Consultation launched on exit payments to farmers

Government releases long-awaited details of how it aims to support farmers through the agricultural transition period
Tractor in a field in Hull, UK
Tractor in field

The government has today (May 19) published a long-awaited consultation on changes to the Basic Payment Scheme (BPS) to support farmers through the agricultural transition period from now until 2027.

The consultation will be open for 12 weeks and seeks to gain responses from the agricultural sector on two key areas:

- Lump sum exit scheme – The government proposes to offer farmers, who would like to retire or leave the industry, a lump sum payment to help them do this in a planned and managed way.

- Delinked payments - The government plans to phase Direct Payments out over a gradual seven year transition period. The consultation includes plans to separate the payment from the amount of land farmed from 2024 as well as encouraging farmers to take up the government’s new environmental land management schemes, which will reward sustainable food production and environmental improvements.

This follows last year’s announcement of the Agricultural Transition Plan - the Government’s plans to reward farmers and land managers for sustainable farming practices.

The proposals within the consultation seek to offer a fairer system for farmers, encouraging generational change by providing more flexibility for new entrants to start up their farm businesses and supporting those who are ready to leave the sector to do so on their own terms.

The biggest challenge is the timing, and there can be no further delays in launching the scheme later this year

CLA President Mark Bridgeman

CLA President Mark Bridgeman said:

“We welcome the launch of this long-awaited consultation on the lump sum exit scheme and the administration of direct payments as the scheme is phased out.

“The consultation does give much-needed information on the exit scheme. But for those considering the scheme, there are still many questions to be answered that will only be available after the consultation. The scheme will not be for everyone, but if the scheme is to contribute to industry restructuring and create opportunities for new entrants and those wishing to expand, there are some critical issues to be addressed – including clarity on tax treatment of lump sums payments, and the eligibility and exit conditions. The biggest challenge is the timing, and there can be no further delays in launching the scheme later this year.”

The consultation will close for responses on 11 August 2021.

Submit your response here

Key contact:

Joel Holt
Joel Holt National Communications Manager