- 25 Mar 2020
COVID-19 is having a profound impact on all aspects of Scottish life. We are living in unprecedented times and as such our response to the current situation will be rapid, decisive and meaningful. The First Minister has already outlined the actions the Scottish Government is taking, alongside the UK Government, to preserve life and protect business.
Action is now required to protect the future of Scotland’s fishing businesses and the social fabric of our fishing communities which, due to the immediate and devastating impacts on markets, is now under threat. The Scottish Government is acting immediately, providing a package of financial support for our most vulnerable fishing businesses, with payments to be made direct to eligible fishers as soon as possible.
This initial support will go to those that need it most and whose access to markets has disappeared almost overnight. The Scottish Government has identified and has started contacting vessels who will be directly offered funding. Urgent action is needed to protect these businesses in the short term, so that they can continue to provide food and employment in the long term.
Key features of the scheme are:
- those vessels receiving initial funding are all Scottish Registered vessels of 12m and under in length, and who have no other form of income to support them -– this includes creelers, divers, and smaller trawlers and dredge vessels, many of whom operate in remote and island communities
- payments will only be made to those making a full time living from commercial sea fishing
- eligibility will only be for those who have or will suffer market failure or loss and not where alternative markets clearly remain
- for those eligible an initial payment of 50% of two months’ average vessel earnings will be made
- initial payments will be capped at a maximum of £27,000 as we explore State Aid restrictions and where there are owners of multiple vessels
Those vessels not eligible for this initial support package, but who feel they are in urgent need of support, are invited to submit an enquiry to the contact email below. We recognise that all fishing businesses are different, and will consider any such enquiry for financial support on a case by case basis. In addition, over the coming weeks we will continue to work closely with fishing industry representatives, and will keep the support package under regular review as the situation evolves.
We stand ready to support Scotland’s fishing fleet through this crisis and to provide the appropriate support to enable it to weather this difficult storm for the benefit of the people of Scotland and our future generations to come.
If you own a fishing business that has been impacted by COVID-19, you may be entitled to financial support from the Sea Fisheries Intervention Fund, which offers financial support for eligible vessels under 12m and over 12m. Below are some answers to common questions about the fund for vessels under 12 metre.
What support is available for the fishing industry during the COVID-19 crisis?
The Scottish Government is making available £23.5m in financial support to the seafood industry. This consists of:
- Up to £3.5m to the over-12m shellfish sector
- Up to £6m to the under-12m shellfish sector
- Up to £3m to trout and shellfish aquaculture, and
- Up to £10m to the onshore fish processing sector.
Who is eligible for the new scheme?
The under 12 metre fleet support scheme is open to active Scottish Registered vessels of 12 metres and under in length, and who have no other form of income to support them -– this includes creelers, divers, and smaller trawlers and dredge vessels, many of whom operate in remote and island communities.
Like the scheme for vessels over 12 metres, vessels must have made a minimum of £20,000 landings in 2019 to be eligible. Landings are calculated using the information we hold internally e.g. from FISH1 forms and electronic log books.
What types of business can get support for vessels under 12m?
We are prioritising the most vulnerable parts of the fishing fleet, whose markets have been most severely impacted by COVID-19. This includes creelers, divers, smaller trawlers and dredge vessels, many of whom operate in remote and island communities.
Do you use overall or registered length to determine fund eligibility?
We are using overall length to define eligibility for both tranches of funding. Those vessels who are registered as under 12m, but which have an overall length of over 12m will be considered under this new tranche of funding for over 12m vessels, including those making appeals against the original scheme for vessels less than 12m. This will ensure consistency of approach between the two schemes.
What is this money for?
This funding will see vital cash going to vulnerable fishers as quickly as possible to avoid bankruptcies and enable owners to continue to fish to even limited markets, especially here in the UK but keeping the vital supply of food continuing. We expect vessel owners to use this funding to also support any crew they might employ. After this point share fishermen who are classed as self-employed should, like other self-employed persons, be in receipt of their self-employed support from the UK Government.
Do I have to fill in an application form?
Eligible vessels have been sent an application form to complete. If you have not been sent a form but think you might be eligible, contact firstname.lastname@example.org.
I have not been sent a form to apply for the fund. What should I do?
If you think you are eligible for support and have not already been sent a form, contact email@example.com.
How do vessels know if they are eligible?
Landings have been calculated using the information we hold internally from electronic log books and FISH1 records, and this has been combined with vessel ownership records to enable the Scottish Government to identify those who are eligible. We have subsequently written to all eligible vessel owners to offer funding.
