Unfreeze funding on vital rural development schemes, Treasury told

29 July 2016

Farmers and landowners are demanding urgent action from the Chancellor of the Exchequer to unfreeze spending on crucial rural development and environmental stewardship contracts.

The CLA, which represents landowners, farmers and rural businesses has written to the Treasury seeking urgent and decisive action from Phillip Hammond that he will end the suspension of funding imposed on all projects delivered against money allocated from the European Union. These include economic development projects under the LEADER programme, and the awarding of new contracts to farmers for vital environmental schemes such as Countryside Stewardship.

With the application window for Countryside Stewardship set to close in just two months, the organisation said uncertainty over whether funding will be available is putting at risk the environmental management of more than one million hectares of land. The spending freeze also affects business investment which could lead to a crisis of confidence across the rural economy.

CLA President Ross Murray writes: “There is no justification for holding up money that is budgeted for and every day the freeze continues it threatens to do serious long term damage to the rural economy and to the delivery of vital environmental outcomes across the countryside.”

The letter, which follows weeks of intensive discussions by the CLA with officials and Ministers in Defra and the Treasury, also calls for clarity from the Government to make wider commitments regarding the future of the direct payments distributed through the Common Agricultural Policy (CAP) after the UK exits the EU.

Mr Murray writes: “Government needs to confirm that all spending commitments under the current CAP will be honoured, irrespective of the date the UK leaves the EU. If this commitment is not made soon it will have damaging long term implications as businesses stop making vital investments or make more difficult decisions about the future sustainability of their business.”

Despite the short term uncertainty over funding the CLA is advising businesses to continue with applications for projects or contracts under EU schemes, especially Countryside Stewardship before the 30 September deadline.