1. Eligibility criteria
Date published: 26 August, 2015
Technical guidance for the Crofting Agricultural Grant Scheme, Small Farmers Grant Scheme and New Entrants Capital Grant Scheme.
Table of Contents
- 1.1 Eligible purpose
- 1.2 Capital nature
- 1.3 Beneficiary contribution
- 1.4 Common grazings
- 1.5 Croft absenteeism
- 1.6 Agricultural justification
- 1.7 Application for investments recently disposed by applicant
- 1.8 Duplication of grant
- 1.9 Professional fees and other charges
- 1.10 Statutory and other requirements
- 1.11 Conservation and amenity
- 1.12 Restrictions on grant-aided expenditure for livestock
1.1 Eligible purpose
To be eligible for assistance, works must be for the purpose of aiding and developing agricultural production. Care should be taken on approval of large capital items where eligibility may be accessed through a small amount of croft land run in conjunction with a large non-crofting unit. The agricultural justification must be made on the capacity of the eligible unit.
Agricultural production should be interpreted as encompassing all operations up to the normal point of farm/croft gate sale. It does not cover processing operations as distinct from production.
1.2 Capital nature
To be eligible for grant, expenditure must relate to capital works or facilities of a capital nature. These do not need a specified minimum useful life but as a general guide, buildings, roads and other structural works (as well as under-drainage) are expected to have a life of at least 10 years, whereas land improvement operations and plant and machinery should last for a minimum period of eight years.
Works and facilities must be reasonably durable and not makeshift, and be of a kind from which the business will benefit over a reasonable number of years. Replacements, reconditioning and adaptations of existing facilities are not eligible. Making good the normal wear and tear of facilities, repairs, maintenance work, replacement parts as well as normal husbandry operations, are not eligible.
Support will not be available for applications which are solely intended to replace existing improvements and are intended to serve the same purpose as the original. However grant can be provided where it is a first-time improvement, where the improvement is an integral element of a larger project, where a substantive upgrade is involved or where the facility is derelict (i.e. no longer serviceable or fulfilling its function and incapable of being repaired or maintained).
It is a requirement of the scheme that works and facilities are sited, designed and constructed in a sound way in accordance with the nationally accepted standards. They must comply with any relevant British Standard or comparable alternative standard. Grant-aided investments must not conflict with countryside amenity, farm safety and animal welfare requirements, and must be suited to the intended agricultural purpose.
1.3 Beneficiary contribution
Where assistance to any grant-aidable work is provided by way of grant, donation or contribution from a third party, or grant-aidable work is provided by (e.g. local authority) the amount of assistance given by the third party should be deducted from the total cost of the work before CAGS grant is calculated.
Where a local authority makes an award towards the future maintenance of work carried out, the maintenance grant should not be taken into account in the assessment of the CAGS grant-aidable expenditure. Details of any new proposals by local authorities to institute "future maintenance" grants should be forwarded to RPID for consideration before any relevant claim is approved.
Where work is carried out under a government-assisted training scheme, payment may be made under CAGS for the materials. Payment may be authorised towards the cost of materials when they are delivered to the site and a significant start has been made on the work. A proportion of grant should, however, be kept back until the work has been completed satisfactorily.
Contractors - it is open to any partnership of which an applicant is a part to lodge estimates and compete with other contractors in the usual way. Where, however, the contractor is the sole applicant, standard costs can be applied to any grants application/claim in respect of his/her business, or where no standard costs exist he/she can apply on a time and materials basis using timesheets and receipts for any materials used.
In any application/claim lodged by a Clerk to a Grazings Committee who is also a contractor (sole) or partner in a contracting business it is open to him/her to compete for contracts for work to be done on the common grazings.
Any estimates lodged by an applicant/contractor must be carefully scrutinised and compared with known local rates.
1.4 Common grazings
In the case of an application relating to a common grazings or to works required in connection therewith, grant may be offered only to the Grazings Committee or Constable appointed under section 47 of the Crofters (Scotland) Act 1993 but not to an individual crofter or group of crofters.
1.5 Croft absenteeism
Absenteeism does not in itself render an applicant ineligible for grant. Applications/claims from absentees should be fully investigated and the agricultural justification for the application/claim strictly applied to the consideration of the case.
1.6 Agricultural justification
It is a statutory requirement that the work being supported under these schemes must be for an agricultural purpose and for each approved case there requires to be a justification on file. The following points require to be considered before approval or certification of any project:
Agricultural need - with facilities, such as fencing, factors such as containment of stock and improvement of stock management require to be taken into account as well as the size and potential of the croft(s), holdings or common grazings.
