Defra has proposed making payments to farmers based on income foregone and costs incurred under ‘Tier 1’ of its proposed new agriculture scheme.
Tier 1 of the scheme is designed to be accessible to as many farmers as possible and would pay for good management of nutrients, pests, livestock and soil, as well as field margins, field cover and efficient water use.
Tiers 2 and 3 of the new scheme, which focus on locally-targeted environmental outcomes and landscape-scale land use change, are expected to be more complex to enter, with specialist support and advice needed to apply.
The department has also suggested it may adjust payment rates for Tier 1 over time to maximise participation in the scheme, which could lead to a situation where early adopters are penalised.
The plans were revealed in a new ‘discussion document’ published by Defra today (February 25) on the Environmental Land Management Scheme (ELMS), though officials made clear views were being sought on both proposals.
Claire Robinson, countryside adviser at the NFU, said the union was calling on Government to change the way it measures income foregone to ensure farmers could be more fairly rewarded.
“We fully recognise the weaknesses of income foregone,” she said.
“It seems to have been ratcheted downwards every time the calculation is done, so we are exploring whether there is a different way for farmers to achieve fair reward or for incentives to be provided to participate so as many people as possible join the scheme.
“Currently, a lot of fixed costs are covered by the Basic Payment Scheme, but we are moving into a space where that is not covered, so it is reasonable to be saying we need to cover more than just gross margin plus the cost of delivery.
“It needs to look a bit wider than that. Otherwise your fixed costs and management costs get concentrated on a smaller area of farm which then has to make more money.”
Ms Robinson went on to point out upland and grassland farmers had seen their payments under Countryside Stewardship slashed to one third of what they received under HLS or ELS, because the payment calculations were done at a time when the livestock sectors were under pressure.