Environment and Rural Development Committee, 17 Jan 2007

Meeting date: Wednesday, January 17, 2007

Official Report 251KB pdf

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Subordinate Legislation

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Farm Woodland Premium Schemes and SFGS Farmland Premium Scheme Amendment (Scotland) Scheme 2007 (Draft)

The committee will consider two statutory instruments that are subject to the affirmative procedure, the first of which is the draft Farm Woodland Premium Schemes and SFGS Farmland Premium Scheme Amendment (Scotland) Scheme 2007. The Parliament must approve the draft instrument before it can be made. I welcome, with great pleasure, Sarah Boyack, Deputy Minister for Environment and Rural Development, and her officials. She is here to move motion S2M-5340, in the name of Ross Finnie.

The Subordinate Legislation Committee considered the draft instrument and made no comment. Before we debate the motion, we will be able to ask officials to clarify purely technical matters or to explain details, but the officials cannot participate in the debate that will take place after the minister moves the motion. I invite Sarah Boyack to introduce her officials and make opening remarks.

Thank you. I am accompanied by Jim Johnstone, from the Scottish Executive Environment and Rural Affairs Department, and James Simpson, from Forestry Commission Scotland.

The draft instrument is primarily a tidying-up measure as a result of changes to European legislation. It sets out the adjustments that will be made to payments under the Farm Woodland Premium Scheme 1992 (SI 1992/905), the Farm Woodland Premium Scheme 1997 (SI 1997/829) and the SFGS Farmland Premium Scheme 2003 (SSI 2003/209), in the case of land that is set aside from production under the single payment scheme. The instrument also formally closes the SFGS Farmland Premium Scheme 2003 to new applicants.

Since 1992, farm woodland schemes have encouraged woodland creation by providing annual payments for up to 15 years, to compensate farmers for loss of income as a result of converting agricultural land to woodland. The 1992 scheme was closed to new applicants in 1997 and replaced by the 1997 scheme, which in turn was closed in 2002 and replaced by the 2003 farmland premium scheme. However, payments continue to be made to agreement holders under on-going commitments. Therefore, the three schemes remain in operation but are closed to new applicants.

The first adjustment concerns the relationship between the schemes and set-aside. After July 1995, European legislation specified that woodland used to meet a farmer's set-aside obligations would not attract a set-aside payment. Instead, the woodland would attract payment under the relevant farm woodland scheme. The legislation specified that payment could not exceed the prevailing set-aside rate—in other words, the farm woodland scheme payment rates had to be reduced to the prevailing set-aside rates. Under the new common agricultural policy regime, farmers can continue to use their afforested land to meet their set-aside obligations, but annual woodland payments will be reduced by the amount of the set-aside payments made under the single farm payment scheme for the land in question. The approach in the draft instrument will ensure that there is no double funding, so that the right amount is paid to scheme participants.

The second adjustment closes the SFGS Farmland Premium Scheme 2003 to new applicants. Entry into the farm woodland schemes has always been conditional on the woodland concerned being planted with support under the Scottish forestry grants scheme, which is operated by Forestry Commission Scotland, towards planting and establishment costs. As the Scottish forestry grants scheme is now closed, that means that to all intents and purposes the farmland premium is unavailable to new applicants. The draft instrument formalises that closure.

I hope that I have explained the background to the scheme and what the draft instrument is attempting to do.

Thank you for your explanation. Can you give us a ball-park figure for the number of people who will be affected by the change? How many people are served by the farmland premium scheme and the other schemes that are to be changed? Will people have their support cut off? What demand will not be met as a result of the closure of the scheme?

There are about 3,000 participants in the scheme, about 90 to 100 of whom use the set-aside option each year—doing so is purely optional.

Do you have any idea how much demand might not be met?

Do you mean demand for the scheme itself, as opposed to demand for the set-aside option?

Yes.

The scheme receives a steady stream of applications—perhaps 30 or 40 per month. Applicants will have to wait until the replacement scheme comes into effect.

I welcome the minister to the committee in her new role. Will the draft instrument simply make technical amendments and not lead to a reduction in the overall level of payment? I want to be quite clear about that.

Yes, in essence the amendments are technical. What happens next is that the Scottish rural development plan will bring in a new opportunity for woodland grant schemes under part 3 of the land management contract concept. The draft instrument that we are considering deals with the existing scheme and will close it to new applications, before we move on to the new system.

Will no one lose out?

No one who is currently getting money will lose out. We will then move on to the new system.

