"the Act of 1993" means the Crofters (Scotland) Act 1993;

"approved" means approved by the Scottish Ministers in writing and "approve" and "approval" shall be construed accordingly;

"crofter" includes any grazings committee or grazings constable appointed under section 47 of the Act of 1993 and in the application of this Scheme to a grazings committee or a grazings constable any reference to a croft shall be construed as a reference to the common grazings for the management of which the committee or, as the case may be, the grazings constable is responsible;

"eligible occupier" means–

(a) the occupier of a croft who is also the owner thereof and who in the opinion of the Scottish Ministers is of substantially the same economic status as a crofter;

(b) the occupier of a holding, other than a croft, situated in the crofting counties which is either a holding of which the area does not exceed 30 hectares (exclusive of any common pasture or grazing held therewith) or a holding the annual rent of which, if it were a croft let to a crofter under the Act of 1993, would not, in the opinion of the Scottish Ministers, exceed £100, being an occupier who in the opinion of the Scottish Ministers is of substantially the same economic status as a crofter; or

(c) the occupier of a holding, other than a croft, situated in the crofting counties which exceeds 30 hectares (exclusive of any common pasture or grazing held therewith) and of which the annual rent, if it were a croft so let, would in the opinion of the Scottish Ministers not be substantially larger than 30 hectares (exclusive of any common pasture or grazing held therewith) or is capable of being so let at an annual rent not substantially in excess of £100, being an occupier who in the opinion of the Scottish Ministers is of substantially the same economic status as a crofter; or

(d) the sub tenant of a croft or part of a croft occupying under a sub lease granted by a crofter with the written consent of the Crofters Commission under section 27(2) of the Act of 1993 and in accordance with any conditions imposed by it under section 27(5) of that Act;

"Less Favoured Area" means the land shown coloured in blue or in pink on the designated maps–

(a) to reduce production costs;

(b) to improve and redeploy production;

(c) to increase quality;

(d) to preserve and improve the natural environment, hygiene conditions and animal welfare standards;

(e) to promote the diversification of agricultural activities

in the case of a crofter or on behalf of a crofter, on the croft and, in the case of an eligible occupier, on the croft or holding or part of a croft, as the case may be, occupied by that eligible occupier.

    (2) The Scottish Ministers may determine in each financial year the amount of grant payable–

(a) nationally;

(b) for specific areas as determined by the Scottish Ministers; or

(c) for specific activities as defined by the Scottish Ministers.

    (3) The Scottish Ministers may refuse an application for grant solely on the grounds that to approve that application would result in the amount determined under paragraph (2) nationally, for the specific area or for the specific activity being exceeded.

    (4) For the purpose of this paragraph, "approved cost" shall mean the cost approved for the purposes of a grant under this Part of this Scheme and comprising the aggregate of–

(a) the expenditure reasonably incurred by the crofter or eligible occupier in respect of materials required for the purpose of carrying out the relevant operation; and

(b) such other sum as the Scottish Ministers may deem reasonable.

(a) under paragraph 4(2) of this Scheme, or paragraph 3 of the Schedule to this Scheme, in relation to the approval of the cost of an operation;

(b) under paragraph 4(1) of this Scheme, or paragraph 9(2), or paragraph 3 of the Schedule to this Scheme, in relation to a grant; or

(c) under paragraph 12 of this Scheme in relation to an instalment of grant,

they may recover from the applicant the amount of the grant or of the instalment of the grant paid to the applicant or such part thereof as they may in all the circumstances consider reasonable in like manner as if it were a debt due by the applicant to them.

    (2) The Scottish Ministers may terminate an award of grant under paragraph 8 of this Scheme and if they do so, they may also prohibit the applicant from submitting any new grant application for such period from the date of termination as the Scottish Ministers may specify.

    (3) The powers conferred on the Scottish Ministers by sub-paragraphs (1) and (2) shall be exercisable by a notice served on the applicant by post at his last known address and in sub-paragraph (2), "specify" means specify in such notice.

    (4)

(a) Where the Scottish Ministers exercise the power to recover conferred by this paragraph of this Scheme they may also recover on demand interest on the sum to be recovered at a rate of interest one per centum above the sterling three month London interbank offered rate on a day to day basis from the date of payment until the date of recovery.

(b) In any proceedings for recovery under this Scheme, a certificate issued by the Scottish Ministers stating the rate or rates of interest, the amount of such interest recoverable and the period for which such interest is calculated, shall unless the contrary is shown, be conclusive of those matters.

(a) in respect of specified operations carried out by them for the purpose of aiding and developing agricultural production on crofts or holdings (paragraphs 3–7 and the Schedule); and

(b) in respect of contributions made by them under such agreements as are referred to in section 47 of the Roads (Scotland) Act 1984 towards the expenses of providing cattle grids for the said purpose (paragraphs 8–10).

This Scheme differs from the 1998 Scheme in that it sets grant rates at 50% in Less Favoured Areas and 40% in other areas of the Crofting Counties. It also provides that the maximum amount of grant is £25,000 for an individual and £125,000 for groups of individuals, in any two year period.

All applications have to be made and approved before work on the project commences and the Scottish Ministers have been given the power to specify in approvals of Schemes the relevant dates by which work may start and grant payments may be claimed.

The Scottish Ministers are given the additional power to set budgets nationally or for specific activities and also the power to refuse applications if the national or specific activity budget limit has been reached.