The government has committed to maintain the farming budget for England at £2.4 billion per year throughout this parliament. This was confirmed again in the recent Spending Review.
Currently, most of the farming budget is spent on Basic Payments – subsidies paid to farmers according to how much land they farm. We will be gradually reducing spending on Basic Payments each year over the next 6 years.
Instead, we will make the money available to farmers through one-off grants for capital investment in equipment and technology, and ongoing payments for environmental actions and related advice and support. Farmers will be able to get paid for a combination of actions that they choose, to suit their farm business, food production and the environment.
We’ll achieve this by:
- allocating the budget flexibly to respond to demand, and achieve our intended outcomes for farm productivity, environment, climate and animal health and welfare
- designing schemes to make them accessible and workable for all farmers so that there is a range of choices that works for everyone
Allocating the budget
We set out in the update on the Agricultural Transition Plan last June our high-level plans to spend the money freed up from Direct Payments.
We will not have fixed allocations (or ‘pillars’, as they were known whilst we were in the EU) of money ring fenced to different schemes. Instead, we will learn as we go and find the best ways to manage the overall budget to respond to demand in a way that helps us achieve our intended outcomes. This means we will keep the allocation of funding between different schemes under review over time.
We are already seeing plenty of farmer enthusiasm and action to protect and improve the environment as part of profitable, commercial food producing businesses. We have adjusted our plans to follow increased demand for particular schemes and actions. For example, we have increased our budget for Countryside Stewardship to reflect the recent price increase for most options and the 40% increase in applications we saw last year, so that everyone who applied could join the scheme. We also increased our budget for the new Farming Equipment and Technology Fund to meet demand 3 times higher than our initial budget allocation, so that more than 4,000 farmers could invest in new equipment and technology for their farm business. We will maintain this flexible approach.
There is no gap between taking the money out of Direct Payments and it going back into the sector. Right now, farmers not already in Countryside Stewardship can apply for an agreement to start in January. We have already had our first rounds of the Farming Investment Fund and we’ve just closed the first round of applications for Landscape Recovery projects. The Farming in Protected Landscapes scheme is funding a range of activities on farms in national parks and Areas of Outstanding Natural Beauty (AONBs). We will shortly launch the first iteration of the Sustainable Farming Incentive.
Over the next 3 years (the period covered by the recent government Spending Review), as we reduce Basic Payments we will incrementally roll out the new range of grants and ongoing payments.
We plan to spend the farming budget over the next 3 years as follows:
- We will continue to gradually phase out subsidies but reallocate all of the funding to maintain the same overall level of investment in the sector.
- We will spend more than £2.5 billion on the new Sustainable Farming Incentive, Countryside Stewardship and its successor, Local Nature Recovery, and continue to fund existing Environmental Stewardship agreements. We will also spend a small proportion of this budget through the Farming in Protected Landscapes scheme.
- We expect to spend around £600 million on grants and other support for farmers to invest in productivity, innovation, research and development.
- We will spend up to £50 million from the farming budget on Landscape Recovery projects (longer-term, larger-scale projects). Landscape Recovery is for those who want to take a more radical, large-scale approach to environmental land management. Farmers are eligible for this scheme, and a key objective for the first round of projects is to test how well the scheme is working for farmers and groups of smaller farms. Round one applications recently closed and most of the 51 bids received are for projects involving groups of farmers and land managers working together. We committed to take forward up to 15 projects in this round, and the learning from it will help us make decisions in future about what proportion of the budget should be allocated to this scheme.
- Over this period most of the government funding for landscape-scale activities will be through the separately funded Nature for Climate Fund. Farmers can apply and are applying for these two offers, and we are ensuring scheme design continues to support that.
- Scheme administration costs are funded separately, other than continuing to have a ‘technical assistance’ pot which amounts to less than 1% to 2% of the total budget each year.
