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Defra’s agricultural transition plan: Everything you need to know

This week, Defra published its agricultural transition plan (ATP), which sets out some of the major milestones for the sector over the next seven years. Abi Kay reports.

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Defra’s agricultural transition plan: Everything you need to know

Since the UK voted to leave the EU in 2016, farmers have been crying out for detail on what will replace the Common Agricultural Policy.

 

This Monday, Defra sought to answer some of the questions which have been asked in its new ‘Path to Sustainable Farming’ document.

 

Though the plan does outline some detail up to 2028, there is a heavy emphasis on years 2020-2024, when the next General Election is due to be held.

 

What’s new in the document

 

Direct payments

 

The ATP confirmed farmers in England are set to lose at least 50 per cent of their direct payment by 2024.

 

Farmers Guardian has previously reported the figure, but it has been officially set out for the first time.

 

Farmers with a claim of £30,000 or less can expect to see a five per cent cut in the 2021 scheme year, followed by a 20 per cent cut in 2022, 35 per cent in 2023 and 50 per cent in 2024.

 

Those businesses with larger claims will lose more money more quickly (see table here).

 

Other changes will be made to the Basic Payment Scheme (BPS) from 2021, including:

  • Removing the greening rules, as announced in July 2020
  • Removing the requirement for farmers to use all direct payment entitlements at least once every two years
  • Removing the requirement for farm businesses with land in England and another UK nation to have all their land treated as one ‘holding’ for the purposes of the Basic Payment Scheme
  • Extending the application period for force majeure applications to 8 weeks
  • Changing cross-compliance, by moving away from financial penalties to better communication, targeting Rural Payments Agency (RPA) inspections at high-risk areas and improving the speed of post-inspection reports

In 2024, following a consultation next year, direct payments will be delinked from the land, so there is no longer a need to farm to receive remaining entitlements.

 

Lump sum exit payments

 

Defra intends to carry out a consultation on a lump sum exit scheme alongside delinking in early 2021, with aim of offering these payments from 2022.

 

The intention is to allow farmers to leave the sector with dignity by allowing them to receive a lump sum in place of the direct payments they would have been entitled to receive during the remainder of the agricultural transition.

 

Speaking during an Oxford Farming Conference Bitesize online event today (November 30), Defra Secretary George Eustice suggested there would be a qualifying period to prevent anyone who had just joined the industry from taking the lump sum.

 

He also said Defra was ‘looking closely’ at the tax implications of the lump sum, which could affect take-up.


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Countryside Stewardship

 

During 2022 and 2023, more funding will be available for the Countryside Stewardship scheme.

 

In order to support the delivery of goals set out in the 25-Year Environment Plan, several changes to the scheme will be made, including:

  • Expanding educational access provision to farmers in Mid-Tier agreements, to let school pupils visit farms
  • Broadening advice provided as part of the Catchment Sensitive Farming scheme, to cover air quality, flood mitigation and diffuse water pollution
  • Widening scope of capital grants to cover air quality
  • Increasing maximum level of funding under capital-only grants to £20,000 for hedgerow and boundary and water quality improvements
  • Expanding eligibility of the upland option ‘management of rough grazing for birds’
  • Bringing woodland creation and maintenance options together
  • Running a further round of the Facilitation Fund to help groups of farmers work together

For agreements starting from 2021, a range of changes have been made to penalties and inspections to make them more proportionate, and the application for force majeure applications has been extended to eight weeks.

 

Slurry investment scheme

 

From 2022, a slurry investment scheme will be opened to help reduce pollution from farming and prepare the sector for ‘increasingly comprehensive enforcement’ of slurry management rules.

 

The scheme will support farmers to invest in new slurry stores which exceed current regulatory requirements and enable the adoption of other pollution-reducing measures such as low emissions spreaders, which will be a legal requirement by 2025.

 

Catchment Sensitive Farming officers will provide advice to farmers as part of the programme.

 

Alongside the scheme, new regulations will be introduced as part of the Clean Air Strategy to cover all slurry stores.