Applications for assistance for agricultural buildings may present particular difficulties. The essential concept should be that the purpose of the building must be suitable for the croft(s) or holding(s) which it is to serve. If the agricultural justification is non-existent or dubious, the application must be refused.
The following points should be considered and commented on when preparing a report on the justification of farm/croft buildings:
1. size of croft/holding including any share in common grazings
2. stock numbers (all classes)
3. cropping programme and storage
4. full or part-time working
5. is the unit well worked
6. any other relevant information about the unit or farmer/crofter
7. size of proposed building
8. planned use of the building
9. condition and nature of existing buildings - The pro forma on the back of the CAGS application form (PF08) and CAGS additional proposal form (PF08/a) should be used to help work out the agricultural need for the building proposed – in relation to the existing buildings on the holding. The entries on the pro forma should be assessed by staff to make sure that they are realistic and not over inflated. Entries should be discounted where the officer considers parts of proposals not to be achievable. Relevant comment must be made
Where a permanent building is justified, an applicant may propose to construct one which is larger than deemed necessary for the eligible unit on which it is to be sited. He/she may for example have other agricultural land and, provided that land is eligible under the scheme, a building of a size suited to the needs of the whole area may be approved for assistance.
Where this additional land is in the form of an official sub-let there must be at least five years of the sublease remaining, or in the case of non-croft land the applicant must demonstrate the right to uninterrupted occupation of the land for a period of at least five years from the date of application.
In any road provision case the following should apply:
(i) all require to be agriculturally justified and
(ii) the length of road should be restricted to the minimum length of road required for agricultural purpose. Therefore, any additional distance added to achieve a non-agricultural purpose should be discounted. This is particularly relevant where a road is erected where the purpose is non-agricultural
Planning consideration may affect the siting of a house but generally the majority of agricultural building will only require prior notification and therefore not subject to full planning consideration. In respect of electricity connection grant applications:
- care should be exercised where supply of electricity is being provided to units where currently no domestic property or electricity supply currently exists
- a justification should be carried out to make sure expenditure for capital grant is justified through agricultural needs. Capital grant is not eligible to cover domestic house needs. If a house is intended the provision of electricity should be met by the applicant in the first instance
An applicant may also wish to use a building partly for a non-agricultural use. Approval may still be possible in these circumstances but grant aid would be limited to the agricultural element, as determined by the inspecting officer.
Where the size of a building has to be restricted, by way of agricultural justification, the cost of the building should be reduced by deducting 25 per cent from the total cost of the proposed larger building to allow for the gable ends.
The remaining 75 per cent of the cost should then be divided by the floor area of the larger building and multiplied by the floor area of the larger building and multiplied by the floor area of the smaller, agriculturally justified building and then the 25 per cent (for the gable ends) previously deducted should be added back.
Any fitting-out of the building with electricity etc should also be restricted to that agriculturally justified. In the following example the crofter/farmer wishes to erect a building 12 metres x 30 metres (or 360 square metres) costing £11,000. The agricultural justification requires that the building be no bigger than 12 metres x 18 metres or (216 square metres) therefore the cost, which attracts grant aid, has to be based on the smaller, agriculturally justified, building.
Total cost of building size 12 metres x 30 metres £11,000
Deduct 25 per cent for gable ends £2,750
£8,250 Pro rata floor area £8,250 x 216 square metres = £4,950
Add back gable ends £2,750
Total cost of smaller agriculturally justified £7,700
building (12 metres x 18 metres)
An official sub-tenant or leaseholder of a croft can apply for the full range of grants assistance available, although the length of sublease approved or remaining may restrict their entitlement to major capital improvement works e.g. sub-tenants/leases have less than five years of their lease to run would not be given approval to erect an agricultural building on the sub-let croft.
Value for money - given that the work has been agriculturally justified and is considered necessary for the unit, the officer dealing with the application must be satisfied that the proposed cost for the work is reasonable. Consideration may be given to restricting the approved cost of the work to a reasonable level for the work proposed.
1.7 Application for investments recently disposed by applicant
Careful consideration should be given to any application where an applicant has previously disposed of a capital asset that is now effectively the subject of a replacement application. An example of this is where a fully equipped unit is sub-divided and the equipped part sold or assigned leaving a bare-land unit, the applicant having already benefited from the open market proceeds of the sale or assignation value.
In this scenario the application should be refused support as the unit has been created through his/her own choice and we are merely replacing what was previously under the applicants occupancy. If the occupier of the created unit is new to farming he/she should be considered under the normal agricultural justification.
1.8 Duplication of grant
A general principle of government financial management is that grant assistance from public money to any particular project should come from a single source. This is the case even if there are different sources available.
