New Deal for Agriculture - NFUS: First Minister's speech - 7 February 2025
- Published
- 11 February 2025
- From
- First Minister
- Delivered by
- First Minister John Swinney
- Location
- Glasgow
First Minister John Swinney's speech about improving agricultural support, given at the NFU Scotland AGM in Glasgow, on Friday 7 February 2025.
Mr President, it's a great privilege to be with you this morning and I can relate very directly to how your President feels this morning.
About nine months ago, I thought I was preparing for a quieter life. And I now find myself busier than I've ever been at any moment in my life.
So I suppose the moral of the story is that you don't know what lies around the corner and but it is a great privilege to hold office as First Minister. And I wish you, Andrew, all good wishes in holding office as President of National Farmers Union.
It's a great opportunity for me to be with you this morning to set out, first of all, the importance I attach to the role of agriculture in our country and also to set out the way in which the government, under my leadership, will take forward our relationship with the agricultural community in Scotland.
But before I do that, I want to take this opportunity to express my thanks as First Minister, on behalf of the Scottish Government, to your outgoing President, Martin Kennedy, for the tireless work that he's taken forward on behalf of National Farmers Union across Scotland in recent years.
Martin, of course, is one of my constituents and I've had the privilege – well I'll leave it to you to judge whether it's a privilege – of benefiting from his counsel over many years and his perspective in our local discussions in Highland Perthshire.
Since I became First Minister last May, we've had a number of opportunities to develop that dialogue and only in the last few weeks I had the opportunity to visit Lurgan Farm to meet with the NFUS board and to discuss many of the current and significant issues that affect agriculture and Scotland
And of course the benefit of visiting Lurgan is that you probably get the opportunity to scan one of the finest landscapes in Scotland in the landscape over Strathtay.
Over the length of his term, Martin has travelled the length and breadth of Scotland to listen, discuss and to find solutions to key issues, as well as making frequent visits to Holyrood, Westminster and Brussels to make sure there is a strong voice for Scottish agriculture.
And Martin's optimism and pragmatism undoubtedly has been a huge asset to the sector and has meant the Scottish Government has had access to a well informed source of counsel to help us find the right solutions.
So Martin leaves behind a tremendously positive legacy for your new presidential team, and I express my warmest thanks to Martin for his leadership and for his service. And I extend a very warm welcome to the new presidential team and my ministerial team will work closely with Andrew, with Robert and with Duncan to make sure that we understand, with care, the aspirations and the concerns and the considerations of the agricultural sector in Scotland.
I've had the privilege of representing a rural constituency for over a quarter of a century. The first question I ever asked in the House of Commons, the first question I ever asked off the then Prime Minister Tony Blair on the very first occasion that he answered questions as Prime Minister in the House of Commons in 1997, was about agriculture.
I've seen it first hand, the positive impact of careful stewardship of the land throughout my constituency, and I've seen how farmers have navigated huge challenges through some incredibly challenging and difficult years.
All of that experience and perspective rest with me when I sit around the cabinet table and when I exercise my responsibilities as First Minister.
In short, I want to assure you that you've got a First Minister who, in representing a farming constituency, understands the importance of farming to the rural economy and who's determined to ensure there is a sustainable and prosperous future for farming in Scotland
The approach of my government is to listen and to lead. We'll listen to the industry as I did at AgriScot a few months ago, as I did at Lurgan Farm the other week and having listened, we will provide the leadership to take the country and the industry forward, in partnership.
I recognise that farming can be tough, both physically and mentally. The recent storm Eowyn reinforced that to me.
In the aftermath of the storm, I was reminded of the central role that many in the farming community play in the resilience of rural communities, playing a key part in the clear up operations and in helping vulnerable residents to be able to recover from the impact of the storm.
We also know that many farmers struggle with their mental well-being, the range of pressures, the isolation and the long working hours can take her toll. So I want to applaud today the work of organisations such as RSABI, who have a crucial role to play in providing, in many cases life saving, support within the farming sector.
That's why in this financial year, we've provided funding of £75,000, bring your total support to over £600,000 and we're currently in discussions with both RSABI and Farmstrong on supporting their vital work in the next financial year because I recognise the centrality of that to supporting the farming community within Scotland today.
And farming is tough because of the context in which you are operating today as well.
The combination of the change that has come that has come from Brexit coupled to the growing and more visible implications of climate change create a set of conditions that are incredibly challenging.
Not many politicians want to talk about Brexit, but I believe it's important to tell it as it is. Brexit has been a disaster for the United Kingdom.
It's reduced the size of our economy, it's reduced the tax revenues available to the United Kingdom government.
It's reduced the availability of labour and it's constrained trade opportunities and has injected enormous financial uncertainty into the farming industry.
I recognise it was a good thing that farmers had seven-year funding certainty from the common agricultural policy. It enabled you to properly plan your investments to enable you to manage the peaks and the troughs of weather conditions and to navigate your way safely through challenging and changing market conditions.
In recognising the advantages of long term certainty, I want to get to a position where we can offer as much certainty as we can in the new arrangements.
