Following further misinformation regarding Less Favoured Areas Support Scheme (LFASS) payments, NFUS is again clarifying the current position.

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The £40 million in payments that has just been issued to LFA producers is supplementary to the £61 million paid out under LFASS 2006 last Spring.  This means that payments under LFASS 2006 now total £101 million. 

There is £61 million still due under LFASS 2007 - discussions are continuing on the timing of these payments.  NFUS has called for these payments to be issued before the end of 2007.

Further background

The agreement to pay a supplementary £40 million under LFASS 2006 was reached following discussions between the Scottish Executive and NFUS and subsequent discussions with the European Commission. 

The discussions were initiated following confirmation that LFASS payments, as well as facing a delay in 2007 because Scotland's Rural Development Plan could not be approved, would have to permanently shift to the back end of the year.  This permanent shift is a result of new EU rules which effectively state that farmers must apply for the scheme, be subject to the necessary administrative checks and paid in the same year. 

The £40 million supplement to LFASS 2006 goes a long way to filling the "hungry gap" in LFA farm accounts this Spring and effectively compensates farmers for a permanent shift to December payments.

To confirm the value of LFASS:

2006 - £101m (£61m paid in Spring 2006 and £40m paid in January/Feb 2007)
2007 - £61m
2008 - £61m
2009 - £61m

The LFA regime will be reviewed for 2010 onwards and details of payment for 2010 onwards are therefore unclear.

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