Scotland Rural Development Programme (SRDP) 2014-2020 Stage 2: Final Proposals

Section 10: Forestry Grant Scheme

Introduction

211. Our intention is to provide a range of grants to help stimulate woodland creation and encourage the sustainable management of existing woodlands.

212. The range of grants for forestry will be similar to what is available under the current SRDP. However, we would like to take the opportunity to introduce some changes. These include offering a wider range of woodland creation options, bringing support for process and marketing under the main forestry grants and introducing brand new grants for tree health and agroforestry.

213. In the stage 1 consultation, it was suggested that Forestry Challenge Funds would be discontinued with Woods In and Around Towns (WIAT) being funded through Rural Priorities (Q8). 81% of the respondents to this question supported the proposal to reorganise forestry funding. We will therefore discontinue the Forestry Challenge Funds under the next SRDP.

Question 10

It is proposed to support forestry under six main areas as outlined in table 4 below. Please identify whether you agree with these broad areas. Please tick the appropriate box in the online questionnaire.

Legal basis

214. The main RDR articles supporting forestry and the corresponding grant options proposed under SRDP are:

EC Regulation Article Number	SRDP 2014 - 2020 Option and Title
Article 23 Afforestation and creation of woodland	Woodland Creation
Article 24 Establishment of agroforestry systems	Agroforestry
Article 25 Prevention and restoration of damage to forests	Tree Health
Article 26 Investments improving the resilience and environmental value of forest ecosystems	Woodland Improvement Grant
Article 27 Investments in new forestry technologies and in processing and marketing of forest products	Process and marketing
Article 35 Forest Environmental and climate services and forest conservation	Sustainable Management of Forests

Table 4: RDR articles used for the Forestry Grant Scheme

215. Forestry landowners will also be eligible to access support through other articles such as article 18 'investments in physical assets' and article 36 'co-operation' for co-operative projects.

Rationale

216. The Scottish Forestry Strategy sets out a vision for Scottish forestry looking ahead to the second half of this century. It recognises that forestry is a long term activity and that well planned and well managed forests provide a wide range of economic, social and environmental benefits. Grant incentives are a major mechanism to achieving the Scottish Forestry Strategy vision.

217. Woods and forests produce crucial raw material for our wood processing industry; contribute to reducing Scotland's net greenhouse gas emissions; enhance biodiversity; protect environmental quality of our natural resources such as water and soil; improve scenery and provide opportunities for access to help improve health.

218. Climate change is a key driver for extending woodland cover. The Scottish Government has a target of creating 10,000 hectares of new woodlands per year for the period 2012 - 2022. The aim is that grant incentives should deliver 9,500 hectares of this target and that new planting by Forestry Commission on the national forest estate should contribute 500 hectares.

219. Forestry and farming have often been seen as separate land uses. Agroforestry systems can offer a range of benefits including shelter, landscape, amenity and biodiversity and encourage better integration between woodland creation and farming.

220. Tree health is important as the incidence and impact of tree pests and diseases in Scotland has increased significantly in recent years and will continue to present a serious threat to the health of Scotland's woodland resource.

Financial allocation

221. The budget allocation for forestry is £252 million (£36 million per annum). This allocation will require to be kept under review to achieve the woodland creation target.

Options and purpose

Woodland Creation

222. We propose nine woodland creation options with support through standard costs.

Woodland Options	Purpose
1. Conifer	To create conifer woodlands on land that is suitable for timber production and that is accessible for timber transport.
2. Diverse Conifer	To create conifer woodlands with a variety of conifer species on land that is suitable for timber production and that is accessible for timber transport.
3. Broadleaves	To create broadleaved woodlands on land that is suitable for timber production and that is accessible for timber transport
4. Native Scots Pine	To create a native pinewood priority habitat
5. Native Broadleaved W4	To create a native wet woodland priority habitat of the W4 NVC type on upland shallow peaty soils
6. Native Broadleaved Other	To create native broadleaved priority woodland habitats of other NVC types
7. Native low density	To create specific native woodland or scrub habitats such as treeline woodlands and black grouse habitats.
8. Small or Farm Wood	To create small scale mixed conifer and broadleaved woodlands on farms and on other rural land property
9. Northern and Western Isles	To create native woodlands that contributes to the Orkney, Shetland or Western Isles woodland strategies.

Table 5: Woodland Creation options

Question 11

We propose nine woodland creation options with support through standard costs. Should these be included? Yes/No/No opinion.

Please tick the appropriate box in the online questionnaire.

Question 12

Are there any other woodland types that should be supported? Yes/No

Please tick the appropriate box in the online questionnaire.

If yes, please specify (in the space given in the online questionnaire).

