Defra finally firms up post-Brexit farming payments for nature

Farming Minister Mark Spencer has confirmed at the Oxford Farming Conference today (5 January) that the Government has concluded its review of post-Brexit subsidies for those working in agriculture. The review was due to wrap up late last year but delays ensued amid two consecutive changes in Prime Minister.

Chief among the aims of the review were firming up plans for farmer payments for nature conservation and restoration, and the need to provide farmers with more clarity about the Government’s plans to support them through the current cost crisis that is impacting energy, fertilizer and other commodities. Inflation in the agriculture sector is estimated to be at around 23%.

Spencer confirmed that the Department for Food, the Environment and Rural Affairs (Defra) will begin making payments under its new Sustainable Farming Incentive (SFI) every quarter rather than ever year. The SFI has been created to pay farmers for ‘common goods’ – not only their products, but the value they can preserve and create in nature. It has begun with payments for maintaining or improving soil quality and will, in time, be expanded to cover water, biodiversity and other metrics.

Spencer told farmers that the move will “support cashflow, rather than adding to challenges” for farmers. He highlighted that tenant farmers can now bypass landlord consent and apply for shorter contracts than the original minimum of five years.

Also on the SFI, Spencer confirmed an additional payment of £20 for the first 50 hectares, backdated to June 2022. The maximum increase available to each applicant is, therefore, £1,000 per year.

Another payment boost was confirmed for those using the Countryside Stewardship (CS) scheme. This scheme is open to foresters and land managers as well as farmers, providing incentives for environmental protection and enhancement. Spencer confirmed an average revenue payment increase of 10%. Capital payments under CS, for one-off projects, are also to receive an uplift, of an average of 48% per applicant.

Industry reaction

Spencer called the increases, combined, “a good offer” that “makes the best use of Defra’s available budget and new flexibilities”.

But the Country Land and Business Association, representing some 30,000 landowners and businesses, has said that details are still being provided too slowly, with farmers unsure of their economic outlook this year – let alone their long-term role in nature restoration.

The Association’s president Mark Tufnell said: “We believe The Government’s policy on environmental land management schemes to be potentially world-leading, but we need a world-leading government operation to underpin it. Defra is doing good work, they just need to do it more quickly.”

The NFU’s vice-president, David Exwood, has similarly stated that “while some of these latest changes are welcome … it risks being too little too late, especially given the current economic challenges we are experiencing, and the rapid erosion of direct payments” under the previous regime.

The NFU caused a stir last year by saying that it would support then-Prime Minister Liz Truss’s proposal to scrap some of the facets of its subsidy schemes that would see farmers compensated for environmental stewardship.

As farming groups question whether their members will see financial relief this year, green groups are far from impressed about whether the increased payments will lead to better environmental outcomes.

The Wildlife Trusts’ chief executive Craig Bennett said in a statement:  “Farmers need much more support to adapt to climate change – they need stronger incentives to do the right thing – but today’s announcement will mean less money for meaningful action.

“If the Government had included handsome rewards for farmers to move away from pesticides through integrated pest management, for example, you’d have more businesses attracted to the schemes. But instead we’re seeing more money put into the least effective strand of the scheme that will deliver the smallest amount of public benefits – to the detriment of the most ambitious elements.”

The Government has committed to leaving nature in a better state for the next generation but, according to its own independent environmental watchdog, is nowhere near on track to delivering this ambition.

Teething problems?

Spencer dedicated much of his time speaking at the Conference today to arguing that the new subsidy schemes are easy to apply for, in the wake of news that just 224 applicants received payments in 2022. This figure was revealed by the Guardian this week following a Freedom of Information (FOI) request.

“Farmers have told us they they’ve applied in 20 minutes flat, as straightforward as ordering something from an online shop,” he said. “You’ll get your agreement within 2 weeks – often much quicker. Start your agreement the next month and you should start getting paid 3 months later.”

Spencer also said that inspections conducted ahead of, and during, subsidy claims will be “pragmatic and helpful” rather than an excuse to impose fines.