What is the timescale for the move to the new system? Will it have the capacity to cope with demand, given that there are currently 30 applications a month?

Land management contracts are being worked up. Officials from SEERAD, Forestry Commission Scotland and Scottish Natural Heritage are working together to ensure that an integrated package is developed. Our best guess would be for entry late in 2007. We hope to be able to deal with demand, because the amount of money that will be in the pot will be similar to the sums that were allocated in the past. However, the new scheme will be rather different and there will be more competition for it. Priorities might change over time.

The rural development plan will have to be approved by the European Commission. We are not quite there yet; the draft instrument is part of a process.

I presume that the optimum time for planting is the end of the year. Will a season be missed, or is that a silly question?

It is a bit early to say, but practical people might guess that there might be a bit less activity during this planting season—the 2007-08 season—than in previous years.

We will keep an eye on the issue as we move from the current scheme to the new one.

However, if there is a delay, we might end up actually skipping a year.

That is why we need to ensure that the land management contracts are put in place and that we get permission from Europe for the rural development plan. We place a lot of onus on ensuring that those things work.

I, too, welcome the minister to her new role.

Further to Rob Gibson's point and that response to Nora Radcliffe's question, I have heard many concerns from forestry industry workers in Moray—which is the constituency that I represent—about the fact that much of the Government's effort on the financing and policy of the scheme seems to be directed at the recreational, rather than commercial, aspects of forestry. Can we be supplied with figures, either today or later, on how the financing of the current schemes is balanced between the promotion of the recreational aspects of forestry and the support of the commercial aspects?

I cannot give the committee those figures today, but I can certainly supply a breakdown of how the Scottish forestry grants scheme has been allocated across the broad priorities of the Scottish forestry strategy.

We will be happy to send that breakdown if the committee will find that helpful.

I have a quick follow-up question. If I heard correctly, James Simpson said that one might predict that the planting rates for 2007-08 will decline. Can he give us a context—what were the planting rates over the past few years? I understand that planting has declined over recent years.

I think that the decline is dependent on the availability of a scheme to which people can apply. At the moment, there is no scheme to which applications can be made. I should point out, however, that we have fully committed our budget for this year on the legacy schemes, so there will still be a lot of new planting under approved schemes that is not dependent on the new scheme being open to entrants.

Following up Richard Lochhead's question about the recreational use of forests, am I right in thinking that, as well as the recreational imperative, there is a straightforward economic benefit to be gained from the recreational use of forests, such as happens at Abriachan, and from all the different ways in which forests are now being used?

Absolutely, yes. In the Scottish forestry strategy, we took the approach that multiple objectives can apply to the use of woodlands. The growing of trees for timber can sit quite compatibly with the use of forests for tourism.

Thank you. Obviously, the committee might wish to keep an eye on some aspects of the issue.

As there are no more questions, we will move to the debate on the motion.

The draft instrument is part of our on-going CAP reform process involving the production of land management contracts and the Scottish rural development plan. I hope that members will be happy to support the motion today so that we can get on with that work.

I move,

That the Environment and Rural Development Committee recommends that the draft Farm Woodland Premium Schemes and SFGS Farmland Premium Scheme Amendment (Scotland) Scheme 2007 be approved.

As no member wishes to speak, I will put the question, which is, that motion S2M-5340 be agreed to.

Motion agreed to.

We will have a short suspension while the minister's officials change over.

Meeting suspended.

On resuming—

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Conservation (Natural Habitats, &c) Amendment (Scotland) Regulations 2007 (Draft)

The regulations are the second affirmative instrument that the committee must consider. The Parliament must approve the draft regulations before they can be made. A motion in the name of the Minister for Environment and Rural Development, Ross Finnie, which the Deputy Minister for Environment and Rural Development will move, invites the committee to recommend to the Parliament that the draft regulations be approved.

The Subordinate Legislation Committee has considered the regulations and has raised no points on them.

Any purely technical matters can be clarified and details can be explained while officials are at the table. I invite the minister to introduce her officials and to make opening remarks on the draft regulations.

Ian Hooper and Chris Bierley are from the Scottish Executive Environment and Rural Affairs Department. Judith Morrison and Gillian Nelson are from Scottish Executive Legal and Parliamentary Services.