The aim is to make sure that the total financial assistance is clearly visible, and to avoid duplication of assistance in ways which neither the neither government nor parliament intended. It is therefore the department's policy to prevent the duplication of exchequer-aid towards expenditure incurred on capital investments.
1.9 Professional fees and other charges
Reasonable fees for professional services in connection with grant-aided work will be accepted for grant if:
- the nature of the eligible work justifies professional services which the claimant could not reasonably be expected to undertake
- the fees charged are directly related to specific eligible operations for which grant has been sought, i.e. fees on their own are not eligible for grant
- the person or firm that provided the professional services is "independent" of the claimant or his business or any contractor undertaking the work
- fees are admissible for grant if charged by an individual or professional firm or company wholly independent of the claimant, or a professional firm or company of which the claimant is a partner or member or in which he has an interest, provided the firm has a separate legal personality from the "claimant" in his crofting capacity
- SAC fees should be treated in the same way as those for other professional services but an annual subscription to the SAC is not eligible
- the fees do not exceed 12 per cent of the cost of the approved project
Fees for building warrant, planning permission and any other fees associated with the facility provided, may also be considered subject to the overall 12 per cent rule.
Travelling and subsistence expenses – the most likely appearance of such costs will be in connecting with community industries (i.e. employment training scheme). Reasonable and justified costs should be regarded as eligible especially where remoteness and inaccessibility is an important feature.
General legal fees, accountant's fees or charges for help in preparing a grant claim would be ineligible for grant aid.
1.10 Statutory and other requirements
Applicants/claimants must make sure that all proposals comply with the current safety regulations and, where appropriate, with the current planning requirements, Local Authority Byelaws, Building Regulations, the requirements of the Local Water Authorities, Scottish Environment Protection Agency, British Standards, Codes of Practice, licensing requirements etc.
The Health and Safety at Work Etc Act 1974 imposes a general duty on everyone at work – employers, employees, owners of premises etc to make sure that work places are made and kept safe and healthy to safeguard themselves and others (including members of the public) who may be affected by the work activities.
The responsibility for the enforcement of the Act and Regulations made under or encompassed by it lies with the Health and Safety Executive (HSE) acting as the enforcement body of the Health and Safety Commission (HSC). In terms of this Scheme the responsibility for compliance rests firmly with the applicant/claimant. In cases where doubts about the safety aspect arise the proposal should be returned to the applicant with the advice that he or she should contact the HSE for guidance.
If the doubt arises at the claim stage, the claim should be returned to the applicant and they should be advised in the cover letter to consult with the HSE. Any additional work recommended as necessary or required to comply with any statutory requirement may be considered for grant.
The applicant/claimant also has responsibility under the 1974 Act to make sure that they comply with the Control of Substances Hazardous to Health Regulations 1988 (COSHH): SI 1988 No 1657. These Regulations expand on the general requirement to protect the health of all persons at work, to make sure that no-one may be affected by any hazardous substances while working or visiting the applicant's premises.
In addition, the applicant/claimant has to consider the new Health and Safety at Work Regulations which came into force on 1 January 1993. The Regulations cover Health and Safety Management, Work Equipment Safety, Manual Handling of Loads, Workplace Conditions, Personal Protective Equipment and Display Screen Equipment. Like existing health and safety law these regulations place duties on employers to protect their employees and, in some cases others, including members of the public, who may be affected by work being done.
Control of Pollution Act 1974
Certain arrangements for the disposal of farm effluents require the approval of the appropriate Scottish Environment Protection Agency (SEPA). Circumstances where it is necessary for the claimant to consult SEPA on works include:
- facilities for the treatment and disposal of liquid manure
- facilities for silage effluent disposal; disposal of effluent from livestock housing
- facilities for the disposal of yard or dairy washings
- sheep dip; or dirty rainwater collection works
It is an offence under the Control of Pollution Act 1974 to discharge trade or sewage effluent into relevant waters and in some circumstances onto or into land without the consent of SEPA. The claimant must enclose a copy of SEPA reply with the claim form. If no such approval letter is enclosed the claim should be returned to the claimant advising that he must consult that body.
Control of Pollution (Silage, Slurry and Agricultural Fuel Oil) (Scotland) Regulations 1991
The general statutory provisions on pollution are supplemented by the Control of Pollution (Silage, Slurry and Agricultural Fuel Oil) (Scotland) Regulations 1991. These set minimum constructional and storage capacity standards designed to minimise the risk of pollution of watercourses. The Regulations apply to new, substantially enlarged or substantially reconstructed installations used for the storage of silage, silage effluent, slurry and agricultural fuel oil. SEPA is responsible for enforcing these Regulations and farmers are required to notify their SEPA office, in writing, of the completion of such installations at least 14 days before they come into use.