223. Central Scotland Green Network (CSGN) - Additional Cost Contribution. The present SRDP offers a 'CSGN Woodland Option' for creating woodland within the CSGN area. The creation of one particular type of woodland in the CSGN area lacks flexibility and does not assist well with the delivery of the agreed Woodland Strategies in the CSGN, nor is it the best approach to cover a range of site conditions and landscapes.

224. It is also recognised that due to the small size of the woods being created, the presence of the public and the often highly complex sites mean that owners can face higher costs when creating woods in the CSGN area.

225. To encourage a range of woodland types within the CSGN Area, it is proposed to have a 'CSGN Additional Contribution' for woodland creation types 1-8. There would be two levels of 'additional contribution' to cover 'urban/peri urban' and 'rural' situations.

Question 13

Should the Central Scotland Green Network be allowed an 'Additional Cost Contribution'? Yes/No

Please tick the appropriate box in the online questionnaire

If No, please briefly explain your reasons (in the space given in the online questionnaire).

Income foregone payments for woodland creation on agricultural land

226. The current SRDP includes a separate income foregone (IF) payment called Farmland Premium to compensate farmers for loss of agricultural income. The current cost model for IF includes direct payments from the Single Farm Payments Scheme. It is therefore currently not possible to pay both Farmland Premium and DP on the same area of land as this would result in overcompensation.

227. A new SRDP represents an opportunity to consider the future design of the total woodland creation grant package and relation to DP. In the new programme it will be possible to pay up to 100% of woodland creation standard costs (under the current programme the initial planting is limited to 70-90%). This may give flexibility as to how space woodland creation grants are structured under the next SRDP.

228. We see three options:

Options for IF payments in SRDP 2014 - 2020	Pros/Cons
Option 1: Minimal change to design structure available in 2007-2013 SRDP. Grant structure would be: initial planting payment maintenance payments years 1-5 IF payment to maximum of 12 years (as permitted under new regulations)	Understood by forestry sector as similar design structure to 2007-2013 SRDP, (albeit that new regulations limit IF payments to a maximum of 12 years.) Not eligible for Pillar 1 Direct Payments (DP) Complex to administer, with a long tail of income forgone payments, claimed annually through the SAF.
Option 2: IF payments removed. Woodland creation capital and maintenance payments enhanced using intervention rate to offset the loss of IF. Pillar 1 payments available on afforested land. Grant structure would be: initial planting payment maintenance payment years 1-7 no IF payment	Eligible for DP payments Simplifies payment period and reduces complexity Potentially higher initial planting payments
Option 3: IF payments to remain with calculation to exclude DP payments. IF paid over shorter period and at a lower value to avoid over compensation. Pillar 1 payments allowed on same area of land. Grant structure would be: initial planting payment maintenance payments years 1-7 IF payment year 1-7	Compensation available for agricultural income foregone which is separate from DP payments Can be paid where agricultural activity was present on land without entitlement to DP payments. Eligible for DP payments Farmland Premium payments likely to be reduced to avoid over compensation Complex to administer

Table 6: Options for income foregone payments for woodland creation

Question 14

What is your preferred option for Income Foregone in SRDP 2014 - 2020? Please tick the appropriate box in the online questionnaire.

Option 1
Option 2
Option 3

Please explain your choice (in the space given in the online questionnaire).

Other support for woodland creation

229. It is also proposed to provide support for woodland creation through:

• Tree shelters and fencing, available as stand-alone standard costs.
• Improved vegetatively propagated stock for Sitka spruce (SS), as stand-alone standard cost. (Improved SS stock from seed orchard material would be an eligibility criterion of the new scheme.)
• A Bracken Contribution available for conifer, diverse conifer and broadleaves to encourage woodland planting for timber production by targeting bracken areas.
• Support for Community Woodland to encourage public access where there is justified demand and where at least 50% of proposed planting is located within 1 km of settlements with a population of over 2,000 people.

Question 15

Do you agree with the range of 'other support' for woodland creation? Yes/No/No opinion. Please tick the appropriate box in the online questionnaire.

Agroforestry

230. The aim is to support the creation of small scale woodlands with a maximum of 400 trees/ha that will allow for an integrated approach to land management where trees and domestic livestock can co-exist. Grant support will be through standard costs. The area established would be eligible for DP payments.

Question 16

Should agroforestry be funded through the SRDP 2014 - 2020? Yes/No/No opinion.

Please tick the appropriate box in the online questionnaire.

Tree health

231. The Scottish Government aims to support woodland owners where a non-routine tree pest or disease has caused, or is expected to cause, significant impacts beyond those requiring initial emergency action. Support relating to restoration will be limited to those cases where at least 30% of the relevant forest potential has been destroyed (this is not limited to productive capacity and can be assessed at sub-country level and, if appropriate, at the level of individual tree species).

