Jan 25 2020
STFA welcomes cap on convergence payments
News Release
Scottish Tenant Farmers Association
23rd January 2020
STFA welcomes cap on convergence payments
The Scottish Tenant Farmers Association (STFA) has welcomed today’s announcement by the Cabinet Secretary Fergus Ewing confirming that convergence funding payments of £80 million and an additional £10 million for Regions 2 and 3 will be made to farmers and crofters by the end of March 2020.
This represents the distribution of the first tranche of the £160 million convergence money promised to Scotland by the UK Government following 6 years of lobbying by Scottish farming interests. The remaining £70 million is due to be distributed in the next financial year and will be paid by the end of March 2021, once delivered by the UK Government. Of this £70 million, £42 million may be used to maintain next year’s LFASS payments.
Not including addition payments of £13 million towards the LFA and £15 million towards the beef calf and sheep coupled schemes, the remainder of the £90 million due by the end of March 2020 represents a top up of £15.86 per hectare for Region 1, £28.03 per hectare for Region 2, and £11.87 for Region 3.
A cap of £55,000 is to be applied to the total combined convergence totals which is expected to affect around 80 businesses in Scotland.
Following the announcement by the Cabinet Secretary, STFA Chairman Christopher Nicholson said: “We now have clarity as to when the convergence funding payments to farmers and crofters will be made, which is welcome news given the uncertainties faced by Scottish agriculture resulting from Brexit. The Cabinet Secretary has adhered to the spirit of convergence and ensured that the funding will go to where it was originally intended.”
“Having argued strongly in favour of capping payments, we welcome the cap in principle. However, capping convergence payments at £55,000 will affect very few producers and we believe a lower cap at £35,000 would have given a fairer distribution of funds bearing in mind the minimal activity requirements for BPS claims. To put into perspective, at a level of £55,000 the cap will only affect Region 1 businesses if over 3,400 ha in size, or over 1,900 ha for Region 2 and 4,600 ha for Region 3.”
“Some of the convergence funding will be used to maintain LFASS payments for this year and next. With such a large proportion of Scotland’s farm businesses located in remote and marginal areas it is vital that the LFASS budget is maintained until a new replacement scheme is introduced.”