Category: Policy & Business

There appears to be delays in offering Hedgerows and Boundaries Capital Grants (HBCGs).  Agreements should have been offered in July to those who applied by 3rd May deadline, with contracts starting at the beginning of the following month.  Apparently they are awaiting ‘Defra clearance’, with no idea when this will be given.  This unfortunately continues a long-running saga of delays with Environmental and Countryside Stewardship Agreements.  Applications to the HBCG are all online and should in theory be fairly straightforward to process, but the hold-up seems to be with Defra sign-off, which seems rather strange.

Defra has released a leaflet setting out its latest information on farming policy in England after Brexit.  With the slightly strange title of ‘Farming is changing, here’s what you need to know’ the leaflet includes much of the information we have already written about on phasing-out direct payments between 2021 and 2027 and introducing the new ELM scheme.  However it does give some further information and ‘firm-up’ a number of other ideas, although little detail is included.

With reference to existing payments and the way producers receive them the following points have been made;

Direct payments –  only the first year (2021) of deductions remain known, with the leaflet stating future deductions will be set taking into account detailed plans for future schemes and ‘wider decisions about Government spending’.  Defra has said it will keep farmers updated on decisions, but unless timely information is available, preparing budgets could become very difficult.  In addition, the ‘cash total funding’ guarantee is only until the end of this Parliament, which keeps being referred to as 2022, but could be sooner.

Delinking – this is the idea that direct payments will be made regardless of whether the claimant continues to farm or not.  Defra has confirmed in its leaflet that the earliest delinking would be available is 2021 and it will be consulting on the detail of these changes.  The consultation was originally meant to be this summer, but has been delayed until ‘later in the year’.

Lump sum – Defra has stated it is ‘looking into the option’ of offering farmers a one-off lump sum instead of annual payments and it plans to consult later in the year on how this could work best.  Similar to delinking, this option will be available from 2021 at the earliest.  However for both it was never really expected to be available any earlier.  With regards to the lump sum, the language used, ‘we’re looking into the option’ as opposed to ‘we plan’ for delinking, suggests lump sum payments are less likely. 

Rural Development Programme – the information leaflet reiterates all RDPE projects commencing before the end of 2020 will continue to be supported for the lifetime of the agreement.  However, what is new is mention of Defra working with the Ministry of Housing, Communities and Local Government to look into ways in which the UK Shared Prosperity Fund will support the rural economy after the UK leaves the EU.  Defra has confirmed Countryside Stewardship (CS) will continue to be available in the ‘first few years’ of the transition period.  Unfortunately there is no end date given and it is likely to be dependent on the progress of the new Environmental Land Management (ELM) scheme (see below) as Defra expects the two schemes to overlap for a ‘period of time’.  But those who are thinking about entering CS should not be put off for fear of being unfairly disadvantaged when the new ELM scheme is available as Defra has said it will ensure this will not happen.

As direct payments are phased out future funding and financial support will be available through;

Environmental Land Management (ELM) scheme – this will be the flagship scheme in the future.  Land managers will be awarded ELM agreements for providing environmental benefits.  The plan is to launch the new scheme from 2024, however, no further detail on scheme design is included.  The CS will not be available once the scheme is fully up and running.

Animal Welfare – Defra is looking into an animal welfare grants programme, which would provide one-off payments to support farmers to provide welfare enhancements beyond the regulatory baseline standards.  A further initiative being explored would see livestock producers being rewarded with on-going payments for signing up to and achieving animal welfare enhancements above the baseline.

Investment support – during the agricultural transition period (2021-2027), the plan is to offer support towards equipment, technology and infrastructure which improves farm productivity in an environmentally sustainable manner and provides other public goods.

Research and Development – support will be made available to enable farmers to work with researchers to find new ideas and technological solutions to problems that will really make a difference.  The innovation R&D package will build on the current £90m Transforming Food Production initiative. (see February 2018 article https://abcbooks.co.uk/innovation-funding/)

Whilst there isn’t a lot of ‘new’ information contained in it, the fact the leaflet has been released after the appointment of Theresa Villiers suggests Defra is still looking to implement Michael Gove’s plans.  Although as we have said many times, these proposals are still not laid down in legislation and could change, particularly if there were to be a new administration.

