16 Mar 2021
Forestry loan to help small scale woodland projects
A new loan scheme aimed at supporting small scale woodland creation projects has been launched today by Rural Economy Secretary Fergus Ewing.
Under the Small Woodlands Loan Scheme, half of the upfront costs associated with planting a new woodland, including buying trees, ground preparation or fencing, can now be paid in advance by Scottish Forestry.
The aim is to remove any cash flow barriers that crofters, farmers, or any other small woodland owner might have when considering tree planting.
The new loan works alongside the existing main Forestry Grant Scheme and is aimed at woodland creation projects up to 20 hectares in size.
Launching the new funding support at a meeting with the Scottish Crofting Federation, Mr Ewing said:
“There is significant interest in tree planting from smaller woodland owners, crofters and farmers. At the moment almost 200 of the 320 woodland creation schemes that are being funded by Scottish Forestry are for smaller projects.
“I have listened carefully to feedback which has suggested that many smaller scale land managers are worried about the upfront costs in getting trees in the ground. The new Small Woodlands Loan Scheme aims to help remedy this and give a helping hand to assist with the costs of starting a woodland project.
“We are on track to meet our tree planting targets this year. This new funding arrangement should give further confidence to the smaller businesses who want to get trees in the ground and help us deliver future planting targets.”
“This is a very practical measure,” said Donald MacKinnon, chair of the Scottish Crofting Federation.
“We have been asking for a loan element to crofting grant schemes to ease cash-flow, as this is always a problem for crofters, especially young folk. A grant is very generous but can be impossible to utilise without up-front funding.
“It is gratifying to see this element included in the woodland scheme, which crofters are keen to use. Crofters want to plant trees and contribute to the national targets that will help alleviate climate change. This will go a long way to helping that happen.”
The 50 per cent advance payment is directly linked to the ‘capital grant operations’ which each individual applicant will have detailed in their Forestry Grant Scheme Contract.
The payment will be provided once the applicant has an approved Forestry Grant Scheme woodland creation contract and associated Loan Agreement in place.
Further details of the Small Woodlands Loan Scheme is available here.