Making schemes work for all farm types, sizes, locations and tenancies
We are working with farmers and other experts to design all our new schemes to be accessible to and workable for all farm types, tenancies, sizes and locations.
For example, in the Sustainable Farming Incentive, we’ve:
- Made the scheme standards flexible, rather than providing detailed and rigid prescriptions, so that farmers can decide how best to meet the standards on their farms
- Matched that flexibility with a more proportionate and fair set of controls, designed to support farmers to meet the requirements of the scheme but still be effective in responding to the rare cases where there is deliberate / persistent fraud or non-compliance (we’ve also changed the rules in existing schemes to introduce fairer controls and changed the way we do farm visits)
- Re-balanced the terms and conditions to make them fairer and more workable for farmers
- Put in place shorter agreement lengths (3 years rather than 5) and provided extra flexibility so that people can add more land, standards and levels of ambition into their agreement each year and so that tenants, including those on 1-year rolling contracts, can come into the scheme and leave early without penalty if they lose management control of their land
- Made the scheme administration simpler, clearer and faster so that farmers can self-serve and apply at a time that makes sense for them rather than during a fixed application window, and we can process applications and payments quickly, consistently and reliably
We will be looking to apply similar flexibility, fairness and reliability to the design of all our schemes.
We know that farmers need to know how all the schemes will work for them and what funding they will be able to access. We will be publishing more information over the course of this year about this so that farmers can plan ahead.
The Sustainable Farming Incentive offer this year is just the opening offer – we will be expanding the scheme to cover a wider range of actions and levels of ambition over the next 3 years and we’ll publish further details about this later this year.
We’ll be sharing more details this year on how Local Nature Recovery will work for farmers and what sorts of actions it will pay for, and how those in existing agreements will be able to transition smoothly onto the new schemes when they’re ready.
Meanwhile we’d encourage any farmer not already in Countryside Stewardship to take a look at the scheme before this year’s application deadline, along with other schemes currently on offer, including Farming in Protected Landscapes, the England Woodland Creation Offer (where you can be funded for planting and maintaining woodland over as little as 1 hectare of land) and our productivity and innovation, research and development grants.
9 comments
Comment by Helen Wordley posted on
Thank you - always very informative 🙂
We are in the SFI Pilot and it's good to hear that the scheme will be expanded to embrace a wider range of actions. We would have liked to include within the scheme a woodland creation on a smaller land parcel that EWCO are able to offer and there are a number of items in the Countryside stewardship offer such as wild flower meadows which we would have loved to develop.
Comment by Tom Meikle posted on
All talk no action. You say you want fairness ,flexibility available for all size farms. why then are HLS payments not the same as CS Mid tier.My HLS finishes in July no flexibility or continuity in allowing it to continue to January. I get £100 for school visit, under CS I would get £300 for the same visit. I invested 24K in a new more efficent pump and control box for my irrigation system. This was a large outlay for a small farm, the minium out lay to be eligable for grant was over 80k,no fairness there. But i could get a new weather stationfor 3k when all i have to do is turn on the ten oclock news.You been talking about ELMS since 2016!!. The people at the RPA know nothing about conservation but are happy to refuse a small farmer payment because of their own failings.
Comment by The Team posted on
Hi Tom,
Thank you for your comment about the Higher Level Stewardship (HLS) and Countryside Stewardship (HLS) schemes.
HLS agreements that are due to expire by December 2022 will be offered a 1-year extension if they are eligible and continue to deliver environmental benefits. We have recently introduced legislation that will allow us to offer longer-term extensions for existing HLS agreement holders. From 1st July 2023, we intend to offer existing and eligible HLS agreement holders an extension of up to 5 years if they continue to deliver for the environment, and have written to all HLS agreement holders to highlight our proposals.
Payments for HLS agreements are administered on a whole-farm basis, and are underpinned by the Entry Level Scheme (ELS) payments, whereas the CS scheme was designed to have more targeted payments within this underpinning. For these reasons, payments for HLS and CS agreements are not directly comparable.