Guidance Notes on the new Regulations are available from RPID, Environmental Affairs Group, Environment Protection Water Team, Victoria Quay, Edinburgh. In addition, the RPID publication, "Prevention of Environmental Pollution from Agricultural Activity – A Code of Good Practice" provides advice on management practices which can be adopted to prevent, or at least minimise the risk, of causing pollution.
Works on rivers
Where grant is to be claimed on works affecting rivers the claimant should be reminded that the interests of other parties may be affected (for example owners of bridges, pipelines, fishery rights etc and other landowners). Before the claimant commences work he must consult these other parties and SEPA and, where appropriate, the District Salmon Fishery Board, in respect of any interest they may have in the river.
Welfare of livestock
Investments which contravene the standards laid down in the Codes of Recommendations for the Welfare of Livestock (made under Part I of the Agriculture (Miscellaneous Provisions) Act 1968) will not be grant-aided.
Building Standards (Scotland) Regulations 1990
A building warrant is not required for the erection of an agricultural greenhouse or other building of mainly translucent material used mainly for commercial growing of crops, or a building used for any other form of agriculture.
These exemptions do not apply in the following circumstances:
- if the building is used to any extent for retailing or exhibiting
- if the building exceeds 2000 cubic metres in capacity
- if the building is to be erected within 10 metres or the equivalent of its height (whichever is the less) of the boundary of a building which is a dwelling, or institutional or other residential accommodation
- if a wall exceeds 1.2 metres in height or a fence two metres in height
- if the building is a dung stead or farm effluent tank (including a slurry or silage tank)
In order to be considered eligible investments under CAGS, all proposals to construct waste management facilities require a building warrant and a certificate of completion. If the local building control authority does not require this, confirmation of exemption must be included with the application for grant.
The Town and Country Planning (General Permitted Development) Order 1992
Planning permission is required for the following developments:
- developments on farm holdings of less than 0.4 hectares; except within the districts of the former crofting counties where the minimum area 0.4 hectares may be calculated by adding together the areas of separate parcels of land
- the construction, alteration or extension of a dwelling
- any building or works not designed for agriculture
- the construction, extension or alteration of any building over 465 square metres in area, or 12 metres in height or three metres in height where the building is within three kilometres of any aerodrome- development which is within 25 metres of a metalled trunk or classified road
The construction or carrying out of any works to a building used, or to be used, for intensive livestock accommodation or storage of slurry or sewage sludge where that building is within 400 metres of a 'protected building'. A protected building is a building normally occupied by people but does not include buildings forming part of a working farm or certain special industrial buildings.
New prior notification arrangements apply to the following developments:
- erection of new agricultural or forestry buildings not included in the above
- significant, alteration or extension of existing agricultural or forestry buildings (i.e. where the cubic content of the original building is being increased by more than 10 per cent or the height of the proposed new building exceeds the height of the original building)
- certain engineering or excavation operations
A building is defined as 'any structure or erection and any part of a building' and does not just apply to roofed edifices. Walls, bridges, waste management facilities, glasshouses, jetties, piers or slipways are classed as buildings for the purpose of planning law. Dung steads and silos are structures and will come under the term of the new rules. The prior notification procedure requires crofters to notify the planning authority of any proposed development as set out above and to allow 28 days initial consideration from the date the planning authority receives the notification. If no request for details is received within the 28-day period, the development may proceed.
Permitted development status may not apply in any area subject to a Direction made under Article 4 of the Town and Country Planning (General Development) (Scotland) Order 1981 which is used to control development in National Scenic Areas or Sites of Special Scientific Interest. Each Article 4 Direction describes the affected area and the type of development which is no longer permitted without express planning permission being granted. The staff in the conservation section of the planning authority are able to advise about the existence of Article 4 Directions in any specific area and the development which is controlled.
It is a requirement of the scheme that, in order to qualify for grant, work must be of an eligible type and must be of a capital nature. Works must comply with British Standards as appropriate. British Standard Specifications (BS) and Codes of Practice are recognised nationally as setting out acceptable levels of good practice for the production, testing and use of many types of product. Each Standard is drawn up by a committee of experts representing the interested sectors, including designers, manufacturers and users.
The main British Standard dealing with agricultural structures is BS 5502:1978 the 'Code of Practice for the Design of Buildings and Structure for Agriculture'. This Code of Practice give recommendations for design and construction and includes section on health and safety, animal welfare and fire protection. It combines in one standard all the existing elements of accepted good building practice.
