Scottish farmers are to receive a combined £5.7 million in reimbursement payments from the European Commission this week.
Payments under the Financial Discipline Mechanism will begin arriving in bank accounts this week, with the average reimbursement worth around £277.
The Financial Discipline Mechanism aims to keep the Pillar 1 budget in balance through the creation of a crisis reserve, which is then released back to farmers the following year, if the reserve is not required.
Welcoming the reimbursement, Rural Economy Secretary Fergus Ewing said: “I am pleased to confirm that around 14,500 Scottish farmers and crofters will receive Financial Discipline Reimbursement payments totalling £5.7 million this week.
“The repayment varies in relation to the total value of Direct Payment they receive, so not every claimant gets the same amount, but it averages £277 and will be a small, but welcome boost to eligible farmers’ cash flow.”
Crisis fund
The Financial Discipline mechanism has existed since the start of the Single Farm Payment Scheme in 2005 but was triggered for the first time against Pillar 1 payments in 2013.
The reimbursement for each farmer or crofter is based on the total value of 2017 direct payments (BPS, Greening, Young Farmer and Voluntary coupled support.
Farmers and crofters who receive less than €2,000 worth of direct payments are exempt from the reduction and will not, therefore, receive any reimbursement.
2017 Direct Payments to farmers were reduced by 1.338149% by the European Commission in order to contribute to the creation of a crisis reserve.
In the event, this reserve money was not required and is now being reimbursed. Scotland’s share of the UK’s refund is 16.82% or £5.7 million.
It means the total money to be reimbursed across the UK comes to almost £34 million.