The draft regulations are wholly technical. They have resulted from two rulings of the European Court of Justice in which it clarified the meaning of the habitats directive on several points. There were rulings on case C-131/05, which dealt specifically with trade in protected species, and on case C-6/04, which dealt with a wide range of issues, some of which related to protected species and some of which related to protected sites. The amendments do not result from any policy changes and we think that they are unlikely to have any significant effect on the level of protection of Scottish wildlife, which is already high. Some of the new requirements are being met in practice, although they are not explicit in the legislation. For example, SNH already carries out significant monitoring of species and habitats of interest to the Community.

The amendment regulations will mean that there will be enhanced monitoring of the effects of exploitation on species of Community interest; the incidental results defence for offences against European protected species will be removed; the offence of keeping and selling the species in annex IV to the habitats directive, not just those that are native to the UK, will be extended; and any defences for the unlicensed possession of European protected species that were taken after 1994 will be removed.

There will be two main changes in relation to European sites, namely, amendment of part IV of the Conservation (Natural Habitats, &c) Regulations 1994 (SI 1994/2716) to include specific reference to the Water Environment (Controlled Activities) (Scotland) Regulations 2005 (SSI 2005/348), and the insertion of a new part IVA into the 1994 regulations that requires appropriate assessment of land use plans when it is likely that such plans will have a significant effect on a European site or sites.

The Executive consulted on the amendments in the summer of 2006, and a regulatory impact assessment has been carried out. The amendments are not expected to have any significant financial effects on any particular sector. For the most part, they merely clarify the law on a number of issues; they will not create any significant new obligations. However, it is expected that there will be some increase in the requirement for species licensing, although that is not expected to be unduly burdensome to any particular sector or group of individuals.

The Executive has held talks with a range of stakeholders in the past year, and it believes that the package of amendments satisfies the requirements of the European Court of Justice, while taking into account conservation, animal welfare, industry and rural economy interests.

I reaffirm that the draft regulations are technical and are intended to deal only with the requirements of the European Court of Justice, which has clarified the meaning of the habitats directive on a number of issues. I commend the draft regulations to members.

I, too, welcome the minister to her new role.

In a letter of 28 August 2006 to the Public Petitions Committee, David Mallon from the Executive's marine management division, who is not with the minister today, wrote:

"Though the recent consultation on potential improvements to the Conservation (Natural Habitats, &c.) Regulations 1994 in Scotland did not propose amendments in relation to Ship to Ship transfers, the Scottish Executive will assess responses prior to laying draft amendments before Parliament".

We have amendments in front of us, but they do not address ship-to-ship oil transfer. What assessment was made? Why did the Executive conclude that it would not address the issue?

As the minister said in her introduction, the draft regulations deal with the issues that two European Court of Justice judgments raised. They were about how UK authorities, including the Scottish Parliament, had implemented the habitats directive. If the regulations need to be amended in relation to ship-to-ship transfer, that will have to be dealt with separately.

The draft regulations deal only with the two cases, which concerned implementation of the habitats directive. They are not meant to address wider issues. I hope that that helps.

The judgment that the minister mentioned—C-6/04—says:

"Member States are under a particular duty to ensure that their legislation intended to transpose that directive is clear and precise … It follows that the general duties laid down by the United Kingdom legislation cannot ensure that the provisions of the Habitats Directive referred to in the Commission's application are transposed satisfactorily and are not capable of filling any gaps in the specific provisions intended to achieve such transposition."

The general duties on which that ruling judged are an issue in relation to ship-to-ship oil transfers, because only a general duty applies to those transfers. I guess that that is why David Mallon suggested that further consultation would take place before something was brought to Parliament or at least to justify how we still comply with European law.

Officials are considering that issue. Given the complexities of the two rulings, it was felt that the draft regulations should keep to the straight points in the two cases that were before the ECJ and deal with them explicitly. Does Ian Hooper want to add to that?

I can add nothing further. Whether regulations should be changed in relation to ship-to-ship transfer is under consideration, but we have an obligation to respond to the European Court of Justice judgments on the provisions, which are now nearly two years old. We need to put ourselves in a position where the court cannot be dissatisfied with how we have responded.

A commitment has been made to consult. The need to change regulations with regard to ship-to-ship transfers flows from judgment C-6/04. I seek reassurance from the minister that a gap analysis will be undertaken of the consenting regimes in Scotland. I also need to know that discussions will take place with the Westminster Government about closing the loophole in the legislation. We have a letter to the Public Petitions Committee, but other commitments seem to be rather vague. I am looking for certainty before I will feel that the draft regulations should be supported.

