Defra’s Agricultural Transition Plan has started to swing into action in England during the past 18 months. The first cuts to Basic Payment Scheme (BPS) payments have begun, and various new funding schemes have emerged. The CLA has been closely involved in the development of all of these schemes and others still to come.
What happened with agricultural transition in 2021
Last year, the focus was on improving productivity and business resilience by helping farmers and land managers to prepare their businesses for success beyond BPS. Several new schemes were launched, including the Future Farming Resilience Fund, Farming in Protected Landscapes, the Farming Investment Fund and the Farming Innovation Programme. The CLA has produced a series of guidance notes on these new schemes, which can be found on its dedicated Agricultural Transition hub.
What is happening with agricultural transition in 2022
In the spring, Defra launched the lump sum exit scheme, which allows eligible BPS recipients to exit the industry. The scheme pays out a lump sum of remaining BPS payments on the condition that BPS entitlements are surrendered by May 2024.
In June, the first part of the Sustainable Farming Incentive (SFI) opened for applications, and three SFI standards are now available: arable and horticultural soils, improved grassland soils, and moorland. These offer payments for sustainable actions, such as increasing soil organic matter and identifying opportunities to improve moorland management.
The offer for 2022 provides something for most farmers across England, and more standards will be added between now and 2025, covering areas such as nutrient management, hedgerows and grasslands. The SFI has a rolling application window and a choice of ambition levels, so you can choose what to apply for and when. As more standards are added, businesses will be able to build up the value of their agreement by adding more land and new standards.
The CLA is closely involved in the development of these standards. It has been lobbying for increased payment rates in the existing standards and for future standards to be fast-tracked into the full scheme. While SFI does not suit everyone, it is worth considering it when looking at your circumstances and bearing in mind that payments will increase as more standards become available.
The Landscape Recovery pilots have also been launched, which aim to fund species recovery and river restoration at a landscape scale. The scheme is open to large projects (from 500 – 5,000ha) by individuals or groups of land managers over 20 years. These projects will have a ‘development period’ to sort out ambitions, detailed plans, define the funding level and sources of funding, such as from the government or private sector and the contractual agreements. There will be new Landscape Recovery application windows in the future, so now is the time to start thinking about putting a project together if this is of interest.
The Animal Health and Welfare Pathway will be launched later in 2022. This is a new programme that has big ambitions to tackle endemic livestock diseases. It will start with fully-funded vet visits for commercial beef, dairy, pig and sheep farmers.
Defra’s new entrants scheme will be piloted in the autumn, ahead of its full launch in 2023. The pilot will focus on incubator hubs that will address some of the barriers to new entrants.
The Slurry Investment Scheme is expected in autumn 2022, and will provide grant funding for farmers to upgrade existing slurry infrastructure to help reduce risk to water quality.
BPS will continue to be the biggest player for many CLA members over the next few years before final payments are made in 2027. Payments will be delinked from 2024, meaning remaining annual payments will be made without the need for an annual claim or any other conditions. This will reduce paperwork and free farmers and land managers to think about the new schemes and how to adapt their business.
As further cuts to BPS are made, more funds will be diverted towards the new schemes, with the bulk of public money being spent on delivering public goods. The CLA has always argued that this is the best guarantee of continued funding for the sector.
However, many of the new schemes are still in development. The Local Nature Recovery (LNR) scheme, the successor to Countryside Stewardship, will be piloted in 2023 before its full launch in 2024. It will fund targeted local environmental actions and encourage collaboration between groups of land managers to deliver them. In the meantime, Countryside Stewardship – simplified, improved and with higher payment rates – remains popular with many members and applications will re-open in 2023.
The CLA is working with Defra to develop new SFI standards and detailed LNR options, ensuring they are practical to deliver, contribute to government environmental targets and are attractive to farmers and land managers.
There is still a long way to go. The biggest impact will be the removal of BPS payments, which will be removed by 2028. The new agricultural policy is there to support the transition with schemes to support sustainable and more productive farming alongside a range of environmental schemes. It is a complex picture, but there is a lot of help. The Future Farming Resilience Fund - which provides free advice on the transition until 2025 - is a good place to start.
If you are interested in doing more for the environment, these environmental land management schemes will provide support, alongside the England Woodland Creation Scheme. This could mean adopting more sustainable practices or finding land to manage for the environment, from small-scale field corners and margins to creating woodlands or wetlands that sequester carbon and benefit wildlife.
The CLA has a lot of information, which can be found on its online Agricultural Transition Hub, and our advisers are on hand to answer member enquiries.