The landings figures you have recorded for my business don’t reflect the true number?
We are using recorded landings data which we have at a very granular level of detail for our analysis. If you have been recording and declaring your landings correctly then this should be reflected in the figures we hold. If you believe that your landings are higher than the figures we can consider this on a case by case basis.
What is the referrals / appeals process?
Fishing businesses can apply for consideration under the referrals process, whereby officials consider additional information supplied by vessel owners who didn’t appear to be immediately eligible for funding. Officials are working extremely hard to get through the referrals cases they have, which has been made more difficult due to the very high levels of correspondence they have been dealing with.
When will payments be made?
We have written to vessels eligible for the new scheme. Once application forms have been received, necessary checks have been carried out and information gathered, payments will be made within days.
How much will my grant be?
For those eligible an initial payment of 50% of two months’ average vessel earnings will be made. The grant payment will be equivalent to 50% of the average of each individual vessels earnings, covering 2 months initially.
For example a vessel whose average monthly earnings is £2,800 will receive a payment of £2,800 (£1,400 x 2) to cover two months. Payments will be capped at a maximum of £27,000 as we explore State Aid restrictions and where there are owners of multiple vessels.
Will I have to pay the money back?
It is our intention is that this fund will act as a grant. However, this is a fast moving environment with new support being announced day by day; if new streams of funding achieving the same outcomes are subsequently announced by the UK or Scottish Governments, then to allow us to redirect that money to other people in need elsewhere in the current emergency, we are likely to ask you to repay some or all of this grant.
I own more than one vessel. Can I claim multiple times?
Please note that one grant is provided per business. This means that if a business owns more than one vessel, or is the parent company of other companies that own vessels, that business is only eligible to apply once under this scheme.
The Scottish Government must comply with EU State Aid rules and as such must ensure the same undertaking is not funded multiple times. Businesses will be checked on Companies House to establish ownership.
Can I still fish?
Yes. This funding will see vital cash going to vulnerable fishing businesses as quickly as possible to avoid bankruptcies and enable fishers to continue to fish to even limited markets, especially here in the UK but keeping the vital supply of food continuing.
Can I land into local markets?
Yes. No special provision is required to enable vessels to supply local markets. The Register of Buyers and Sellers scheme is primarily used to cross check transactions such as direct supply of small quantities to local hotels and Bed and breakfasts. There is no onus on the buyer to do anything if the quantity purchased is below 25kg.
A one off payment will only last me a few weeks…what then?
The initial payments are being made quickly in order to manage the immediate hardship facing those vessels which have been identified as eligible. The Sea Fisheries Intervention Fund will act as a temporary support measure offering immediate hardship payments to businesses that cannot access the UK business grant scheme for land based operators and to take them to a point thereafter where they should begin to be in receipt of the self-employed payments expected in June.
Does having a second job mean I can’t claim?
The Scottish Government have identified those vessels under the most immediate pressure and who are at risk of failing because of COVID 19. The eligibility criteria used to identify these vessels are detailed below. It is important that this initial support goes to those who need it most and make a living wholly or predominantly from the sea. As a result only those fishing businesses with annual earnings above £20,000 will be eligible, which is a threshold we have used in previous schemes. Therefore having a second job would not automatically disqualify you from the scheme, as long as the criteria are met.
Will taking alternative employment during COVID impact my grant?
As long as any alternative employment is short-term and does not constitute a full time living, it should not affect payment of your grant.
Have you discussed the fund with industry representatives?
We have worked closely with industry representatives including SAFPO, CIFA, WIFA and SFF to identify the most vulnerable sectors requiring support.
What other support is available?
Some other packages of support from the Scottish and UK Government’s may help.
The Scottish Government has opened applications for a £100m package of additional grant support for small and medium sized businesses (SMEs) and newly self-employed people. Details of this and other additional support can be found on the Scottish Government’s new website www.FindBusinessSupport.gov.scot
If you require tailored advice you can also call the Scottish Government’s business helpline on 0300 303 0660. It is open Monday to Friday, 8.30am to 5.30pm. Select option 1 to speak to the HMRC self-employment Coronovirus helpline or option 5 to speak for general enquiries.
The UK Government has announced support for the self-employed who have been affected by the coronavirus. HMRC will identify eligible taxpayers and contact them directly with guidance on how to apply with payments expected from June.
Will more funding be announced?
We anticipate that there will be no further rounds of funding available directly to the fishing industry in Scotland to mitigate the economic impact of COVID-19, in advance of self-employment payments from the UK Government.
