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Scottish Government criticised as cashflow crisis hits Stirling Bull Sales

There was criticism aplenty at the Stirling Bull Sales this week over the Scottish Government’s performance on delivering the Basic Payment Scheme.
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Scottish Government said it hoped to have more details on how farmers can access the £20m fund soon
Scottish Government said it hoped to have more details on how farmers can access the £20m fund soon

With only an estimated 35 per cent of first instalment payments made, the effect was certainly clear throughout most of the sales.

 

Scottish Conservative leader Ruth Davidson on her Monday morning visit said: “It is a mess. People need clarity as to when they are to be paid.

 

"We said back in October that the EU option of paying 90 per cent in advance should have been taken up. Ireland is doing it so why not Scotland?”

 

Farmers attending last week’s NFU Scotland’s AGM heard the extent to which a BPS computer system glitch had caused numerous errors in thousands of claims, meaning many producers were completely unaware of what their total amount would be and how much they would receive in each part-payment.

 

NFUS president Allan Bowie said Holyrood’s failures had ‘stopped the wheels turning’ in the Scottish countryside.

 

Scottish Rural Affairs Secretary Richard Lochhead tried to allay concerns by highlighting the 40 per cent of claims which had been paid, but critics said this accounted for only 20 per cent of the total funding pot.

 

Apologising for the BPS debacle, Mr Lochhead announced the Government had earmarked £20 million to enable farmers and crofters facing delays to access loans to tide them over until BPS payments came though.

 

He added: “I fully accept the current situation is not good enough, and I am sorry we are not getting payments out the door more quickly.”

 

But Ms Davidson queried the £20m hardship fund.

 

Suggesting it was a case of political expediency she said: “It is not in place and there is no accurate information available about how it will be delivered.

 

"I applaud what the banks have done (to make extra funding available) but government should be looking to reimburse farmers for the extra interest paid.”

 

Ms Davidson had come straight from an impromptu meeting with bull sales sponsors Andrew Naylor, head of agriculture with Lloyds Banking Group and Sandy Hay, joint head of agriculture with its Bank of Scotland division.

 

They admitted that although there had been talks with government there was as yet no mechanism for the £20m fund to be distributed.

 

Lloyds Banking Group and BOS had announced last spring that a £500m UK wide contingency borrowing fund would be put in place.

 

Draw down had been slow initially but as farmers realised the BPS delivery was uncertain they had been coming forward. To date around £125m had been spoken for and added to farm overdrafts with no extra arrangement fees. Other banks had similar arrangements in place.

 

Mr Hay said: “We have seen a lot of interest since the beginning of January. It is last minute in many cases and I urge those with cash flow problems to come and speak to us now.

 

Mr Naylor added: “The ambiguity over when payments will arrive and how much they will be is undoubtedly putting everyone on edge.

 

"We do not have accurate figures to hand as to the split between England and Scotland of the £125m advanced so far but it is a fair estimate to say that around 25 per cent of the extra borrowing has been in Scotland.”

 

The Scottish Government said it hopes to have more details on how farmers can access the £20m fund by the end of this week.

 


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