Chamber and committees

Our forecast spend for the programme has reduced. Initially, £20 million was allocated for the programme and we have allocated £12 million for that for the coming year as well. The funding had not been fully utilised during the past year. I do not know whether Karen Morley knows the exact figure.

Absolutely—we will make it as easy as possible. Again, that is in everybody’s best interests. We do not want it to be a bureaucratic exercise and, for the types of activities that happen through AECS, we want to make any future support as easy as possible for farmers to access. Again, it is in all our best interests to do that.

The committee is currently scrutinising the Agriculture and Rural Communities (Scotland) Bill and, of course, we will be in close communication with the committee on that. There will be a scrutiny process for the secondary legislation that will contain the detail of what any future scheme would look like. AECS may not exist in the same form as it does now, but certainly we want to see the activities that are undertaken as part of that scheme to be more fully embedded within a future framework of support.

We have very ambitious targets, but, as I outlined, our available capital budget for new planting is not sufficient to enable us to meet the target that we set for the coming year. We had hoped to meet our target in the climate change plan of 18,000 hectares of new planting this year, but our current capital budget will not enable us to do that.

The reduction in the marine directorate’s budget is, in part, due to the fact that we are not proceeding with the proposal for HPMAs. We have best utilised that funding in taking forward our priorities for marine protection as a whole. My colleague Màiri McAllan led on the HPMA policy and leads on the marine environment.

Our priority remains to deliver the fisheries management measures for the marine protected area network and the priority marine features. That, in and of itself, is no small exercise. We are looking to implement measures at about 160 different sites, so there will need to be extensive stakeholder consultation as part of that process. Our funding for the marine environment is now being prioritised on ensuring that we deliver on those measures and the previous commitments that we have made.

I do not know whether David Signorini wants to add to that.

Thanks very much, convener and committee members, for inviting me to address the committee today.

When I attended the pre-budget session in September, I set out the priorities of my portfolio. I am pleased to come back to outline how the 2024-25 Scottish budget, which the Deputy First Minister presented to Parliament in December, will help to deliver on those priorities within the wider context of the Government’s priorities.

The budget has been set in turbulent circumstances. At the global level, the impacts of inflation, the war in Ukraine and the after-effects of the Covid pandemic continue to create instability. In the United Kingdom, the combined effects of Brexit and disastrous Westminster policies mean that we are uniquely vulnerable to those international shocks. Those Brexit impacts continue to harm Scotland’s rural and island businesses and communities and create new challenges every year for the rural affairs, land reform and islands portfolio to respond to.

Against that background, the decisions that we have taken in this budget are driven by our values and prioritise our three missions. We have chosen a progressive path: to invest in our people, our economy and our public services. Where we can, we have taken action to prioritise support to the most vulnerable in our communities, to attract investment and support a growing, sustainable economy, and to address the nature and climate emergencies.

My priorities are clear. The budgets allocated to my portfolio will continue to make a vital difference to our rural, coastal and islands economy. As I did in the previous financial year, I will prioritise my portfolio’s direct cash injection of over £600 million into the economy for rural, agriculture, marine and island communities.

The Scottish Government is now providing the most generous package of direct support for farmers and crofters anywhere in the United Kingdom. We are also committed to getting money to people and businesses as early as we can every year, to help them to meet on-going inflationary and cost of living pressures. In 2023, the first tranche of direct payments was made in September—earlier than in the previous year—and exceeded forecasts by paying nearly £300 million in basic payments in the first three weeks. We will continue our critical work with the agricultural sector to co-develop and deliver on the agricultural vision, investing to help Scotland to become that global leader in sustainable and regenerative agriculture. We have also committed to deliver agri-environment investment as part of an overall budget of £30 million to support biodiversity.

My portfolio has expanded to include responsibility for peatland and forestry, and we are maintaining our record world-leading investment in peatland. Investment in new woodland creation planting will continue to contribute to our climate change targets and net zero ambitions.

By maintaining the £14 million for the marine fund Scotland, we acknowledge the vital role that our seas play in supporting the economy in coastal communities through fishing and aquaculture, as well as supporting activity to improve and restore the marine environment.

Our commitment to supporting the ambitions for our islands remains strong, with an investment of £6.7 million, which is an increase on the amount in the resource and capital spending review that was published in May 2022, with £4.3 million now allocated in capital.

Members of the committee have rightly taken a keen interest in the ring-fenced money due to return to the portfolio. I welcome the return of the first tranche of £15 million of that funding in the 2024-25 budget. In the draft budget, that funding is allocated as resource funding, but, across the portfolio, the greatest need is capital priorities. I am glad to have received the Deputy First Minister’s agreement in recent days that the portfolio will instead receive that £15 million as capital funding. It will fund vital unfunded capital priorities within the portfolio, which will provide important support to our rural communities, including the agri-environment climate scheme, the agricultural transformation fund, and crofting grants.

The Government will do what we can with all that we have to support our priorities in rural industries and sectors, through this and other portfolios. The biggest challenge that we face is the on-going failure of the UK Government to at least match fund pre-Brexit levels of funding from the European Union, or to provide a multi-annual funding framework that would allow us to take a longer-term view to some investments. Of course, we have no sense of what the funding future holds from the current—or any future—Westminster Government.

I know that you will want to scrutinise carefully our budget plans, but I would ask again that the committee might resolve to work with Government to support our efforts to secure the future rural funding certainty that Scotland needs and very much deserves. Thank you.

If AECS was not there, a lot of the activities that we would like to see would not take place. Farmers and crofters might not be able to undertake certain activities if the funding did not exist for that to happen, which is why it is such an important fund.

AECS will continue until such point as we have the future tiers of the framework in place.

As I have just outlined in my response to Kate Forbes, there will be changes to the budget lines that have been set out to show the overall switch, but this does not change the envelope. We had had the £15 million confirmed at the time the budget was published, but it was included as resource funding rather than capital. That is what I outlined to Kate Forbes. I can outline exactly in which budget lines you would expect to see changes.

Sorry, I—[Interruption.]

To clarify the point about the £61 million, the deferred funding is not a saving from 2024-25. That was from 2022-23 and 2023-24. If you remember back to when John Swinney was the finance secretary and he made the emergency budget review, that was when £33 million was announced, which was savings that had been taken. In her announcement in November, I think, the Deputy First Minister talked about the savings and the path to balance that we had to reach this year. We are waiting for that £61 million in savings to be returned to the portfolio; £15 million of it has been returned this year, but that leaves £46 million. As I said in my response to Kate Forbes, it has been confirmed that that is coming back to the portfolio, but the sequencing of that and when it happens is still to be discussed with the Deputy First Minister.