The Future Agricultural and Rural Policies

The DEFRA Minster George Eustice has today announced “The Path to Sustainable Farming: An Agricultural Transition Plan 2021 to 2024” which sets out the new agricultural policy under the new Agricultural Act. 

In George Eustice’s words:

 “as we contemplate the biggest change in agricultural policy in half a century, we must design one that is not only right for the farmers of today but is also right for the farmers of tomorrow.”

“where, for the first time in fifty years, we have a chance to do things differently”

“our plans for future farming must tackle climate change”

“as we take control of our agricultural policy, we can deliver the pace of change on land management for environmental benefits that the EU has never managed to achieve. Our farmers and land managers will play a crucial role in the national effort to reach Net Zero” 

The focus of future farming policy will be the three components of Environmental Land Management:

  1. The Sustainable Farming Incentive will support sustainable approaches to farm husbandry to deliver for the environment, such as actions to improve soil health and water quality, enhance hedgerows and promote integrated pest management.
  2. Local Nature Recovery will be a new scheme that eventually replaces Countryside Stewardship and will focus on building back nature into and beyond our farmed landscape.
  3. Landscape Recovery will support more fundamental changes to land use in order to significantly enhance the landscape and restore wilder landscapes.

In 2021

  • On 1 January 2021 the agricultural transition period will start.  DEFRA will gradually reduce and phase out existing agri-environment schemes starting in 2021, with the last Direct Payments being made in 2027.
  • DEFRA will make changes to cross-compliance, moving away from defaulting to financial penalties, instead using proportionate measures such as better communication. This will start to change the tone of Rural Payments Agency interactions with farmers to make them more constructive and advisory.
  • DEFRA will make the money they save from Direct Payment reductions available through schemes, grants and other types of support for farmers to manage land and their businesses more sustainably.
  • DEFRA will test and trial National Pilot of Environmental Land Management with upto to 5,500 farmers.

2022 to 2023

  • The Sustainable Farming Incentive will commence.
  • DEFRA will commence a Slurry Investment Scheme to help reduce pollution from farming.
  • DEFRA will offer an exit support scheme to help farmers who want to retire.

2024 to 2028

  • The full roll-out of the three components of our Environmental Land Management.
  • By the end of 2024 we anticipate that legacy Basic Payment Scheme payments will have reduced by about 50%.
  • DEFRA plan to delink Direct Payments from the land. We will then phase the residual payments out, with the last payments made in 2027. Delinked payments will be calculated fairly, based on a reference period.
  • In 2024 the need to Cross Comply will end and commence a new structure of rules.

The Environment Bill introduce:

  1. Local Nature Recovery Strategies.
  2. Biodiversity Net Gain.
  3. Conservation Covenants.

These measures will to help lay the foundation for a national Nature Recovery Network. 

Schemes which will be available

Countryside Stewardship Agreements and Capital Grants

Will end in 2024.  Anyone in a current Countryside Agreement that starts from January 2021 who secures a place in Environmental Land Management will be able to withdraw without penalty at agreed exit points.

The following will be added for 2021 applicants:

  • expand educational access provision to farmers and land managers in Mid-Tier agreements to let school pupils visit farms for educational experiences and for care farming visits.
  • broaden the advice we provide as part of the Catchment Sensitive Farming scheme so that it includes advice on air quality and flood mitigation, as well as on diffuse water pollution.
  • widen the scope of some of our current capital grants to cover air quality and introduce two new capital options specifically to address air quality issues.
  • increase the maximum level of funding available under capital only grants to £20,000 for hedgerow and boundary and water quality improvements. We will also be expanding the range of capital grants available in the standalone capital only offer to better complement the wildlife offers.

Tree Health Pilot and Nature for Climate Fund

The recent consultation on an England Tree Strategy, which closed on 11th September 2020, will inform the publication of our strategy early next year, setting out a long-term vision for the forestry sector and a range of activities to drive woodland creation, and protect and manage our woodland. There will be a number of opportunities for land managers to plant and manage trees. For example, this includes a programme of work on trees to deliver through the Nature for Climate Fund. We will work across these offers to ensure everyone understands what is available to them for tree planting.

Farming Investment Fund

DEFRA are continuing to work with farming organisations as we develop the scheme design and decide what equipment and technology will be eligible for grants.

Environmental Land Management Pilot

DEFRA plan to start sharing more detailed information about the National Pilot and inviting expressions of interest early in 2021.   Upto 5,500 farmers who want to be involved helping us to learn and co-design the full Environmental Land Management ambition. The pilot will commence in late 2021.

