Farm Support – Agricultural Transition Plan

Farm Support – Agricultural Transition Plan
EB

Farm Support – Agricultural Transition Plan

On Monday (30th November) DEFRA published the Agricultural Transition Plan (‘The Path to Sustainable Farming: An Agricultural Transition Plan 2021 to 2024’) detailing how, from 1st January 2021, farm support will move from the familiar BPS to the still largely unknown Environmental Land Management Scheme (ELMS).   

BPS – On its way out!

The publication makes stark reading in that all current recipients of BPS will have their payments reduced by at least half by 2024. Reductions beyond 2024 are not set out but 2027 will be the final year of BPS payments.

These bands will effectively function like income tax, with the first band of reductions applied to the first £30,000, the next to the next £20,000 (i.e. £30,000 – £50,000) and so on.

Payment Banding BPS cut for that portion
  2021 2022 2023 2024
Up to £30,000 5% 20% 35% 50%
£30,000-£50,000 10% 25% 40% 55%
£50,000-£150,000 20% 35% 50% 65%
Over £150,000 25% 40% 55% 70%

 

  • Other more welcome announcements include a promise of “less harsh penalties” for cross compliance breaches, removal of greening requirements including Ecological Focus Areas and the “Three Crop Rule”
  • Farming Investment Fund – reductions in the BPS will be channelled into a new range of grants aimed at increasing productivity, resilience, and skills by investing in equipment, technology, and infrastructure to “deliver environmental and public benefits.” These will be based around the current Countryside Productivity Grants.
  • From 2022 DEFRA intends to offer an “exit scheme” where some retiring farmers can receive a lump sum payment in place of the annual BPS payments they would otherwise have received during the transitional period (2021 – 2027). Details surrounding this proposal are sadly lacking at this stage.  
  • From 2024 DEFRA plans to “delink” payments i.e. claims can be made without the previous requirement to occupy land.
  • …………………..& Existing Countryside Stewardship (CS) Schemes? 

Existing CS agreements (e.g. Mid-Tier & Higher-Tier) will be honoured and the scheme will remain open for new applications until 2024. Those with existing agreements coming to an end between now and 2024 will most likely be offered extensions to keep their agreements live until such time as they can be replaced by ELMS – see below.

ENVIRONMENTAL LAND MANAGEMENT (ELM) SCHEME – The future!

As we recall previously familiar terms such as “IACS, SPS and BPS” the new initials to learn are;

  • The Sustainable Farming Incentive (SFI)  –  This is the “Tier 1” scheme which DEFRA proposes will pay farmers and landowners for “environmental improvements” and is designed to be relatively easily integrated into most commercial farming operations. DEFRA are hoping for almost all farm’s to participate in this scheme, so the requirements are not expected to be overly burdensome but we will have to wait and see…..There will be opportunity for farmers to enter a partial SFI scheme from 2022 and it is intended to be fully operational by 2024. The scheme is described as having a choice of “packages” containing different options, allowing farmers to choose greater or lesser depths of commitment for a correspondingly lower or higher payment. More details including payment rates are intended for release by June 2021 – until then we have no practical detail about the proposed workings of SFI!
  • Local Nature Recovery (LNR)  –  DEFRA confirms that this “Tier 2” scheme is intended to directly replace Countryside Stewardship. Subject to consultation, a national pilot will open for applications in 2021, with the first limited number of agreements aimed to be active in 2022.
  • Landscape Recovery (LR)  –  This “Tier 3” scheme is proposed as being for large scale projects, likely thousands of hectares in area, and for activities such as peatland restoration, woodland planting and rewilding.

The above is only a brief summary of Monday’s publication, which in my view raises many more questions than it provides answers.

I will continue to update our site as DEFRA provide further information and clarity on the structured decline of BPS and its replacement.

Richard