How much will it cost to pay farmers to deliver public goods?

CLA's Senior Land Use Policy Adviser, Harry Greenfield, on new research by RSPB, the Wildlife Trusts and National Trust on a new model for farm payments.

Much of my time at work is spent thinking about the Government’s proposed new Environmental Land Management (ELM) scheme and about two big questions in particular. First is how the scheme will be designed, and the CLA continues to lobby for a well-designed system that works for land managers, based on ideas in our Land Management Contract.

But the second big question is over funding: how much will be in the pot, what will it be spent on, and how to make the case, to the Treasury and the taxpayer, for public funding for environmental land management?

A new piece of research published this week helps us to answer that second question. Commissioned by three environmental NGOs (RSPB, National Trust and Wildlife Trusts), the research set out to answer the question “How much will it cost and how might we pay farmers and land managers to help to deliver the UK’s existing environmental land management priorities?”

The resulting report looks at the range of environmental commitments the Government has made that will be delivered through land management, such as the management of boundary features and priority wildlife habitats and climate change adaptation and mitigation measures. The research suggests an annual cost of £2.9 billion to pay for this beneficial management and change in land use.

This figure importantly also includes the provision of expert advice, something that the CLA has long argued will be needed to support a shift towards more, and better quality, environmental land management.

The research also looks at how to pay for public benefits produced on “high nature value” farms, many in the uplands, which are often economically marginal. Their low profitability means that any environmental payment based on costs incurred and income foregone will be very low. In order to continue delivering important environmental benefits, the report suggests using a broader definition of costs to include those underpinning the farming operation. In other words, these farms would be paid a sum that covers both the environmental public goods they deliver and supports the farming operation too.

Notably the £2.9 billion figure only covers the cost of environmental land management, without accounting for any additional public investment in the agriculture sector. The CLA has recently argued for a £200 million annual investment in productivity improvements during transition from direct payments. This investment will be vital to help farmers and land managers navigate the transition away from the Common Agriculture Policy (CAP) and the loss of direct payments.

This figure is very close to the £3.2 billion currently spent annually through the CAP. When additional productivity investment, not to mention support for climate change adaptation and mitigation, are factored in, this means we are facing a need to invest at least as much, if not more, in farming, forestry and land management as we currently do.

While there may still be some lively debates to come between farmers and conservationists over the design of ELM, on the need for significant investment in environmental land management we can speak loudly and with one voice.

Read our media response to the report.