The report by the Scottish Parliament’s Rural Affairs Committee raises serious concerns over the Executive’s handling of the Agricultural Business Improvement Scheme (ABIS).

Convener Alex Johnstone said:

"Since our committee began this investigation we have encountered a series of ‘stop-go’ decisions by the government, one minute delaying farmers applications, the next encouraging requests for EU and government money.

"We have grave concerns about the way in which this scheme has been administered. The Executive’s ill-considered late decision to encourage farmers to apply for funds will result in many of them being left disappointed and out of pocket. Although the Executive failed to put an exact figure on the over-subscription, indications are that it could be as much as £23.133 million.

"We are, therefore, urging the Executive to consider again whether further money can be secured to fulfil the commitment made by Lord Sewel, the former agriculture Minister at the Scottish Office, to accommodate any upsurge in applications.

"It is vital that lessons must be learned from the way in which ABIS, a relatively small scheme, has been run, as the Executive will be required to administer much bigger programmes in the near future. I hope our call to the Audit Committee to ask the National Audit Office to examine this case will be seen in a positive light which will help all concerned to benefit from this experience."

BACKGROUND NOTES

ABIS is a European funded grant scheme, which, since 1994, has encouraged farmers to invest capital to enhance the potential of their businesses. Now, within weeks of the close of the scheme, the Committee has been informed that Departmental forecasts of up-take failed to identify a significant surge in applications in the two months before the closing date for applications, of 31 October 1999.

All outstanding applications must be processed, successful applicants offered a grant and the offer of grant formally accepted by 31 December 1999.

The committee’s membership is as follows:

John Munro, Alasdair Morgan, Alex Fergusson, Cathy Peattie, Alex Johnstone (convener), Irene McGugan, Elaine Murray, Mike Rumbles, Lewis Macdonald, Rhoda Grant and Richard Lochhead.

Media can obtain hard copies of the report from the Parliament’s Media Relations Office. The report is also available on the Parliament’s website.
Members of the public can buy copies of the report from outlets of The Stationery Office, priced £11.50.