Funding Woodland Creation and Management in Scotland

Scotland’s woodlands and forests are a vital national resource, helping to reduce the impact of climate change and contributing to sustainable land use. The Forestry Grant Scheme (FGS) offers funding for both creating new woodlands and managing existing ones, aligned with Scottish Government environmental and rural development goals.

The Forestry Grant Scheme will support:

• The creation of new woodlands – contributing towards the Scottish Government target of 18,000 hectares of new woodlands per year from 2024/25.
• The sustainable management of existing woodlands.

The FGS budget for 2025 has been set at £53 million, reflecting a welcome increase from £45.4 million in 2024. While this uplift helps ease pressure on the sector, funding remains below the £74.2 million allocated in 2023.

Woodland Creation

The aim of this category is to support the creation of new woodland that will bring economic, environmental and social benefits. There are nine options to choose from in this category, with only one option – native broadleaves – being area restricted to the Northen and Western Isles. The options include:

• Conifer
• Diverse Conifer
• Broadleaves
• Native Scots Pine
• Native Upland Birch
• Native Broadleaves
• Native Low Density
• Small or Farm Woodland
• Northern and Western Isles

The small or farm woodland option, allows for a mixture of productive conifer/ broadleaves species in small block down to 0.25 ha but not sitka spruce. All FGS woodland creation options allow you to claim Basic Payment up until 2027 on land converted to forestry. Its future replacement may be paid for the remainer of the 20-year contract for the woodland creation grant but this has not been confirmed by Scottish Government.

Agroforestry

The two options in this category support creation of agroforestry systems on agricultural pasture or arable land. This will allow for an integrated approach to land management where there is a mix of trees on grazing or arable land.

Each option relates to how many trees you want to plant:

• 300-400 trees per hectare.
• 150-200 trees per hectare.

The grant rate for 150-200 trees per ha is £2,790/ha or £5,400/ha for 300 – 400 trees per ha. Planting is protected by weld mesh guards. Agricultural land grade should be up to grade 4.2. The grant rate was increased by 50% in 2023 with more flexibility on species choice also being added. The grant is designed to be a contribution and will not cover the cost of the works. The Forestry Grant Contract is for a period of 20 years.

Woodland Improvement Grant (WIG)

These aim to support forest management, activity to enhance the environment and the public’s enjoyment of existing woodlands. WIG grants are split in three subcategories Capital items, Planning and Restructuring.

Capital Items are split into, habitats and species, Low Impact Silvicultural Systems (LISS) and Woods in and Around Town (WIAT). Habitat and species will likely be the most interesting to private landowners but to have the desired score the proposals need to be in a designated site such as a Site of Special Scientific Interest (SSSI) however by claiming one of the Sustainable Management of Forests (SMF) options this allows you to claim some of these capital times at a lower score. This funds scrub removal, new fences, stock bridges and water troughs. Low Impact Silvicultural Systems is associated with changing forests to continuous cover which has a great following but little practical use. The final category is for Woods in and Around Town, this gives grants to woodlands within 1 km around settlements with a population centre of 2,000 people or more, most associated with new paths or upgrades but also can include thinning and remove of non-native scrub. 

Planning grants are associated with generally large woodlands over 100 ha and so are typically not useful for your average farm. However, a Woodland Grazing Management Plan is available and required if you intend to apply for the SMF grant under the Woodland Grazing option. Restructuring pays for replanting on areas that have been felled, £300 or £550 per ha, a woodland management plan is required to be in place for this grant and so areas less than 5 ha it might not be worth going for these grants.

Sustainable Management of Forests (SMF)

These grants are typically paid on a per hectare base for a period of up to five years. The grants are claimed as part of IACS submission, some do require additional information to be sent to Scottish Forestry before the grant will be paid out. These options aim to support the management of existing forests and woodland through several options including livestock exclusion and woodland grazing where you improve or enhance the condition of the native woodland. Both these options if successful allows you through a back door into the WIG Grant above for capital items such as fencing and scrub control.

Tree Health

This supports the protection of woodland from the impacts of non-routine tree pests or diseases. Generally, associated were Statutory Plant Health Notice (SPHN) has been served on a landowner.

Activity supported includes:

• The provision of competent agents' services.
• Tree removal of relevant tree or host species.
• Replacement planting.

Forest Infrastructure

This category supports forest access in small-scale or undermanaged woodlands. If you have a woodland under 50ha and you wish to bring it under management or an inaccessible woodland back into management or woodlands up to 100 ha could be considered when the woodland is considered native, then you can apply for a capital items grant for the construction of a road up to a maximum of 1,500 metres per application and construction of turning areas. These items are paid for by a fixed rate of £25.8 per metre for the road or £6.60 per square metre for the turning area.

Alternatively, if you are looking at creating a new woodland and you are an upland livestock farmer with sheep then you can also claim new road 30 metres per ha up to 1,500 metres along with turning areas.

Harvesting and Processing

This category supports the development of the small-scale premium softwood and hardwood processing sector. It is for the purchase of forestry equipment, excluding tractors and chippers, paid up to 40% of the product up to the value of £50k under Aim 1, for harvesting and primary processing equipment such as firewood log processor or purpose-built forestry trailer or small-scale mobile mills. Secondary processing equipment paid up to 40% value up to £50k under Aim 2 equipment such as fencing equipment. Applications close on the 30 January each year.

Forestry Co-operation

This category supports key ‘landscape scale’ projects involving several landowners, to encourage landscape scale collaborative projects between two or more landowners by providing project facilitation and co-ordination. Grant support is paid at £250 per day up to 40 days or up to 10 days for small-scale less than 10 ha woodland creation schemes.

5 Top Tips

• Use the FAS specialist advice for woodland management and conservation. There is up to £1600 grant support available for an advisor to help you prepare a report either existing woodland or new proposed woodland.
• For help and support with Forestry Grant Schemes refer to ruralpayments.org or contact your local advisor.
• For the Sustainable Management of Forests ensure all capital items are claimed for as you cannot claim later for items you may have missed.
• All applications for FGS submitted from 1 April 2024 must adhere to Scottish Government’s approach to the Fair Work First (FWF) conditionality.
• Please allow up to four weeks before the deadline of 30 January for help from an agent for processing the Harvesting and Processing Grant.

David Eadie, Forestry Consultant, David.Eadie@sac.co.uk

Unearthed is the exclusive SAC Consulting members' monthly newsletter. Unearthed offers insights and tips from our experts on what we think is in store for farming and crofting in the coming months in order to protect and enhance your business.

Posted by Unearthed News on 17/06/2025