  • Environmental Land Management scheme

Defra will pay farmers for delivering land management actions that contribute to:

  • clean and plentiful water.
  • clean air.
  • protection from and mitigation of environmental hazards.
  • mitigation of and adaptation to climate change.
  • thriving plants and wildlife.
  • beauty, heritage and engagement.
  • Sustainable Farming Incentive

Will pay for actions to manage land in an environmentally sustainable way. Actions will be grouped into simple packages to make it as easy as possible for farmers to identify what actions are best suited to their land.  In its early years the scheme will focus on supporting and maintaining environmentally sustainable farming improvements that most farmers can make.  It will focus on:

  • cropland management.
  • grassland management.
  • livestock management.
  • tree and woodland management.
  • boundary and hedgerow management.
  • soil management.
  • nutrient management.
  • integrated pest management.
  • efficient water use.
  • wildlife and biodiversity.
  •  the protection of heritage assets.
  • Local Nature Recovery

Will pay for actions that support local nature recovery and deliver local environmental priorities including:

  • creating, managing and restoring habitats such as woodland, wetlands, freshwater, peatland, heathland, species-rich grassland, and coastal habitat.
  • connecting isolated habitats to form networks.
  • natural flood management.
  • species management.
  • rights of way, navigation and recreation infrastructure.
  • education infrastructure events and services.
  • geodiversity and heritage asset management.
  • Landscape Recovery Farming in Protected Landscapes

Will support the delivery of landscape and ecosystem recovery through long term, land use change projects, including rewilding in places where it is appropriate.  It will focus on:

  • large-scale forest and woodland creation.
  • restoration and improvement.
  • cosystem restoration.
  • peatland restoration
  • the creation and restoration of coastal habitats such as wetlands and salt marsh.

Animal Health and Welfare Pathway

Will support farmers in producing healthier, higher-welfare animals by providing financial assistance, strengthening the baseline of regulation and improving consumer transparency.

  • Slurry Investment Scheme

Will help farmers to invest in new slurry stores that exceed current regulatory requirements and are proofed against higher standards that we expect to introduce in the future.

  • Farm Resilience Support

This will be a time limited scheme operating during the first three years of the transition, up until 2024.  Farmers who are currently in receipt of Direct Payments will be the target group for this scheme.  DEFRA will focus this scheme towards those whose incomes are likely to be most adversely affected by the removal of Direct Payments.

  • Farming in Protective Landscapes

Will help farmers in Protected Landscapes diversify their income streams and lay the groundwork for Environmental Land Management.  The scheme will deliver funding through the Protected Landscapes  bodies to support farmers, particularly upland farmers (75% of whom live and work in Protected Landscapes) to make improvements to the natural environment, cultural heritage and public access on their land.  Farmers in Protected Landscapes will have the opportunity to work with their National Park or Area of Outstanding Natural Beauty.

  • New Entrants Support Scheme

Will provide funding to create lasting opportunities for new entrants to access land, infrastructure and support to establish successful and innovative businesses working with Council Farms and other landowners.

  • Innovation Research & Development Scheme

These projects will be farmer-led and focused on finding practical solutions to immediate on farm productivity challenges.

  • Farming Transformation Fund

Will be available towards the cost of more substantial investments in equipment, technology or infrastructure, with the potential to transform business performance. Applications will be assessed against their ability to contribute towards scheme objectives. This could include making more efficient use of water or using nutrients and pesticides more effectively.

Eligible investments could include:

  • farm water storage infrastructure.
  • including reservoirs.
  • precision agriculture equipment (low emission and variable-rate nutrient or pesticide application).
  • robotic or automated technology.
  • items to improve animal health.
  • specialist forestry equipment.
  • equipment and technology for storing, sorting, or processing products.
  • large-scale precision agriculture projects.
  • precision agriculture and low-emission nutrient application equipment.
  • Farming Equipment and Technology Fund

We are working with farmers, foresters, growers, contractors, and representative organisations to decide the 52 equipment and technology that should be on the list of eligible items, based on their potential to improve farm performance. Applications will be made by a quick and simple online application and approval process, with a clear grant value assigned to each item.  It will incentivise and support the purchase of equipment, technology and infrastructure to support environmentally sustainable farming and land management.

  • Lump Sum Exit Scheme

Applications invited in 2022.

  • Basic Payment

Reduced annually from 2021 until 2027 when it will end, delinked to land.  The reductions will be as per the table below:

What will be my Direct Payments reductions between 2021 to 2024?

DEFRA Farm Funding from 2021 to 2024

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