An update on Sustainable Farming Incentive applications

The Rural Payments Agency has announced that SFI applications that have been started but not submitted by 31 December will be removed
Farmland in heavy frost

Sustainable Farming Incentive (SFI) applications that have been started but not submitted by 31 December will be removed from the system, the Rural Payments Agency (RPA) announced this week.

In the announcement on 13 December, the RPA said that this would enable it to update the system so that applications can be submitted in 2024. The system will not permit new applications to be started between 27 December and 2 January 2024, though applications that have been started before the 27 can be submitted up to 31 December.

Those who have started an application but do not submit it before 31 December will have to start a new application from 2 January.

This unexpected announcement should not cause an issue for those who have started an application before 27 December and submit it by 31 December. Applications only need to have been submitted by 31 December, and the agreement offer does not need to have been accepted.

However, the change risks frustrating those who have invested time in applications and are unable to submit by the 31 December deadline. There are around 7,600 applications that have been started but not submitted. Those in this group will fall into different categories, including those who have started an application to test the process but have no plans to apply imminently. Others will be eager to submit but are awaiting RPA clarification on various matters before submitting an application.

CLA analysis

The clear message is that members who have spent considerable time and effort on a partially completed application should submit their applications as soon as possible. For more complex, larger-scale applications, there is a reasonable chance that clarification from the RPA will be needed on various aspects of the application before submission. Therefore, there is all the more reason to progress the application sooner rather than later.

Some applicants may feel a particular urgency to submit an application to secure an SFI agreement and quarterly payments. One option could be to exclude problem parcels that are unresolved and add these to their SFI agreement at a later date.

Some applicants will be unable to submit their applications before the 31 December deadline but will be eager to take steps to ensure that their work is not lost. The RPA is unable to offer assistance on this, but a possible workaround is to submit the partially completed agreement and reject the offer that comes back. This should work for the majority of scenarios and will at least enable applicants to download the agreement documents without necessarily accepting it.

Wider SFI analysis

The application numbers have been building in recent months, with around 4,600 submitted applications and 2,500 live agreements. On average, there are 15 days between applications being started and being submitted. SFI applications are being processed much more quickly than Countryside Stewardship, with some agreements being offered within two weeks of the application, though others are taking longer. 70% of agreements are processed without issue, and 30% require checks.

One of the positive elements of the SFI is the rolling application window. While this gives more flexibility than previous schemes, it has generated additional consideration when it comes to looking at how cropping rotations slot into a three-year SFI agreement, which can start at any time of the year. Many options allow the applicant to include existing options (such as winter cover crops) that are in place before the SFI agreement starts, but are not being funded by another scheme. For these options, applicants have the opportunity to complete a backward-looking application (funding what is already in situ before the agreement begins) or a forward-looking application (funding what will be in situ within the first 12 months of the agreement).

Understanding of how SFI rotational actions can be made to work with practical farming realities is still developing. For example, the RPA has recently clarified that the IPM4 option (no use of insecticides on arable crops and permanent crops) is applied to each selected field parcel for 12 months. This may reduce the appeal of the option if multiple crops will be grown on the parcel across the 12 months, with some requiring insecticide. The CLA is pushing for this decision to be reviewed and is in constant contact with the RPA to raise similar issues and to ensure all aspects of the scheme are workable going forward.

The CLA continues to be a strong advocate of the SFI and encourages members to take the time to review the different options and see whether they might work with their businesses. Recent analysis by the Agriculture and Horticulture Development Board has demonstrated the value of the scheme on its model farms in terms of improving income and profit margins when appropriate actions are selected.

Please contact your regional office if you have any questions or require assistance.