 

Defra has published detailed statistical data farm profits in different parts of England (see https://www.gov.uk/government/statistics/agriculture-in-the-english-regions).  It has been doing this for some years for the main regions (South West, North East etc.), with a profit (Total Income from Farming, or TIFF) for each one.  But, in a new development, it has now broken the data down into greater detail, with a TIFF being provided for each County or Unitary Authority.  As an example, the profit from Lincolnshire agriculture in 2017 was £355m.

It appears that around 1,000 Environmental and Countryside Stewardship scheme agreement holders have been paid too much.  These are some of the claimants who were given ‘Treasury-funded’ payments in July because they had outstanding claims dating from 2015-2018 (see June’s article https://abcbooks.co.uk/agri-environment-payments-2/).  The RPA should, by now, have written to all those affected requesting repayment.  The problem seems to be where the annual revenue claim has incorrectly included a payment for capital items as well.  It is probably inevitable there will be further over-payments identified once all the claims have been fully processed as the Treasury-funded payments were based on 100% of the estimated claim. 

The water industry in England has announced plans to plant 11 million trees to support their goal of being carbon neutral by 2030.  The proposal involves planting trees on around 6,000 hectares of land.  In addition, there will be restoration work carried out on existing woodland, plus hedgerow and grassland improvement.  Some of the land is already owned by the nine major water and sewerage companies in England, but other land will be provided by Local Authorities, The National Trust, the Wildlife Trusts and the RSPB.  The Woodland Trust has also said it will help the companies identify appropriate sites and manage the planting programme once it has been developed.

Similar to last year, the Welsh Government has announced a BPS loan scheme will be available to those who do not receive their 2019 Basic Payment on the first day of the payment window.  This year the payment window opens on 2nd December 2019 (1st is a Sunday) and closes on 30th June 2020.  Those in Wales who do not receive their Basic Payment on the first day will be eligible to receive payment of up to 90% of their claim.

Again, like last year, this will be an opt-in scheme.  It is expected applications will have to be made via Rural Payments Wales (RPW) Online.  Those who are due to receive a Basic Payment should keep an eye out for when the application window for the loan scheme opens as all are urged to apply because until payments are made claimants will not know if their payment will be made on the first day or not.  Last year loan payments were made from 10th December.  Wales already has a good record for making payments on the first day of the window, but this will ensure just about all claimants receive most of their Basic Payment within the first couple of weeks of the window opening.  The Welsh Government has said this will provide some certainty for those concerned about cash flow as the UK leaves the EU in the autumn.

Defra has launched a ‘call for evidence’ to feed into its National Food Strategy.  Readers may recall we wrote about this back in July.  The purpose of this element is to gather ‘inspiration’ to try and transform the food system.  Defra are particularly interested in ideas that;

• help people make informed decisions about the food they eat
• increase the access to and affordability of high-quality food
• make food production more environmentally sustainable
• help farming, fishing and food businesses thrive
• promote the highest standards of animal health and welfare
• put England at the forefront of innovation in the food sector.

The call for evidence is part of a wider independent review being conducted by Henry Dimbleby to assist the government to create its first National Food Strategy.  The call for evidence closes on 25th October 2019.  For further information and to submit evidence go to https://consult.defra.gov.uk/agri-food-chain-directorate/national-food-strategy-call-for-evidence/

All agri-environment payments in England are to move to a once-yearly basis.  Up to now there has been a 75% advance paid in the autumn of the scheme year, followed by a 25% top-up the following spring.  The RPA has now announced that a single payment will be made for the 2019 claim year onwards.  Like the BPS, this will be made at some point from the start of December through to June.  It is stated that this will improve overall payment performance by reducing the amount of processing work.  The change applies to both Countryside Stewardship and Environmental Stewardship (i.e. HLS) revenue claims.

Defra has opened another round of the Countryside Stewardship Facilitation Fund on the 5th August.  £2.5m is to be made available to fund a person or organisation (the facilitator) to help groups of farmers and other land managers work together to apply for the CS and deliver benefits at a ‘landscape’ rather than single-farm scale.  Applications close on the 4th October.  Successful groups will be notified in time for individual farms to apply for the CS in spring 2020 in time for a 1st January 2021 agreement start date.  The Facilitation Fund has already led to the creation of 98 facilitation groups established across England since 2015 . The groups have supported and endorsed 1,200 new Countryside Stewardship agreements (i.e. an average of 12 farms in each group).