Ancient monuments and historic buildings
Many ancient monuments are protected by the law and these include ancient burial mounds, camps and other earthworks, primitive stone structures or old buildings.
If a development might interfere with such a structure then the applicant should be asked to provide evidence that he had consulted Historic Environment Scotland within The Scottish Office Agriculture, Environment and Fisheries Department (RPID) and obtained their agreement to his proposals.
Enquiries about inhabited and potentially habitable historic buildings should be directed to the local Planning Authority.
Applicants who carry out work in the proximity of oil, water or gas pipelines should be asked to provide evidence that the agreement of the pipeline owner had been obtained before carrying out any work.
Overhead electric lines
The Electricity Supply Standard 43-8, issue 2 (July 1988) prescribes minimum clearances to be maintained between "obstacles" and overhead electric lines. However, the minimum clearance depends on the voltage of the line (the higher the voltage, the larger the clearance). A farmer or landowner, who has an overhead line crossing his land will probably have a way leave agreement with the electricity company in respect of the supports sited on his land. Such agreements stipulate that the company will be consulted in the event of any proposals to put obstacles within 30 metres either side of the line. Accordingly, if an eligible person proposes either to erect a structure or to plant trees within 30 metres of any part of an electric line, he/she should be urged to consult the company.
Applicants who apply to erect an electric fence near to overhead power lines should be asked to provide evidence from the relevant utility company to show they have no objections to the proposals. Applicants who apply to erect an electric fence in an area where there may be overhead or underground telephone communications cable should be asked to provide evidence to show that British Telecom has no objections. Roadside electric fences require the approval of the local authority highways department.
Facilities which may lead to pollution of watercourses
Proposals for liquid manure treatment and disposal; silage storage, effluent disposal and disposal of effluent from livestock housing; disposal of yard and dairy washings; dirty rainwater collection works; sheep dips; should meet with the requirements of SEPA or local authority as the case may be, or the appropriate environmental health officer.
In cases where there is evidence to suggest that SEPA or local authority has not been consulted or their recommendations not complied with, documentary evidence should be requested to show that they were satisfied with the proposals.
Codes of welfare for livestock
Proposals must conform with the Codes of Recommendations for the Welfare of Livestock (made under Part I of the Agriculture, Miscellaneous Provisions Act 1968). Where fittings or fixtures within a specialised animal house do not comply, then the whole building, including fittings, is ineligible for grant.
1.11 Conservation and amenity
In addition to areas with statutory protection, Scottish Ministers has the wider responsibility for protecting the wellbeing of all the countryside. The Agriculture Act 1986, Section 17(1) states: "In discharging any functions connected with agriculture in relation to any land in Scotland the Scottish Ministers shall, so far as is consistent with the proper and efficient discharge of those functions, have regard to and endeavour to achieve a reasonable balance between the following considerations:
a) the promotion and maintenance of a stable and efficient agricultural industry
b) the economic and social interests of rural areas
c) the conservation and enhancement of the natural beauty and amenity of the countryside (including its flora and fauna and geological and physiographical features) and of any features of archaeological interest there
d) the promotion of the enjoyment of the countryside by the public
The Nature Conservation Act further places on all public bodies operating in Scotland an obligation to give proper consideration to, and account for, the impacts which their activities and policies have on the overall balance and health of the natural biological environment, at a local, regional, national and international level.
They will be required to act, in ways that are consistent with the exercise of their other statutory functions, in order to make sure that the conservation of that naturally occurring biological diversity is encouraged and advanced.
We must make sure that grant-aided proposals take account of the Scottish Ministers’ obligations under both Acts.
1.12 Restrictions on grant-aided expenditure for livestock
Limitations should be applied on assistance given per business for dairy, pig and poultry production, consistent with the scale of crofting activities.
Fattening/breeding of pigs
Assistance is limited to work related to the provision or upgrading of a maximum of 300 fattening pig places in one business. If the application relates to a viable unit of more than 300 places, no assistance should be offered. Once 300 places in one business have been assisted then no further places should be grant aided.
A business must have sufficient cereal cropping land to produce 35 per cent of its pig feed-stuff requirements, even if it does not actually produce the feedstuff. Assistance should not be given to non-land based intensive pig fattening units.
It should also be noted that assistance is not available to crofters and other eligible applicants who might wish to convert from intensive units to welfare-friendly systems.
Poultry and egg production
poultry includes all domestic fowl, turkeys, ducks, geese, game birds etc for the production of meat or eggs. Assistance may be given only where the number of birds does not exceed 1,000. If the number of birds exceeds 1,000 no assistance at all should be given.