232. Support will only be considered for tree pests and diseases listed in the UK Plant Health Risk Register.

233. Operations supported will include: the provision of competent agents' services (where harvesting and marketing is necessary); preventative measures such as non-routine silvicultural interventions or the targeted application of approved pesticides (including fungicides and biological control agents); sanitation felling/killing/removal of relevant tree or host species; and replacement planting.

Question 17

Should Tree Health be funded through the SRDP 2014 - 2020? Yes/No/No opinion.

Please tick the appropriate box in the online questionnaire.

Woodland improvement

234. The aim is to support forestry operations that enhance the environmental and public amenity values of existing woodlands. In particular, improvements that will benefit woodland habitats and species that are priorities in the UK Biodiversity Action Plan. A Management Plan/Forest Plan will be essential.

235. Grant support will be through standard costs.

236. We propose eight Woodland Improvement Grant Options:

Option	Purpose
1. Long term forest planning - new	To encourage the sustainable management of forests and woodlands through a long term Forest Plan. Approval of the Forest Plan gives approval for felling and thinning for 10 years
2. Long term forest planning - renewal	To encourage the sustainable management of forests and woodlands through renewal of an existing long term Forest Plan. Approval of the Forest Plan gives approval for felling and thinning for 10 years
3. Reducing Deer Impact	To improve the ecological and environmental value of woodlands by reducing the grazing pressure from deer.
4. Woodland Habitats and Species	To support woodland operations that will benefit priority habitats or species under the UK Biodiversity Action Plan
5. Restructuring Regeneration	It is our intention to offer a single restocking payment to replace the Restructuring Felling and Restructuring Regeneration grants. The range of woodland types will be similar to those proposed under woodland creation.
6. Non- Woodland Habitats and Species	To support operations that will benefit non-woodland habitats and species that are a priority under the UK Biodiversity Action Plan
7. Natural regeneration	To support operations that encourages the natural regeneration of existing native woodlands.
8. Woodlands In and Around Towns	To support operations that will improve the public access opportunities in WIAT areas through the creation and upgrading of paths and routes, provision of facilities and amenities and monitoring of access use to the 'WIAT Management Standard.

Table 7: Woodland Improvement Grant Options

Question 18

Do you agree with the range of Woodland Improvement Grants? Yes/No/No opinion.

Please tick the appropriate box in the online questionnaire.

Process and marketing

237. This option is designed to provide support to forest owners, micro-enterprises and small and medium enterprises (SMEs) for investments which enhance forestry potential or relate to processing and marketing, or adding value to forest products.

238. It will support:

The development of the small scale premium softwood and hardwood processing sector;

Equipment to increase harvesting in small undermanaged woods including small scale purpose built harvesters, machinery and equipment but not tractors;

Equipment to increase capacity for steep ground harvesting.

239. We are minded not to support the purchase of equipment for wood fuel processing given the support already provided to the sector through the Renewable Heat Incentive.

Question 19

Should these areas be supported through the SRDP? Yes/No/No opinion.

Please tick the appropriate box in the online questionnaire.

Sustainable management of forests

240. The aim is support for the sustainable management of existing forests and woodlands of high environmental value. A Management Plan/Forest Plan will be essential.

241. Grant support will be through an annual standard grant rate/hectare for period of five years, with a higher grant rate for designated sites.

242. We propose six Sustainable Management of Forest Options:

Options	Purpose
1. Native Woodlands	To maintain or bring native woodlands into good ecological condition or to restore plantations on ancient woodland sites (PAWS) to native woodland
2. Low Impact Silvicultural Systems (LISS)	To encourage small scale felling and contribute to the species and structural diversity in forests
3. Public Access	To support the management of woodlands in areas where there is a high level of public access and recreational use.
4. Public Access WIAT	To support the sustainable management of woodlands in WIAT areas (woods within 1 km of settlements with a population of over 2000 people) to achieve WIAT Management Standard.
5. Livestock Removal	To encourage the management of native woodlands through the removal of livestock
6. Woodland Grazing	To enhance biodiversity and condition of native woodlands through controlled livestock grazing

Table 8: Sustainable Management of Forestry Grants

Question 20

Do you agree with the range of Sustainable Management of Forest grants? Yes/No/No opinion.

Please tick the appropriate box in the online questionnaire.

Co-operation

243. Grants will be available to encourage co-operative forestry projects. This will be targeted by identifying projects such as water quality improvement in priority catchment areas and removal of invasive non-native species. Details for Co-Operative Action are given in section 11.

How it will work

244. The application process for forestry grants is outlined in section 5.

Question 21

How would you rate your broad satisfaction with the proposal for the Forestry Scheme?

Very satisfied
Quite satisfied
Neither satisfied nor dissatisfied
Quite dissatisfied
Very dissatisfied

If you are dissatisfied please briefly outline your reasons (in the space given in the online questionnaire).