September 25, 2021


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Poor harvest: Is the UK’s post-Brexit green farming subsidy scheme struggling to capture farmers’ attention?

5 min read
Poor harvest: Is the UK's post-Brexit green farming subsidy scheme struggling to capture farmers' attention?

Poor harvest: Is the UK's post-Brexit green farming subsidy scheme struggling to capture farmers' attention?

National Audit Office warns the flagship Environmental Land Management Scheme that is set to come online from next month is at risk from low levels of support from farmers and a lack of detailed objectives

The National Audit Office (NAO) has warned England’s post-Brexit agricultural subsidy regime is at risk of being hampered by a lack of detailed objectives and limited engagement with farmers.

In a report published this morning, the public accounts watchdog concludes the Department for Environment, Food, and Rural Affairs (Defra) is yet to establish detailed objectives for the Environmental Land Management (ELM) Scheme, the system set to replace the EU’s payment regime for farmers.

Unlike the EU’s Common Agricultural Policy (CAP), the ELM Scheme aims to incentivise farmers to undertake measures to enhance so-called ‘public goods’, for instance by enhancing flood resilience, investing in nature-based climate solutions or improving soil quality.

Defra has claimed the Future Farming and Countryside Programme is a “once-in-a-generation opportunity to reform agriculture” and move away from the system of land-based subsidies favoured by the CAP. It is also widely regarded as a key plank of the government’s net zero strategy, given the potential to drive the expansion of natural carbon sinks.

However, the NAO today raised the alarm that the environmental objectives attached to the scheme continue to be described by Defra as ‘provisional’ and fall short of being the “specific strategic policy objectives required to turn the vision for ELM into an implementable programme”.

“Defra has not yet set detailed objectives for the scheme and has been slow to provide information on what farmers can expect from it,” said Gareth Davies, the head of the NAO. “Defra must now develop detailed plans for the scheme’s delivery if it is to achieve its intended environmental goals.”

The NAO’s criticism comes as the government gears up to launch core elements of the first of the ELM’s three core schemes – the Sustainable Farming Incentive (SFI) – by mid-2022, with a smaller pilot of that programme scheduled to kick off next month with 1,000 farmers.

In its assessment, the audit office notes that Defra has made progress in “several important areas” of the ELM’s development and design in 2019, despite significant Brexit and Covid-19 related headwinds.

But it warns the department’s environmental ambitions could also be marred by a low level of interest from farmers in the scheme, noting that just 2,178 farmers signed up to take part in the SFI pilot, out of a total of 44,000 eligible landowners.

The relatively low levels of interest fell far short of Defra’s expectations, the watchdog has warned, noting that the ministry had expected to receive between 5,000 and 10,000 expressions of interest in the pilot programme.

Any continued reticence from farmers to take part in the scheme could have major implications for the government’s environmental agenda, according to the NAO. “Continued low level of interest [from farmers] could threaten Defra’s environmental ambitions,” it said.

The report argues that farmers trust in Defra’s reforms has been hampered by poor management of past agricultural subsidy regimes and more recent delays in informing farmers which actions they will be paid for in the SFI pilot and SFI scheme that is due to launch in 2022. It warns the department is yet to have regained enough trust from farmers to be confident in achieving a high level of participation in the ELM, which launches in full in 2024, and warned that a failure to launch the SFI programme successfully next year would exacerbate this issue.

“The SFI 2022 launch will be the first time that tens of thousands of farmers will experience the ELM scheme in a live situation,” the NAO said. “Failure to launch SFI2022 successfully would cause Defra further reputational damage and reduce long-term participation in ELM.”

Elsewhere, the report notes the government’s decision to change the original ELM programme in late 2020 to bring forward the launch of parts of the SFI to next year adds “risks to delivery” due to the need for a rushed design.

Environment Secretary George Eustice said the government would publish a full response to the NAO’s report where it would address areas where there had been “misunderstandings”.

“The NAO recognises that we have made good progress but we will be addressing some areas where there have been misunderstandings in our full response to the report,” he said.

“Our future agricultural policy will move away from the arbitrary land subsidies and top-down bureaucracy that epitomised the EU era,” Eustice said. “We will incentivise sustainable farming practices and reward farmers for the environmental assets on their land.”

However, the NAO’s assessment broadly echoes long standing concerns among environmental and farming groups. Green campaigners have broadly welcomed the plan to reform subsidies to reward farmers for providing public goods, but they have also warned that the SFI scheme risks providing payments to farmers for delivering negligible environmental improvements and that the lack of clarity over precisely how the ELM Scheme will work risks undermining its considerable potential.

Jim Elloitt, senior policy adviser at Green Alliance, said it was critical the government codify clear aims for the post-Brexit subsidy schemes for farmers.

“The new ELM schemes will ensure that billions of pounds of public money is paid to British farmers, but as the NAO point out, the environment department is designing these schemes without a clear set of objectives,” he said. “As other sectors make progress, it’s unsurprising that agriculture and land use is the furthest away from being on track to meet our climate targets. The public deserve to know that their money is being spent wisely to sequester carbon, improve habitats and help restore wildlife.”

The ELM Scheme could prove to be one of the green jewels of the UK’s net zero strategy and one of the clear benefits to arise from the government’s controversial Brexit plans. There is a clear opportunity to redefine farming best practices, drive the expansion of carbon sinks, and reverse the UK’s continuing decline in biodiversity. But with just a few months to go until the launch of the scheme it is clear the government needs to get a grip on how the scheme will work in practice and precisely what it is trying to achieve, or else risk another costly Brexit-related fiasco.

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