Why are wrasse vessels ineligible for funding?
Eligibility will only be for those who will suffer market failure or loss and not where alternative markets clearly remain.
We have excluded a number of vessels that fish for wrasse to support the aquaculture sector. Market and demand will remain for wrasse and may even increase.
What support is available to the whitefish sector?
Whitefish vessels will be able to access self-employed payments from the UK Government, which are expected to begin in June.
Why is there a minimum earning threshold of £20,000 to be eligible for support from the Sea Fisheries Intervention Fund?
The £20,000 threshold is intended to ensure that only full time fishers are eligible.
This threshold was initially developed in 2014 for the Scottish Creel Support Fund. The rationale was that, following costs associated with the vessel and fishing activities, the profits made on an income of less that £20,000 are unlikely to sustain a fishing business as a full-time occupation. It was therefore agreed by the Scottish Government and industry representatives that £20,000 was a fair cut-off for full-time fishers in 2014 and again in 2020.
Why is there a difference between the Scottish scheme and the schemes operational in NI, Wales and England?
Other administrations have chosen a threshold income of £10,000 to be eligible for support and this is a decision for them to make based on their own criteria and the specific nature of their fleets.
The Scottish Government has worked closely with industry representatives to identify the most vulnerable sectors requiring support. We have determined fund criteria based on the nature of Scotland’s fleet to enable us to support those whose markets have almost completely collapsed. In addition for the £9.5 million Sea Fisheries Intervention Fund which supports the shellfish sector, we have a £10 million assistance fund for seafood processors and have developed a hardship fund of £3 million to support shellfish growers and trout farmers in the aquaculture sector.
Does the money go to the owners/ crew/ skippers?
Funds will be paid directly to vessel owners. We expect owners to use this funding to support any crew as appropriate, taking into consideration the support in place for the self-employed.
I’m a new owner / only joined the fishery part way thought last year, so don’t meet the threshold. Can I appeal?
We acknowledge there are likely to be special cases where new owners joined the fishery part way through the year or changed vessels and we will deal with those on a case by case basis. The newly self-employed fund can provide one-off grants for those new entrants who are not eligible – further details can be obtained through your local authority via the website www.findbusinesssupport.gov.scot
I only fished part of 2019, due engine failure, ill health, breakdown, new vessel, etc. Will the method of calculating a payment work against me?
We will consider cases such as these on a case by case basis.
How will you take account of state aid limitations?
Payments will be capped at £27,000 to remain within the €30,000 State Aid limits. It is likely that there will be some flexibility agreed for State Aid in light of the situation we are in, however it is prudent to maintain this cap until State Aid processes are finalised and to provide a good buffer should this scheme be rolled over into future months.
A small number of vessels will be affected by this cap. We believe that those vessels impacted have enough cash resilience in their business to not immediately require support.
Do I need to comply with social distancing rules on board?
The Scottish Governments most up to date advice:
https://www.gov.scot/publications/coronavirus-covid-19-business-and-social-distancing-guidance/ clearly states that Food is part of the Critical National Infrastructure (CNI) but not everyone and everything within a sector is deemed “critical”. Shellfish and sea fishing is clearly a key element of the food chain and therefore falls under this definition of CNI.
But all businesses also need to consider a key set of questions – and at all times work on the precautionary basis.
- Is what you do essential or material to the effort against the virus or to the wellbeing of society?
- if so, can your staff work from home?
- if not can you practise safe social distancing and comply with ALL other standard health and safety requirements.
The government guidance is clear that if the answer to none of these questions is yes, then you should close. However, for those fishing businesses who do feel they can answer yes to at least the 3rd question, then they need to ensure safe social distancing which is 2m distance between employees – that may involve changing the business model and approach.
However in the event that businesses consider they can still operate safely, there are other clear considerations and actions they should take.
- Travel to and from the vessel should be done in accordance with social distancing advice.
- 2 metre separations should be maintained as rigorously as is practically possible.
- Vessel operators should have a critical assessment of operations and ensure only the bare safe minimum of critical crew for operations are together on-board. This may result in shorter trips, different fishing grounds or other considerations you see fit to enable changed working practices.
- There is neither a compulsion to go to Sea nor is there one to tie up. You must review your business operation and make the best decisions for you and the safety of your crew.
This is the most up to date advice but given these fast moving times is subject to change and adjustment. But what will not change is the priority issue at the heart of the government’s guidance and requirements of all businesses – please help us to protect people’s lives. And if you cannot operate your business with as much confidence as possible that you are not putting people’s lives at risk from coronavirus, then you should close.