No farm should face the prospect of losing more than a quarter of its direct payment before the new Environmental Land Management (ELM) scheme is up and running, the CLA has said.
At the moment, the Government plans to begin cutting direct payments in England from next year, with larger claims being reduced by greater amounts, though the likelihood of a delay to the phase out has increased due to the impact of coronavirus on farm businesses.
As well as calling for the agricultural transition to be put on hold for at least a year, the CLA has said direct payments must be cut by a flat percentage rate across all farm businesses in year two and beyond, instead of continuing with the ‘progressive’ reductions proposed for year one, which will hit larger recipients harder.
The group made the recommendations in a new policy briefing, ‘Next steps for transition from direct payments’.
The document warned continuing with ‘progressive’ cuts after year one would result in large farming businesses losing more than 50 per cent of their direct payments before they were even able to enter the new ELM scheme in late 2024.
Susan Twining, chief land use policy adviser at the CLA, said: “Because of the way the Common Agricultural Policy works, that might sound attractive to some people, but a lot of these businesses are as reliant on the payments as others.
“The scale does not make them any wealthier. There are some economies of scale, but they are as challenged as any average sized business, so it does not make sense for their payments to be cut more deeply because it will damage them to a point where they may not be viable.
“You can get very large tenanted businesses which will be equally damaged by this. Shallower cuts in the first few years will ensure they are more manageable.”
The document also recommends future spending on agriculture and the environment should be properly considered and not ‘limited’ by the current CAP budget.
And it calls on Ministers to introduce a large-scale Business Adaptation Programme to facilitate business change.
The CLA has previously said the Government should spend £200m a year throughout the seven-year agricultural transition to help farmers manage the move away from direct payments, and suggested the amount of money available could be boosted to £500m a year with match funding from industry.