The Scottish Government has confirmed that it will not be reversing the decision to cut 2019 Less Favoured Areas Support Scheme claims by £13.5m. A spokesperson said: “As announced earlier this year, under EU rules there is no option but to revise the payment rates to 80% of the current rates to continue with LFASS.”

This comes after meetings before Christmas when industry representatives discovered that a derogation from the EU rules was impossible and that the 20% cut be unavoidable.

NFU Scotland is currently developing proposals to use EU de minimis regulations to top up all but the largest claims.

The proposals could give farmers up to €15,000 over three years.

Concern

“There is real concern that the Government has given up the fight on the 20% cut. It is disappointing that the industry found out that a derogation was not possible so late in the day.

This change has been coming down the line for some time,” said NFU Scotland policy director Jonnie Hall.

“Hill farmers are coming through an extreme 12 months. We met the Scottish Government in the summer where it was agreed we would seek a derogation for 2019 and 2020.”

The importance of LFASS support was underlined by Lorraine Luescher, of Glendinning Farms near Langholm, who ran through some of the costs hill farms are incurring.

“Feed blocks are up by £30/t this year, straw is costing up to £135/t, and the prices of vaccines and injectable scab prevention have risen by 8% this year,” said Luescher. “Ewe rolls have increased in price by 32% since 2015, from £195/t in October 2015 to £257/t in October 2018.”

National Sheep Association chair John Fyall said: “We knew the derogation was a slim chance but 11th hour negotiations is a terrible position when so many livelihoods who don’t just like the payment but depend on it.

‘‘The £65m per annum was programmed to support the LFA until 2020 and it is only the delivery mechanism that needs changed. The budget and the need are still there and this period of scarce fodder and Brexit uncertainty is certainly not the time for Scotgov to be swooping on agricultural funding.”

The EU support rules are forcing countries to wind down their historic upland support schemes, such as Scotland’s LFASS. Stage one is a cut of 20% for 2019 claims with 2020 claims seeing an 80% reduction.

Rural Economy Minister Fergus Ewing made a commitment at Agri Scot to focus government efforts on stopping the 80% to 2020 claims.