCG broadly supports the intended direction of travel and stresses that forestry planning should form part of a wider sustainable farmland and natural capital review to ensure that different local and landscape priorities and interests are adequately balanced.
• Primary policy focus ought to be on properly managing, maintaining and, where possible and suitable, enhancing existing woodlands in order to ensure that they are healthy and functioning ecosystems capable not only of sequestering and storing adequate quantities of atmospheric carbon, but also of delivering a much wider range of distinct biodiversity, amenity and public wellbeing benefits. Within this context, priority should be given to native woodlands over commercial plantations. The HUCG appreciates that there are economic interests attached to commercial plantations and stresses that it is not opposed to the creation of forestry for timber production purposes, but it strongly believes that what is already there, including many native woodlands, natural regeneration and pockets of woodland and scrub of conservation value, must first be managed properly before resources can be dedicated to the creation of new woodlands.
• Where natural regeneration is likely to succeed, greater emphasis should be put on encouraging natural regeneration of native woodland over non-native planted woodland as a means to minimise soil disturbance and protect soil carbon stocks whilst also maintaining a field layer which would otherwise be lost as a result of conventional plantation models. The additional benefits that can be delivered via natural regeneration should always be reflected in grant payment rates.
• Given the ambitious woodland creation targets outlined by Scottish Government, agro-forestry and other integrated forestry approaches should be better promoted, incentivised and prioritised to ensure that the national targets can be met without having to undergo major land use restructuration at the cost of other industries when a symbiotic approach can facilitate woodland creation without compromising existing land uses and services. In order to achieve this, the concept of and requirements for agro-forestry projects should be reviewed to ensure that they are relevant and practical to Scottish systems, and can be easily integrated on tenanted farms and crofts.
• The HUCG recognises that market price difference plays a fundamental role in the bottom-line profitability of a specific enterprise or land use but stresses that public funding as a means of providing investment and income support should be set at a level that reflects the likely profitability of a venture or shortfall of income. Although there are obvious challenges associated with the fact that market prices can fluctuate quite significantly, the likely market value has to be captured and considered when setting payment rates for public funding as a means to provide investment and support income. If support payments in addition to market income cause significant differences in the likely profitability (per hectare) that can be generated from different land uses, this can severely distort and artificially inflate land values which can have a detrimental impact for agriculture, particularly the tenanted sector and new entrants, as well as for forestry projects aimed at ecosystem services. Woodland grants should therefore not be pitched at a higher level than agricultural support payments unless such woodland support is made conditional on the woodland design delivering a greater range of public benefits which can for instance be delivered by silvo-agricultural systems over monocultural systems. Within this context, the HUCG recommends that payment rates for forestry and woodland grants, particularly for large-scale commercial woodland plantations, should be reviewed and that regular reviews of forestry grants more generally should be aligned with those taking place within the agricultural sector to ensure that support payments for forestry creation do not generate notably higher profitability than can be obtained through farming activity and agricultural income support, especially within the context of good agricultural activity delivering wider ecosystem benefits. Otherwise, this enables commercial woodland investors to outcompete the financial viability of alternative land uses that are being put at a competitive disadvantage as a result.
• Consideration should be given to offering higher payment rates for woodland schemes which propose the integration of diverse native species with agricultural land use through natural regeneration and where the main objectives are environmental and biodiversity enhancement without commercial use, whilst lower grant payments should be offered for commercial plantations where the applicant intends to manage the woodland for economic reasons with the ability to derive an income from timber. Having said that, there are also clear benefits of using native woodland for commercial purposes and this should also be reflected within payment rates to encourage the use of suitable species such as Birch.
• The establishment of forestry through plantation on peatlands of any depth (including shallow peatland) should not be permitted in order to protect the one soil type and terrestrial habitat that holds the largest soil carbon stocks and has the greatest below-ground potential to sequester additional soil carbon longer-term.
• The establishment of forestry on peaty and otherwise carbon-rich soils (other than peatlands, although very shallow peatlands could be considered) should only be permitted where this is done through natural regeneration in order to leave the soil undisturbed and preserve soil carbon stocks. Consideration should be given to restricting this option to non-commercial woodlands where the intention is to deliver ecosystem benefits rather than to harvest timber so as not to disturb carbon-rich soils during harvest and replanting.
• Where a commercial conifer woodland has been planted in the past and the owner wishes to replace it with native, broad-leaf and/or a mixed species for long-term retention in order to enhance its biodiversity value, consideration may need to be given to offering some funding to encourage such projects. This should also apply to situations where the responsible party may wish to cut down an older woodland which was planted on peatland before the negative implications of doing so became fully understood, although the latter may possibly need to be funded as part of a peatland restoration and management budget.
