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Yes, no, in or out: farmers, independence and Europe

Yes, no, in or out: farmers, independence and Europe

The farming community is divided on the question of Scottish independence.

The contrast in opinion is evident across the country, with banners and logos from both sides of the debate firmly planted in fields.

It is a complex issue, and landowners must be confident they understand all aspects of either outcome.

It has been a period of unprecedented uncertainty over the last few years for the agricultural industry. Everything from land reform proposals to the Common Agricultural Policy has been up for debate, offering little assurance for a sound foundation in making long-term business decisions.

Add into the mix the ambiguity of the property market in the lead-up to the referendum, and we are left with a precarious future.

This is before any mention of the current commodity prices or the unreliable weather.

Even after next week’s referendum result, one way or the other the changes will be far reaching.

The bureaucratic untangling required if there is a Yes vote is likely to be vast, and the timescales mooted for the legal “uncoupling” has the potential to be lengthy.

If there is a no vote we are still potentially facing a period of change, with an increase in devolved powers including Scottish land and landfill taxes and the new Scottish rate of income tax.

Perhaps the biggest uncertainty for Scotland’s farmers is whether Scotland will be a member of the European Union.

This is not only a consideration for an independent Scotland but also in the event of a No vote, with David Cameron having agreed a vote on the UK’s membership after the General Election.

With the majority of Scottish farmers receiving support in the form of Single Farm Payment the issue of membership of the EU, at least in the short term, is key for the continued viability of many farming businesses.

Not only would the viability of farming businesses be in jeopardy but also the landscape of the agricultural industry as a whole. The removal of subsidy could lead to large-scale factory farming or, at the other extreme, a reduction in production and an ensuing threat to food security.

Many in the agricultural industry have expressed disappointment in the UK Government. It negotiated a better package of funding from Europe based on the per hectare payment made in respect of Scottish land under the convergence mechanism, but failed to pass this benefit on to Scottish farmers.

On this basis many feel that they would be better able to negotiate a fairer deal for Scottish farmers if they were to be an independent nation within the EU.

It will remain to be seen whether Scotland would be embraced by the EU or not.

It would then be up for debate as to what level of influence Scotland would have in the allocation of subsidy thereafter.

Staying within the UK could mean we exit the EU at some point in the future in any event, but we would at that time retain open borders with our nearest neighbours for trading purposes and movement of stock.

The continued reliance on EU subsidy should not be taken for granted by any farmer.

In many other articles I have expressed the need for forward planning, succession planning and diversification to help ensure the future health of the rural economy.

We have been involved in many great diversification projects leading to excellent secondary income streams helping to insulate against the vagaries of the political, and actual, weather.

As we go forward with yet more upheaval and uncertainty ahead, it is ever more important to review and revise each business to ensure they are fit to survive the storms ahead.

Yes, no, in or out: are you prepared for the future?

Linda Tinson is director of rural business with law firm Ledingham Chalmers based at the Stirling office.