We expect the United Kingdom Government to provide us with up to three years of funding information in the forthcoming spending review. That would be welcome, and if we secure that clarity, we will deliver a comparable multiyear settlement for farming on an indicative basis, based on the information provided by the United Kingdom government
In the short term, we provided a budget settlement of over £660 million, passing on in full the money we have received for agriculture from the United Kingdom Government.
But we all know that the way that the budget settlement has been baselined into the Scottish Government's budget is inadequate.
The approach of the UK government is to update the agricultural component of the Scottish budget in line with the Barnett Formula, a population based formula that is generally said that about 9% variation in budget provision, ignoring the fact that Scotland's land area saw us receive 17% of the budget allocation to the United Kingdom when we were members of the European Union.
Now we need to work together, government and industry, to secure a change of direction on agriculture funding from the UK Government so that this anomaly is sorted out.
We need to work together to make sure the UK Government hears the voice of Scotland and Scottish agriculture pressing for a settlement that works for Scotland.
And my government will take forward sustained efforts to engage with the United Kingdom government in urgent and meaningful discussions on these crucial issues, and these issues have been pursued not just by my Rural Affairs and Agricultural ministers, but also by my Finance Minister, to make sure that we can deliver the progress on these crucial issues and on the need for an appropriate multi-annual budget settlement for agriculture and your support and engagement in these efforts would be greatly valued by the Scottish Government.
And you can rely on the support of the Scottish Government in relation to the UK Government's recent changes to inheritance tax relief, which I know is creating widespread concern within the industry.
The sweeping changes, which the UK government has introduced without any consultation with the farming community or with the devolved governments, only add to the pressures that you are facing.
They are the cause off real anxiety and you are right to be outraged and I share your concern about these changes.
Let me be absolutely crystal clear, the Scottish Government stands united with you in opposition to these changes. The impacts are likely to be widespread.
Independent analysis recently published suggested that more than 75% of English and Scottish farms, over 50 hectares will be affected by the inheritance tax change.
Like you I'm particularly concerned about the impact on Scottish tenant farms, with some at risk of being caught up in the tax change. And as we know, Scot's law on agricultural leases is different from the law south of the border and it's far from clear that the Treasury understood that significant distinction when this particular change was being brought about.
So it's important that we stand with one clear voice about the fact that the circumstances in Scotland, which are so affected by the nature of the legal framework in which we operated, are properly understood and also that the essential requirement for there to be a tax set of arrangements in place, that will enable farms to be transferred from generation to generation, in the way that they have been able to do up until now, is respected and reflected in the arrangements that are put in place and they are not reflected in the current arrangements that we have before us.
So we have work to do together to make an impact on the treasury in their thinking on this particular issue.
Now we live in a world of increasing uncertainty. The challenge and burdens that you face with extreme weather, energy costs, Brexit-related trade barriers and supply chain costs are severe. And I'm determined that my government is seen as a source of solutions, rather than yet another cause of problems.
That includes our clear and firm commitment to continuing direct payments to the farming sector. The agriculture and Rural Communities Scotland Act provides the government with the powers to implement the new framework for agricultural support.
The routemap sets out what the journey will look like, when you when you can expect to see changes and how to get more information.
Last year we announced that 70% of funding would be allocated to Tiers 1 and 2. And I confirm that that remains the case.
I can also announce today that we intend to apply a funding split of 70/ 30 between Tiers of 1 and 2. We believe those commitments represent an investment which will reap rich rewards for our wider economy.
It represents an appropriate balance between relevant factors – underpinning our world class food and drink sector, maintaining our beautiful countryside, supporting emissions reductions and, crucially, keeping people on the land.
We will continue to provide strong support through the range of current and future schemes in recognition of the crucial role that agriculture plays in sustainable food production, delivery of climate and biodiversity actions and also in underpinning, thriving rural communities.
Supporting the fresh produce sector in Scotland is important to our food security and we recognise the challenges the sector faces, so I'm pleased to confirm today that the government will continue to support the fruit and vegetable aid scheme in Scotland.
As we wrestle with day-to-day issues, the future is impossible to predict, but it is possible to shape and I've no doubt that if we work together as a nation, if we choose to put our collective efforts and energies behind clear national goals, then better days lie ahead of us.
We have the opportunity with the right choices to build a more sustainable rural economy, built on the foundation of a strong and thriving agricultural sector.
A flourishing Scotland means a flourishing rural Scotland for me. And for rural Scotland to thrive, farming must thrive. That's my ambition.
And for as long as I remain First Minister, you've my commitment to work with the industry, and with the wider food and drink sector, to maximise your success to maximise our nation's success into the bargain.
The inflation shock that hit the public finances after Russia's invasion of Ukraine meant that we needed to take some tough budgetary decisions. That included, as you know, a decision to reduce the money available for farming, with the promise that the shortfall would be restored.
It was not a decision that we wanted to make, but it's one that we had to take and I'm grateful to the sector for your cooperation and appreciation of the difficulties that we faced.
As announced in the recent budget, £20 million will be restored this year for additional capital support in making good that commitment to restore that funding to the agricultural budget.