We give the commitment that the matter is being considered. I return to the points that Ian Hooper made. We were dealing with issues that the European Court of Justice raised two years ago. The ship-to-ship transfer issue arose more recently, but the Executive is examining it and will have to consider it with a range of UK departments.

Will you assure me about the timescale for that?

That work continues. I cannot give an assurance on when it will be completed, but, having just moved into the post, I am keen to take an interest in it.

Thank you for that assurance, minister.

I seek a simple clarification. Is it a policy decision not to include in the regulations reference to the issues raised by Mark Ruskell? Is it the case that there is no legal obstacle?

The background is that there was reasonable clarity about the court judgment in relation to the way that UK legislation implemented the directive. The Scottish Executive and the other UK authorities have addressed those issues over nearly two years.

The questions about ship-to-ship transfer arose much more recently. They are complex because of the number of different parts of Government that would need to be involved in any amendment. Apart from anything else, we would not have been in a position to put anything into the current set of regulations within the timescale.

Had you been in that position, you could have used the SSI—there is no legal obstacle to your using this particular SSI.

It was clearly a pragmatic judgment. The consultation was carried out last summer, work was well under way and we wanted to get the regulations in place. We are looking at the ship-to-ship transfer issues and we will come back to the committee on those, although I cannot give you a timescale today.

I want to raise an entirely different issue. Regulation 10 substitutes regulation 39 of the 1994 regulations, on the protection of certain wild animals. New regulation 39(1)(a) says that it is an offence

"deliberately or recklessly to capture, injure or kill a wild animal of a European protected species".

Will the minister tell us whether certain birds that are deemed to be game birds in Scotland and Britain are European protected species? If some of the hints that there will be a review of the laws relating to game birds are true, might that give them more protection?

"European protected species" refers to those species in annex 4 to the habitats directive that are native to the United Kingdom. It does not include any birds. The use of the term "European protected species" is specific in this instance.

New regulation 39(1)(c) mentions that it is an offence

"deliberately or recklessly to take or destroy the eggs of such an animal".

However, you say that that refers to animals and not birds?

That might have arisen from a direct transposition from the habitats directive, which refers to certain reptiles, such as snakes and other similar creatures. Legislation that protects birds is mainly found in the birds directive.

Thank you for that explanation.

We thought that we had you there.

That clarification was from informed officials at the top table.

The regulation also refers to turtles.

I have a question about the same regulation, on dolphins, porpoises or whales. Some protection for cetaceans was included in the Nature Conservation (Scotland) Bill, but we received a submission to our marine environment inquiry that asked us to consider banning whaling in our waters. Does the provision in the draft regulations to make it

"an offence to deliberately or recklessly disturb any dolphin, porpoise or whale"

include banning whaling? How far out to sea does that protection extend?

The protection in the regulations covers Scottish territorial waters, which extend to 12 nautical miles from the territorial baseline. The UK department, DEFRA, is introducing a set of offshore marine regulations, which will protect cetaceans in the offshore area. As you are aware, Scottish ministers do not have any power to do that. The regulations that we are considering today would protect cetaceans only in Scottish territorial waters.

However, you said that UK regulations could extend that protection.

That is right.

That is useful to know. If there are no further questions, we will move to the debate.

I will be brief. As I said, the regulations will make technical changes to wildlife legislation and have been brought forward in response to two rulings from the European Court of Justice, which found that, in its view, the UK had not fully transposed into domestic legislation a number of points in the habitats directive.

Although the effect of the regulations is marginal, they will make minor improvements in the protection afforded to our natural heritage. They also clarify the Conservation (Natural Habitats, &c) Regulations 1994 on a number of points. As such, they continue work on the Nature Conservation (Scotland) Act 2004, the purpose of which was to ensure proper protection for Scotland's wildlife and conservation of our natural heritage. The regulations also ensure that Scotland meets its international obligations under the habitats directive.

It is important that the people who will be affected by the regulations are made aware of the changes and their responsibilities. Officials will review guidance, to ensure that people understand their obligations, so that there are clear answers to questions such as those that members asked. It has been useful to consider those detailed points, but a number of other points have not been discussed, in relation to which we want people to be quite clear about their obligations. I commend the regulations to members.

I move,

That the Environment and Rural Development Committee recommends that the draft Conservation (Natural Habitats, &c.) Amendment (Scotland) Regulations 2007 be approved.