Best wishes,
The Team
Comment by Julia Aglionby posted on
Can you please offer advice to farmers already in Countryside Stewardship.
How can they access monies released from BPS when they cannot be in CS twice and their land in CS is not eligible for SFI?
These are the farms who've been committed to delivering public goods for many years and appear to be being disadvantaged by transitional arrangements?
Comment by The Team posted on
Hello Julia,
Thank you for visiting the blog and apologies for the delay. Throughout the transition we’re aiming to provide a range of choices for all farmers.
In the first year of the transition, we used some of the money released from BPS to update the prices in CS agreements from 1 January 2022 - for those in existing agreements there were no reductions in any prices and most prices increased.
Those in existing agreements will be able to transfer over to new environmental land management schemes once they are fully rolled out (after 2024/25).
In the meantime, we’re making it straightforward for anyone in existing schemes to enter into SFI alongside their CS or ES agreement, so long as we’re not paying for the same actions twice and so long as the actions are compatible – this is because it would not be fair, or good value for public money, to pay some people twice for the same actions, but not others who don’t happen to be in both schemes.
We’ve designed our SFI application service to make it easy for you to see which parts of your land are eligible for SFI on that basis.
We will add more standards to SFI over the next 3 years, as set out in this post: https://defrafarming.blog.gov.uk/2021/12/06/how-the-sustainable-farming-incentive-will-develop/
Farmers will be able to continue adding in more SFI standards, land and levels of ambition over time, alongside any existing agreements.
A range of other payments is available and on the way, including:
One-off payments to support farm productivity, animal health and welfare, slurry management and environmental features
For those in protected landscapes, there are payments available to support environment, heritage and access. https://defrafarming.blog.gov.uk/2021/06/24/farming-in-protected-landscapes-opens-in-july/
Later this year, we’ll start paying farmers so they can have a free vet visit, annual health and welfare review and testing for endemic diseases https://defrafarming.blog.gov.uk/2021/10/05/introducing-the-annual-health-and-welfare-review/.
These are designed to give farmers information and advice to help improve animal health and welfare which can, in turn, improve farm productivity.
We are providing free business planning advice, from expert organisations – we have completed the first 2 rounds of funding for this work, and are about to open up the third and final round in October. https://defrafarming.blog.gov.uk/2022/07/14/free-business-advice-next-phase-to-start-in-october/
Best wishes,
The Team
Comment by Richard Styles posted on
As a small family farm producing basic food products that others make into a finished product, like bread and sugar. There is nothing in these schemes that we can apply for. We are in Countryside Stewardship, have been offered a mirror agreement, but do not yet know when this will be 'approved' by the RPA. British Sugar want our area declaration by August this year. When will the RPA give us the green light so we know how to plan? We need to know now!
I have developed a new oilseed rape drill, There was no help from the RPA with this venture as it fell out of their scope for funding. Wonderful.
RS
Comment by The Team posted on
Thanks for the feedback, Richard.
If you could please email your SBI to Sandy Kapila, the RPA’s Customer Director (sandy.kapila@rpa.gov.uk), he’ll check progress on the CS agreement extension. In terms of FETF we understand that the scope of items wasn’t right for everyone and we are considering options for future rounds.
Comment by Robert posted on
There are lots of young people who rent parcels of land for a start on the ladder and claim nothing and cannot get anything because they claim nothing.
Surely these people are worth the help as well.
Comment by The Team posted on
Hi Robert,
We know it’s hard to get started in farming. That’s why we’ll soon introduce a support scheme for new entrants (that is, newcomers to the industry – not necessarily young people). You can find out more about our plans by reading this post about new entrants: https://defrafarming.blog.gov.uk/2022/06/01/a-fresh-start-for-new-entrants/
We'll share updates on the scheme here on the blog, so do subscribe.
Best wishes,
The Team