And I can confirm that you will see the remaining £26 million in the budget for the following financial year.
I want to see a farming sector that is equipped and ready to meet the challenges and seize the opportunities of the future. That's why at least £14 million of the funding will be delivered through our Future Farming Investment Scheme.
This investment in the sector offers something new for Scottish agriculture – flexible capital grants. You know your business and you know your land.
We will not be prescriptive in what investments you make. As long as the funds are used to drive efficiency, or support nature and climate friendly farming, your bids will be valid and could receive support.
We will work at pace to consult with stakeholders to ensure the capital grants scheme guidance and the priorities work for a range of businesses and that the application processes are simple and straightforward.
In addition to this, we will also deliver capital funding to support our food and drink processing sector. A growing food and drink industry is central to our plans.
And of course, also central to our plans is the fact that no future for farming can be complete without new entrants into the industry.
Young farmers and new entrants to agriculture are absolutely essential. As a government, we want to do more to support new entrants and, although the issues are complex, we have to work our way through the issues to identify answers.
Government alone does not have all those answers and this is an area where we will need collaboration and your collective wise counsel to help us design approaches that are meaningful on the ground. And I heard these aspirations at the discussion we had with the NFUS at Lurgan a few weeks ago.
That's why I've asked Marie Gougeon to convene urgent discussions on an approach to new entrants so that together we can use the additional new capital resources available to farming to design an approach that will be satisfactory in securing that policy objective.
In so many ways, Scotland's farmers and crofters are proud stewards of our landscapes and habitats. We've got to make sure that crofting is seen as an essential and valued part of Scottish agriculture.
It is part of the very essence of the Highlands and Islands and I want to get the measures in our proposed Crofting Reform Bill correct, so we'll be listening closely to the views of crofting communities in that process, and I want our agricultural policies to support our active and productive crofters, and that's my promise to the sector today.
I want my government also to be an ongoing partner in the vital task of ensuring that farmers and crofters can be proud stewards of our landscapes and habitats.
That's why following the 2024 round of the Agri Environment Climate Scheme, we are committing an additional £7 million in 2025 to over 390 businesses to undertake activities supporting nature, climate and biodiversity, alongside food production.
The contracts will be supported by £25.4 million over the five-year lifespan, providing long term certainty, enabling our farmers and crofters to nurture Scotland's natural environment.
The 2025 round of applications is also now opening, underlining our commitment to invest in improving our natural environment. The round of AECS will see restrictions lifted on the creation and restoration of hedgerows and pond creation, helping you to help our natural environment.
There are a couple of other issues I would like to address before I draw my remarks to a close. And one of them is of particular significance to your outgoing president.
We've heard that the calls from Martin Kennedy first to be bold and to embrace EID technology to ensure that Scotland remains a world leader in livestock traceability.
I recognise the many and varied benefits of the technology, from better disease control to improved health and safety for livestock farmers.
Mairi Gougeon and Jim Fairlie will have more to say, but I want to confirm today that my government is committed to delivering UHF EID.
We look forward to working with industry and other administrations. But we intend to lead the UK on both on Bovine EID.
You've also pressed us on LIDAR scanning. I'm very pleased therefore to announce a three-year programme of national, land LIDAR scanning, with the intention to begin this summer,
And finally, I want to talk to you about cats. This is a subject that has been significant in my mind in the course of the last seven days.
I have found myself uttering a sentence I never thought I would utter in public life. I have no intention of banning cats.
Well, no, not all types of cats, I suppose. Ministers are acutely aware of the concerns many of you have about the introduction of new species. So let me be very clear.
The recent illegal release of four lynx was both reckless and posed a serious risk to the welfare of those animals released. My government will not be reintroducing lynx, or indeed any other large carnivorous species, in Scotland.
I recognise also that where species have been introduced, such as White tailed Sea eagles that have been unintended consequences.
The emotional and financial impacts for those farmers worst impacted cannot be underestimated. So I've therefore asked Jim Fairlie the Agriculture Minister, to work with officials, NatureScot, and affected producers to agree a way forward. Including ongoing support through the Sea Eagle Management Scheme,
I'd like to finish by saying that I recognise and have always recognised that my parliamentary service, that farmers and crofters make an essential contribution to the quality of life and the sustainability of our rural communities.
Indeed, I cannot conceive of how our rural communities can thrive without a thriving agricultural sector. I believe there are ways in which, by collaboration and cooperation, by being willing to engage as the government is willing to do so, we can address the challenges that you face in stewarding our natural environment and ensuring that we have a sustainable future for the agricultural sector.
I believe the foundation of that dialogue is a constructive relationship, a constructive working relationship between the National Farmers Union of Scotland and the Scottish Government and my ministers and I are entirely committed to taking that forward.
My door will always be open, those discussions will always be open to this industry because I see the community that I've had the privilege to represent all of my parliamentary life.
That Scotland and the Scottish economy and Scottish society, and our international reputation is enhanced by what you all do on our behalf, in stewarding our natural environment, and I want to make sure we create the conditions that that can thrive in the years to come.
Thank you very much.
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