Minister, your predecessor's defence on ship-to-ship oil transfers was that the Executive has few regulatory powers over activities in inshore waters under Scottish jurisdiction. The draft regulations could have given the Parliament more power to regulate activities such as ship-to-ship oil transfers. If the minister's intention is to consult on how such activities can be regulated, in accordance with the essence of the Executive's letter to the Public Petitions Committee, I welcome that approach. However, an opportunity has been missed. Judgment C-6/04, which the regulations are designed to address, specifically relates to the need to tighten up general duties through much more specific regulation of activities such as ship-to-ship oil transfer, as I said. If the intention is to act in accordance with the spirit and the detail of judgment C-6/04, the Executive must reconsider the issue. I would welcome further detail from the minister on the urgency that will be given to reconsidering the regulation of ship-to-ship oil transfers.

The committee has no alternative but to approve the regulations, to ensure that we are more compliant with the rulings of the European Court of Justice.

It is entirely proper that the regulations are offered as a coherent whole, because they were consulted on. We must move forward on ship-to-ship oil transfers, but the Executive and the Parliament do business by properly considering consultation responses. It is entirely proper to take two bites at the matter and the regulations represent a considerable bite, which we should welcome.

I want to respond to the points that Mark Ruskell made in particular. We will consider whether changes are required as a result of the debate on ship-to-ship oil transfer, and what any such changes would be. That will require consultation, as there has been on the amendment regulations before you today. The regulations have been through a process. To make other changes, we would have had to stop that process and kick the regulations into the long grass. I hope that you will support the regulations. We will move on to consider the other issues that were raised.

We have to work with other UK departments. Members who have been engaged in the issue of ship-to-ship oil transfer will know that it is complex and that there is no one key player, so we have to ensure that everybody is getting it right.

General duties were not part of the judgment that went to the European Court of Justice. The point that the court made was that the UK could not rely on general duties in its defence against specific points that were raised.

We are taking the issue seriously in the context of the review. It is a technical matter, but it is important that we get it right. I want us to be absolutely sure that we do what is necessary to ensure that we are in line with the letter and the spirit of the law behind the habitats directive. That is why you are considering technical amendments today. There are wider issues for us to consider. Notwithstanding Mark Ruskell's disappointment, I hope that we can get ahead and that the committee will agree to approve the amendment regulations.

Motion agreed to.

That the Environment and Rural Development Committee recommends that the draft Conservation (Natural Habitats &c.) Amendment (Scotland) Regulations 2007 be approved.

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Less Favoured Area Support Scheme (Scotland) Amendment Regulations <br />(SSI 2006/601)

We have one negative instrument to consider. The Subordinate Legislation Committee has commented on the regulations. Its report was published yesterday and members have had the relevant extract circulated to them.

I welcome the regulations. I realise that there are technical difficulties with their coming into force less than 21 days after they were laid, but recipients of support under the LFAS scheme are delighted that the Minister for Environment and Rural Development has gone ahead as quickly as possible. However, it should be noted that, had he agreed to an earlier settlement, perhaps there would not have been such a rush to act before Christmas. On a lighter note, I hope that the "cash flow proplems" that are noted in the purpose of the regulations are in fact spelling problems.

I had not spotted the spelling mistake. I welcome the regulations and I think that we should comment on the enormous amount of work that the minister and officials in the Scottish Executive Environment and Rural Affairs Department have done to achieve this outcome. The work was not easy; it took a great deal of tenacity and bargaining at Brussels to produce the change in the regulations, which is widely welcomed in the farming community.

Those points are noted.

We welcome the payment of the £40 million before the end of January, which, as I understand it, is a payment in advance of the remaining £21 million, which will be paid in the autumn. I still do not know whether the intention in future years is to pay the sum in the autumn or whether it will be paid earlier in the year.

I understand that the scheme rules are being changed, so that compliance has to be in the same scheme year as the single farm payments. The minister's intention is to pay in the autumn from now on, not just this year.

So, in effect, we will move from a spring payment to an autumn payment in future years.

Yes.

Are members content with the regulations and happy to make no recommendation to the Parliament?

Members indicated agreement.

The next meeting is on Wednesday 24 January at 10 o'clock in committee room 2, when we will have our third evidence session on the marine environment inquiry and day 1 of stage 2 consideration of the Aquaculture and Fisheries (Scotland) Bill. Amendments to sections 1 to 19 must be lodged by 12 noon on Friday 19 January. The target for the following week's meeting on 31 January will be to complete stage 2 consideration. Therefore, the deadline for lodging amendments to the remainder of the bill, including the schedule, will be 12 noon on Friday 26 January.

Meeting closed at 12:10.