28 September 2020

Dear Kevin,

We write with regards to the LEADER programme for supporting development in rural communities.

You will be aware that this programme has delivered significant benefits to our island communities over the years, but at this point does not have secure funding beyond the end of March 2021. Without an extension to this deadline, however, a number of vitally important projects risk remaining incomplete. These projects are community-led developments that have involved a great deal of work already. Not surprisingly, however, the restrictions introduced in response to the current covid-19 pandemic have prevented or significantly delayed work to the extent that many will struggle to reach completion within the existing funding timeframe.

The specific circumstances in each of the island authority areas are, of course, different but the underlying problem is the same, as are the potentially damaging consequences. The attached briefing note gives more detail on the situation in relation to the projects under threat in , and the Western Isles.

We ask, therefore, that steps be taken to extend the deadline beyond April 2021 until the end of the year to enable enough time for these projects to be taken forward by those responsible in the communities directly affected. This seems to us a sensible, reasonable and regrettably necessary ask.

Should you or your officials require additional detail, this can certainly be provided by the lead officials in each of the island authorities. Meantime, we look forward to hearing from you at your earliest convenience, given the urgency of the matter.

Yours sincerely,

Liam McArthur MSP MSP MSP for Orkney MSP for Shetland MSP for Na h-Eileanan an Iar

The , EH99 1SP

Cabinet Secretary for Rural Economy and Tourism MSP  F/T: 0300 244 4000 E: [email protected]

Liam McArthur MSP Beatrice Wishart MSP Dr Alasdair Allan MSP

Our Reference: 202000093254

19 October 2020

Dear Liam, Beatrice and Alasdair,

Thank you for the letter of 28 September regarding the LEADER programme for supporting development in rural communities.

Your letter covers the constituencies of yourself, Beatrice Wishart MSP and Alasdair Allan MSP, all of which cover remote and island locations. The issues you comprehensively outline are indeed deeply concerning and of which I am already fully aware. The issue of the LEADER Programme end date is common throughout rural but I acknowledge that the impact is particularly serious in Orkney, Shetland and the Western Isles. The note from Orkney references “the future follow on Programme to be in place for a seamless transition”, however at present there is no future funding in place. Indeed, I wrote again to George Eustice, now Secretary of State, on 22 June 2020 to press for urgent clarity and written assurance of future funding. Also Ms , as Scottish Finance Secretary, has sent a letter together with the Finance leads of the Devolved Administrations, to Rt Hon Stephen Barclay MP, Chief Secretary to the Treasury on 2 September 2020, regarding clarification around funding elements of EU programmes. Uncertainties around the Scottish Budget were intended to be resolved after the UK Budget had been set. Now that the UK Budget has been cancelled, this adds further complications and possibly delays for Scotland.

The has already agreed local flexibility, to allow Local LEADER Teams to use any underspends for increased costs, due to COVID-19 and this should go some way to helping projects, when the time comes to claim. The SG LEADER Delivery Team has recently had engagement with Accountable Body staff at the AB meeting on 30 September, also with Local LEADER Teams on 1 October, where we have ensured all staff are up to date on the current ongoing work within the SG and the impact that the delay in the Spending Review has had, to being able to provide the certainty around a post LEADER CLLD approach which includes retaining current Local LEADER staff and any possible programme extension, if deemed applicable. Staffing costs for January to March 2021 has been confirmed as being covered by current indicative allocations. Future staffing costs will be determined once certainty around a future CLLD approach can be given.

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Going forward, the UK Government has stated that they will use Structural Funds’ money that comes back to the UK following Brexit, to create a UK Shared Prosperity Fund. Scottish Ministers are deeply concerned that there is still no detail on this fund and no clear commitment by the UK Government to engage with all Devolved Administrations as equal partners, rather than as consultees. It has been indicated that non-farming support currently delivered via the CAP, for example LEADER, will, in future, be covered by the UK Shared Prosperity Fund, however, no clarity or detail has been provided. It is vital that the UK Government tells us more about the Shared Prosperity Fund and how it will support our rural communities and businesses.

Uncertainties caused by Brexit and future UK funding, would have had some impact on operational delivery of all previously EU financed Programmes but the added unforeseen complications caused by COVID-19, are something we are trying to work through, to give stakeholders future funding guarantees. As you note, I have already agreed an extension to the end date for the LEADER Programme, from 31 December 2020 to 31 March 2021, as this date is still within the current Financial Year but until there is confirmation on the Scottish Budget for the Financial Year 2021-2022, I cannot grant any further extension. My staff are preparing budget forecasts in readiness for any decisions on possible future funding and Local LEADER teams will be advised of any progress via the usual channels, as soon as any decision is made. I hope also, that any future funding will be in place in time, to allow those delayed projects to finish. The project risk registers are being used to see if money can be provided for additional costs to ongoing projects due to COVID-19 restrictions, or if appropriate to additional activities to ongoing projects which are COVID-19 related recovery.

I am hopeful of certainty in the latter part of the year, around November and that the outcome of the Spending Review will be known and with that the details around the LEADER/CLLD programme approach.

Yours sincerely,

FERGUS EWING

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