Crofting House Loans not being restored

6 August 2009


Crofters will not get croft house loans restored, after the Scottish government refused to re-establish the scheme which the Scottish Parliament Rural Affairs Committee unanimously recommended.

The move has been labelled "another blow to crofting" by Highlands and Islands Labour MSP, Peter Peacock and "misguided" by Sarah Boyack MSP, Labour's Shadow Rural Affairs Minister who visited a number of crofting communities in the Highlands and Islands during the summer.

The Scottish government's refusal to act is revealed in their formal response to the Parliament's Rural Affairs Committee report into rural housing, which specifically recommended that the croft house loans fund be uprated and re-introduced in light of the changing private mortgage market.

Instead the Scottish government are falling back on the much criticised proposals in their controversial reform Bill which would require crofters to pay a 250 fee to register their croft as a basis for giving a standard security over the croft to a bank in return for a loan.

This is one of the provisions in the Scottish government's croft reform proposals which is causing deep concern and generating opposition to the proposals.

Speaking after meeting with crofters representatives, Sarah Boyack said:

"The government's decision is misguided.

"There is real concern that registering your croft and being charged 250 for the pleasure of doing so is not a guarantee of a bank loan and has the effect of putting the whole croft in jeopardy if the loan is ever defaulted on.

"This could lead to banks selling off crofts to the highest bidder and increasing speculation.

"Crofters have told me they believe that re-establishing the loans fund and uprating the amount available for loan is the best answer and, given that the government are prepared to put lots of taxpayers money into the system to set up a register of crofts to open up commercial loans, they would be far better putting it into a loans fund for croft housing. "

Peter Peacock MSP, who along with Highlands and Islands colleague Rhoda Grant sat on the rural affairs committee of parliament which made the recommendation to restore the croft house loans fund said,

"This is another blow for crofting. Rhoda Grant and I pushed for this recommendation and won the support of the Committee and it is very sad indeed that the Scottish government have responded so negatively.

"The economic circumstances have changed so much in recent times, with commercial loans becoming much, much harder to obtain, that the committee saw real merit in restoring the loans fund. This would be the easiest route to supporting crofters.

"Not for the first time in recent times has this government has failed to come up to the mark over crofting.

"Last year they tried to end the bull hire scheme and support for fox control clubs and it was only by holding them to account that we got both those decisions changed.

"More recently they have proposed changes to crofting that most crofters see as highly damaging, and now this decision."

Sarah Boyack and Peter Peacock comments come after they had discussions with the Crofting Foundation, visited a number of crofting areas and assessed the outcome of a significant amount of correspondence they had been receiving on the government's draft crofting reform bill.

Sarah Boyack said: "The Scottish government's reform proposals are proving to be very controversial and have won very little support.

"We will be taking a very tough line in Parliament in scrutinising this Bill and in opposing its worst provisions, if the Scottish government decide to proceed with it.

"Instead of seeking to push through controversial legislation they would be better occupied using the new powers that we left them from our last Crofting Act to direct the Crofters Commission.

"These powers were created specifically to allow Ministers to address concerns that were, and still are, being expressed about the priorities and performance of the Commission.

"For example, the government could use their new powers to get more action on derelict crofts and all it needs is the Scottish government to use its powers to direct that to happen."

Peter Peacock MSP said,

"Not only is it clear the Scottish government have got the details badly wrong in a number of respects in their reform proposals, they also seem to have missed an opportunity to introduce other matters into the draft Bill that could help in the practical problems facing crofting.

"Their approach is going to need radical change if it has any chance at all of getting through parliament.

"We will be arguing for that change and seeking to protect the interests of crofters."



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