• The establishment of forestry in such a way that it alters an existing (permanent) habitat on a site to the detriment of existing key animal and plant species or sensitive local habitats should not be permitted. The HUCG notes that forestry and woodland grant schemes already impose a rigorous environmental impact assessment process on the applicant before a grant is awarded, and that this assessment includes the collation of data of priority species and habitat coverage. However, this can currently only be done at individual land holding scale as biodiversity data is not (yet) collected at this scale on a national basis. The HUCG stresses that habitats and biodiversity require protection and management not only at local but also at landscape scale as the concept of ecological connectivity can play an important role in supporting key populations. A Scottish Biodiversity Priority Map should therefore be established using data from the Scottish Biodiversity Strategy on the occurrence of vulnerable / endangered species and/or their habitats in conjunction with data collated from farm-level biodiversity auditing which, as previously discussed, has been proposed as a baseline requirement for future agricultural support schemes. This data should be used to better determine the likely impact that a proposed woodland or forestry project may have on existing habitats, and is of particular importance within regions which support wader and other ground-nesting bird populations as wooded areas can create ideal conditions for predators of these birds.
• The application process to obtain funding for smaller and integrated forestry projects including smaller scale on-farm woodlands, wildlife corridors, shelter belts, field margin tree lines and agroforestry needs to be simplified for all applicants and be made more accessible for tenants. This could potentially be achieved by making a non-competitive grant pot available for each unit for such smaller-scale woodland (similarly to the concept of the old Land Manager's Options – LMO). If this were to be considered as a viable option, then siting of such woodlands would likely need to be subject to an audit to identify the opportunities for such projects, and in order to achieve the necessary scale and impact at a national level this may require the inclusion of some compulsory elements. The HUCG recommends that consideration be given to using the previously mentioned baseline biodiversity audit as basis for the above approach if this is deemed a worthwhile recommendation. In order to support tenant farmers and crofters, it may also be worth considering to put the onus on the landowner to block an application for a small woodland project rather than on the tenant by having to seek approval from the landowner.
• If a woodland that has been established with public funding has failed during establishment or at any point thereafter, including at the point when it is being replanted after harvest, or shows signs of being in poor condition as a result of inadequate or absent maintenance and management, there should be an obligation on the recipient of the grant (or the individual/business that has since taken over the liability) to have to resolve these issues at their own cost or else repay the grant money. This obligation should be extended to situations where the recipient of carbon credits may have to pay a carbon tax if they have failed to prevent or resolve issues other than those caused through force majeure. The HUCG notes that this recommendation already forms a condition of grant as part of the forestry grant scheme, and that woodland developers that sell carbon credits via the woodland carbon code have to adhere to strict regulatory conditions to safeguard the carbon investor's investment. However, the HUCG wishes to highlight that there appears to be some anecdotal evidence to suggest that a breach of the conditions that are attached to such funding streams is perhaps not always followed through where there is a case of a failed woodland. The HUCG therefore strongly recommends that the current process of monitoring longer-term compliance with funding requirements should be reviewed to ensure that investments are monitored properly and that action is taken where needed in order to generate the necessary public benefits.
• The approval of grant for a commercial woodland should have to be considered within the context of wider and regularly updated land use strategies that are already embedded within local authority plans but which are in many cases outdated with regards to recent emphasis that is being increasingly put on climate change and land use change. There is a need for such land use strategies to be developed at appropriate scale so that competing land use priorities can be rationalised. The previously mentioned Regional Land Use Partnership pilots may offer an ideal opportunity to facilitate a more holistic approach to different and integrated land uses where different interests and industries including the farming sector can engage. This is not only relevant within the context of climate change and environmental enhancement but must also consider the socio-economic profile of local rural communities and industries and the critical mass required to sustain these. It will be important to identify and highlight areas of Scotland where the critical mass of farmers and crofters or rural communities more generally is at risk of being compromised by woodland plantations and where integrated land uses should be pursued instead. Therefore, consideration may also need to be given to potentially introducing an upper limit on the size of woodland that can be planted in one place, i.e. as one forestry unit (regardless of whether established at the same time or in several stages), as well as an upper limit on the proportion of the total area of a farm and possibly a county and parish that can be planted.
• Recognising the distinct benefits of patchwork landscapes and landscape-scale ecological connectivity, consideration should be given to introducing a requirement that every land owner or manager (claiming some form of government support) has to establish wildlife corridors using, where appropriate and not detrimental to key species, agro-forestry, silvo-pasture, small-scale native on-farm woodlands, tree lines or hedges along field margins on a certain proportion of their total land area. This should be done using diverse native species that are sympathetic to the local biodiversity and ecosystem and, where possible, the focus should be on natural regeneration rather than via plantation so as to minimise soil disturbance and the associated soil carbon losses. Such engagement at scale could deliver quite significant outcomes even if the individual contribution consists of predominantly small-scale projects, and should be planned for and prioritised through the biodiversity audit approach mentioned earlier on.
• Site surveys in support of applications for planted woodland projects must be done with greater accuracy than is currently the case and on the basis of newly emerging evidence in order to minimise the risk of attempting woodland plantation on sites which naturally are not able to support woodland, thereby resulting in a failed woodland scheme along with significant soil carbon losses from site preparation. The HUCG notes that such surveys already form an important part of the process involved in woodland planning, but there appears to be some anecdotal evidence which suggests that these surveys are perhaps not always carried out to reach the correct conclusions.
• The HUCG believes that the integration of woodland onto an agricultural holding should be recognised within the agricultural emissions envelope as an effort undertaking by said holding to reduce its own net emissions.