Amongst other issues, these letters highlight the Basic Payment Scheme (BPS) entitlements each business holds. Many will now notice that they have a shortfall in entitlements regarding their eligible land.
We would advise farmers to act where these shortfalls exist in any of their payment region portfolios. Galbraith holds a stock of payment region 1, 2 and 3 entitlements that are being marketed at very competitive rates.
Any outlay on entitlements will be more than covered by the BPS 2021 ‘loan’ payments that are due to start in September.
Payment region 1 entitlements, for example, are selling at around 2/3 of the payment rate, offering an excellent return on investment in 6 months.
Galbraith is the largest entitlement broker in Scotland.
Over the years of Single Farm Payment Entitlements and then Basic Payment Scheme Entitlements from 2015, the purchase of entitlements has been a tremendous investment for farmers who have the land but do not have entitlement to claim on it.
Given there is likely to be little change to the current subsidy system prior to 2024, buying entitlements now would be one of the best business decisions a farmer could make in 2021.
Another driver for the purchase of entitlement now is that many farmers believe this may prove beneficial in terms of qualifying for any subsidy scheme that may replace the Basic Payment Scheme from 2024.
It remains to be seen how agricultural support will be decided in the future but most farmers wish to have all of their land eligible for subsidy now because that may have a bearing on how much subsidy the business will receive in future.
If farmers or crofters have spare eligible land that is being claimed in their SAF, we would advise them to make sure it is all covered by entitlements before the 2 April deadline for the submission of transfer requests. As no siphon applies to any 2021 transfers, full payments will be made in the first year.
Contact us for further details on BPS entitlements:
Colin Stewart (Perth): 07711 534794 or Stewart Johnston (Aberdeen): 07717 788683