Hansard

I am sure that the member is aware that only 38 per cent of the Europe budget is for CAP. That is one area in which Scotland gets an extremely raw deal. We deserve a greater share of the CAP budget.

The deadline for many of the decisions is approaching. We have to give notification of any pillar-to-pillar budget transfers that we would like by the end of the year. I have written to Owen Paterson to seek a fair deal for Scotland within the UK’s CAP allocation so that we can start to take those decisions.

In particular, the UK received an uplift under the external convergence mechanism, which will be worth more than €60 million per year by 2020, and a total of €230 million over the whole budget period. As that uplift was obtained only as a result of Scotland’s low payments under the current system, at the very least, Owen Paterson must allocate it entirely to Scotland. It is not a case of taking money away from farmers in England, Wales and Northern Ireland; it is about ensuring that money that belongs to Scottish farmers comes to Scottish farmers to help them through the challenges ahead.

The first challenge will be getting through 2014. In theory, the new CAP was supposed to start on 1 January 2014, but that was never realistic under Europe’s timetable. As I said, the main regulations will not even be adopted until November or December, after which the implementation rules will have to be developed. I was frustrated by how long it took Europe to recognise that 2014 will be a transition year, but it has now come forward with a transition regulation, which we are negotiating.

Despite all that uncertainty, I was able recently to set out a plan for 2014. Europe has made it impossible to avoid a gap between the current Scotland rural development programme and the new one, but our plan will minimise the impact on the ground and provide continuity where it is most needed—for instance, with less favoured area support scheme payments, agri-environment contracts and woodland creation.

We have more decisions to turn our minds to. To inform them, we will run consultation exercises on pillar 1 and pillar 2, which will start towards the end of this year. I do not want to pre-empt the results of those consultations, but we have to give as much certainty as we can to the industry.

I would like to outline my thinking. On the pillar 1 basic payment scheme, a consensus is emerging on the establishment of two or three payment regions in Scotland. That would be simpler than some other options, so I am pretty well minded to go with that.

On coupled support, if we are stuck with 8 per cent of the Scottish ceiling, I will give serious consideration to devoting all of that to the beef sector. I know that some sheep farmers will be disappointed to hear that, but their sector already stands to gain considerably from the move to area-based payments.

I am also keen to explore other options for weighting any future beef scheme. The current scheme gives higher rates to the first 10 calves per holding, but the data suggest a decline in slightly bigger herds, so we must review that aspect.

On greening, we will continue to look at the option of equivalence schemes, which we are allowed to put in place, but even the strongest supporters of equivalence are getting slightly cold feet as the details become clearer, and our analysis does not show huge benefits from equivalence schemes for biodiversity, for example. I will reserve my judgment on the issue, but it looks quite complex. However, I want to find out whether we can use equivalence schemes under greening to deliver carbon-reducing measures to help with the role that agriculture plays in our climate change efforts.

There are arguments for and against capping and degressivity, which is the reduction of big payments. I am keen to address the issue of huge individual payments, but we must consider what will happen to those payments in any case. The move to an area-based system should reduce big payments significantly, and we should take that into account when we decide whether to apply an absolute cap to payments. There is another measure called redistributive payment, which is the idea of giving a top-up on the first 30 or 50 hectares per farm. We should look at those options.

We also have decisions to make on pillar 2. I have said many times that the new SRDP must be simpler for applicants and better focused on key areas such as climate change, food and drink, and support for hill farmers and crofters. However, the SRDP is not only for farmers; we must bear in mind that it has a much wider role to play in supporting rural communities. Therefore, many people have a big stake in the decisions that we will take in the coming months.

With such crucial decisions ahead, I look forward to hearing members’ comments on the new CAP. I hope that Parliament will join me in welcoming our negotiating achievements, and that it will welcome our call for the UK Government to provide a much fairer budget deal so that we can work towards a successful new policy for Scotland and our farmers can continue to bring food to our tables and care for Scotland’s magnificent environments.

I move,

That the Parliament notes the importance of the EU common agricultural policy (CAP) for underpinning productive agriculture, delivering environmental and other public benefits and supporting rural development; notes that the EU reached an agreement on a new CAP and welcomes the Scottish Government’s success in negotiating provisions that meet Scotland’s needs on new entrants, active farming and increased flexibilities; looks forward to the Scottish Government’s future public consultations on implementing the new CAP in Scotland; notes that, as a member state, Scotland would have qualified for increased Pillar 1 payments worth €1 billion extra up to 2020 and been able to negotiate improved Pillar 2 rural funding; deplores the budget deal negotiated by the UK Government, which failed to address Scotland’s unacceptably low CAP funding, and calls on the UK Government to deliver a fair deal for Scotland through the UK’s allocation of CAP funds, including the full external convergence uplift to Scotland.

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