 

Funding will be given to:

  • Meet one-off capital costs for new stores and impermeable covers
  • Pay for a ‘significant proportion’ of associated equipment such as pumps and pipework

Details of the scheme will be published in the second quarter of 2021.

 

Animal Health and Welfare Pathway

 

The Pathway, which is set to continue beyond transition, will open with a set of targeted and time-limited set of financial incentives to improve animal health and welfare.

 

This support is designed to prepare farmers for making higher standards the basic legal minimum in future.

 

More broadly, the Pathway will strengthen stewardship on antibiotic use, improve on-farm biosecurity and deliver better veterinary advice.

 

It will also focus on eradicating endemic diseases such as Bovine Viral Diarrhoea, lameness and mastitis in cattle, Porcine Reproductive and Respiratory Syndrome virus and a range of issues in the sheep sector, such as parasites, lameness and abortion.

 

It is anticipated that grant aid and match funding will be made available for:

  • Diagnostic testing
  • Better health and welfare management
  • Increased advice from vets and other advisors
  • Capital investment to increase animal welfare, such as cattle handling facilities or equipment to improve biosecurity

Health and disease support will start late in 2022/early 2023, while the first payments for small and large capital grants will be made in 2022.

 

Support for new entrants

 

A new entrants support scheme will be launched in 2022, to allow barriers to starting a new farm business to be overcome.

 

In the ATP, Defra promises to work with councils with county farms to create a scheme which will create lasting opportunities for new entrants, and funding will be provided for the creation of more start-up innovation hubs.

 

Crispin Truman, chief executive of countryside charity CPRE, welcomed the new entrants support scheme, but warned Government must reinvest in county farms to allow new and young farmers to ‘get a foot in the barn door’.

 

Skills and training

 

The Government has agreed to contribute towards the establishment of a new professional body, the Institute for Agriculture and Horticulture (TIAH), to improve skills provision across the industry.

 

TIAH, a recommendation of the Food and Drink Sector Council’s Agricultural Productivity Working Group, will establish a professional framework, providing farmers with a recognised pathway for careers training.

 

TIAH development board chairman David Fursdon said: “TIAH will help support and transform the industry so it is universally capable of creating profit and protecting the planet by training, retaining and attracting a workforce fit for the future.

 

“It will collaborate with all areas of industry to ensure a joined-up approach to promoting training and CPD.”

 

Productivity

 

Spend on productivity will remain broadly the same as it is now throughout the agricultural transition, with just 9 per cent of the 2021/22 overall budget of £2.4bn allocated to this purpose.

 

This money will be channelled to farmers though the Farming Investment Fund, which opens for applications next year.

 

The two levels for this fund will be the Farming Equipment Technology Fund, which will offer small grants to contribute towards the purchase of a list of specified items, and the Farming Transformation Fund, which will provide larger grants towards the cost of more substantial investments in equipment, technology or infrastructure, with the potential to transform business performance.

 

Eligible investments under these funds may include on-farm water storage infrastructure, robotic or automated technology, items to improve animal health and welfare and equipment for processing agricultural products, which may help farmers to streamline or diversify their businesses.

Timeline

2020

  • Animal welfare payment-by-results research project holds first round of stakeholder workshops
  • Defra plans engagement with farm groups on design for future regulatory system
  • Design of Tree Health pilot and future schemes begins, continuing throughout 2021
  • Consultation on draft National Action Plan for sustainable use of pesticides

2021

  • Consultation on delinking and lump sum exit payments
  • Launch of Farming Resilience Programme, providing advice to farmers hardest hit by BPS loss
  • Detailed payment rates for Sustainable Farming Incentive (SFI) pilot published
  • Pilot for final version of SFI begins
  • Farming Investment Fund to boost productivity opens for applications
  • Event in spring 2021 to provide more detail on future animal health schemes
  • Consultation on welfare labelling
  • Consultation on increased capacity requirements for slurry stores
  • Consultation on future of producer organisations

2022

  • Lump sum exit scheme launched, subject to consultation
  • Research and development scheme launched
  • ‘Stepping stone’ SFI opened
  • Additional support for new entrants

2024

  • Farming Resilience Programme closes
  • Direct payments delinked
  • Final version of SFI rolled out
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