A cattle health scheme, which begins recruiting this week, could provide farmers in northern Scotland with an extra £4.2 million (pounds) a year, helping to reverse a decline in the number of cattle producers in the area.

The HI-Health initiative, which will be open to all cattle farmers in the Highlands and Islands area, aims to attract 2,500 members and improve the quality of their livestock through the adoption of an agreed health programme, improved disease awareness and targeted marketing.

The HI-Health project will cost £780,000 (pounds) over the next five years. Investment of £371,000 (pounds) is coming from an aid programme administered by Highlands and Islands Enterprise (HIE) and the balance will be privately financed through producers subscriptions.

Beef and dairy production already accounts for some 55 per cent of the Highlands and Islands agricultural output and field trials have shown that increased livestock health could boost yields by a further 17 per cent, through improved fertility, reduced calf losses, weight gains in beef cattle and improved milk production in dairy herds. Better livestock health also reduces the costs involved in treating disease.

This increase in farm output and incomes will help address the difficulties caused by BSE and the export ban on British beef, which led to changes in the market-place. Consumers and retailers are increasingly looking to see that animals have been raised, slaughtered and processed to a high standard.

Other European countries are also making good progress towards disease eradication and high health-status herds and, to be competitive when the beef ban is properly removed, British producers will have to demonstrate similar advances. Disease eradication could also reduce the threat of future trade bans.

HIE will invest the public sector funding under the Highlands and Islands Agriculture Programme (HIAP), which is funded by the Scottish Executive Rural Affairs Department (SERAD) and the European Union. After five years, HI-Health is hoped to be self-supporting.

HI-Health Ltd. will operate as an umbrella organisation, working with local livestock assurance schemes, such as those in Shetland and Orkney, and supporting the creation of others.

Mike Burnett has been appointed as programme co-ordinator, his tasks will include; promoting the concept of improved livestock health; developing an education pack for producers; setting rules and standards for HI-Health membership; establishing a database of members' herds; and developing the market for health-accredited stock.

He said: "Highlands and Islands cattle producers have gone through an extremely difficult period. In what appears to be an improving situation, this initiative ultimately offers them the chance to take advantage of verifiable health status to exploit new market opportunities."

HIAP manager Rob Clark said: "To maintain competitiveness and consumer confidence in the years ahead initiatives like HI-Health will become increasingly important. We know the produce of the Highlands and Islands is of a very high quality - but in the future we'll need to be able to prove it.

"Agriculture plays an important role in the economy and communities of the Highlands and Islands and this type of initiative will help maintain that contribution."

Leaflets promoting the HI-Health scheme will begin going out to all cattle farmers in the Highlands and Islands this week, through the co-operation of the area's veterinary practices.