ELMS update at Oxford Farming Conference

Minister for food, farming and fisheries Mark Spencer opened the talk on UK Policy at OFC 2023. He said that as a farmer himself, he’s seen first-hand the challenges faced in recent years by farmers trying to keep the public fed through thick and thin, as well as taking care of the country’s landscapes.

He commented that all the evidence, as well as plain common sense, suggests that making a shift towards sustainable farming is critical in order to ensure every generation has a better future – keeping everyone fed and saving the planet at the same time, which are two sides of the same coin in his eyes.

Mr Spencer explained that uncertainty about government intentions for the future of farming has not helped the industry, but added that the review of the farming policy has concluded and it now plans to crack on with reforms as planned.

This month, detailed information will be published about what the government will pay for in these schemes, although Mr Spencer said the overall level of funding to farmers remains unchanged from the original manifesto.

Mr Spencer announced “more money” for farmers and landowners through the Countryside Stewardship (CS) and Sustainable Farming Incentive (SFI) schemes. Details will also be published shortly via www.gov.uk on an expanded range of actions that farmers could be paid for.

The changes mean farmers could receive up to a further £1,000 per year for nature-friendly actions through the Sustainable Farming Incentive. This new Management Payment is available to both current and new registrations. It will be made for the first 50ha of farm (£20/ha) in an SFI agreement, to a maximum of £1k, aimed at covering administrative costs of participation and to smaller businesses – many of whom are tenant farmers, who are currently under-represented in the scheme.

Tenant farming

Baroness Kate Rock, who also spoke at the session, highlighted the importance of ensuring the ELM scheme goes far enough to support tenant farmers further, commenting: “The new farming incentive is aimed at funding regenerative agriculture, but in order to take advantage of this and participate fully, tenancy agreements need to be assessed so that tenanted land can play its role in a regenerative future.”

She expanded on this by explaining that regenerative farming and sustainability are clauses often written into tenancy agreements but in many cases this can create a yield penalty or result in costs which have to be swallowed.

The positive benefits of moving to or operating a regenerative ag system can take many years, but with half of England’s agricultural land having a tenant farmer as its steward, it is essential that the tools to do this are made available to them too.

“We can make it successful” – Spencer

SFI is already paying farmers for soil and moorland improvements, and an expanded set of standards for 2023 is due to be published shortly. Mr Spencer also announced that the 30,000 farmers in England with a CS agreement will see an average increase of 10% to their revenue payment rates, covering ongoing activity such as habitat management. Defra is also updating capital payment rates, which cover one-off projects such as hedgerow creation, with an average increase of 48%.

Meanwhile, capital and annual maintenance payments for the England Woodland Creation Offer (EWCO) and Tree Health Pilot (THP) will be updated this year, to incentivise farmers to incorporate more trees on farms.

Mr Spencer said: “My challenge to our great industry is simple – this year, take another look at the Environmental Land Management schemes and think about what options and grants will help support your farm.

“As custodians of more than 70% of our countryside, the nation is relying on its farmers to protect our landscapes as well as produce the high-quality food we are known for, and we are increasing payment rates to ensure farmers are not out of pocket for doing the right thing by the environment.

He concluded: “If we work together, we can get this done and get it right – by putting our businesses on a good footing for the future, we can make it successful.”

Concerns over ELMS delay

However, shadow farming minister Daniel Zeichner’s view was that “as the government changes its role and potentially takes a step back from its role in food production, the plan is that there isn’t really one – the plan seems to be to leave it to the market.”

A recent report by the House of Lords urged the government to provide urgent clarity on ELMS to give confidence to the farming community.

More than 300 British farmers wrote to their MPs in October with concerns over delays to the scheme. Prime minister at the time Liz Truss announced a review of ELMS in October, which prompted fears it could be scrapped or watered down.

In response to the rumours, Defra commented at the time: ‘We’re not scrapping the schemes. In light of the pressures farmers are facing as a result of the current global economic situation, including spikes in input costs, it’s only right that we look at how best to deliver the schemes to see where and how improvements can be made.’

Industry response

Responding to Defra’s announcement of further changes to its Environment Land Management scheme (ELMS), NFU vice president David Exwood said: “I regret that farmers and growers are making crucial long-term decisions that are essential to running viable and profitable food producing businesses without the vital clarity needed on ELM schemes and options that will be available.

“While some of these latest changes are welcome, including enhanced payments for farmers and landowners through the Countryside Stewardship scheme and the introduction of a Sustainable Farming Incentive (SFI) management payment, it risks being too little too late, especially given the current economic challenges we are experiencing and the rapid erosion of direct payments.

“It is hugely frustrating that nearly five years on from Defra’s Health and Harmony consultation, which set farming in England on a path towards public goods for public payments, we still only have three standards available for the SFI. It’s a sad reflection of the scheme’s progress and development that NFU members know more about what they will lose in direct payments than what they will gain from taking part in these new schemes.

“The NFU has always been very clear; for the ELM to succeed it needs to be simple, provide certainty and fairly reward farmers for taking part. This means schemes that are inclusive and available to every farm business – whether upland or lowland, tenant or owner-occupied – with a range of practical and profitable options available through a ‘foundation’ SFI standard to ensure the high uptake needed so these schemes have the desired impact. Ministers must also demonstrate transparently how direct payments have been redirected to the ELM programme.”

The National Sheep Association (NSA) welcomed the announcement that there will be an uplift to Countryside Stewardship (CS) and Sustainable Farming Incentive (SFI) payments to aid in tackling rising input costs.

NSA chief executive Phil Stocker says: “NSA welcomes the uplift in revenue and capital payments in CS, and the additional £20/ha for the first 50 hectares, equating up to £1,000 per agreement in SFI agreements. However, while this is good news, it only scratches the surface in terms of what is needed in details of the Future Farming schemes available in 2023. Farmers were originally promised a detailed prospectus before Christmas, than in the New Year, and now it looks it will likely be the end of January, by which time many farmers will be busy lambing, calving and hopefully looking forward to some fieldwork. Uncertainty still reigns even though the intention is becoming clearer.”

The Soil Association responded by warning we still await the bold and decisive announcement needed from the government to give farmers confidence and spark a mainstream shift to truly nature-friendly farming, while welcoming the announcement that farmers will be incentivised further to protect insects and restore habitats.

Soil Association head of farming policy Gareth Morgan said: “Today’s payment hike recognises the poor uptake so far of the Sustainable Farming Incentive scheme, but farmers still await the bold vision and clarity they need to invest with confidence in a transition to nature-friendly farming systems, like organic. We are running out of time – government needs more game-changing action.

“If we are to truly reverse the catastrophic decline in wildlife and meet our climate goals, we need bolder ambition with support for farmers to protect nature across their entire farm, not just in protected areas. Transformative change is needed rather than tinkering around the edges. The Environmental Land Management Scheme cannot achieve this in isolation – trade deals, carbon markets and supply chains must also work to ensure British farmers can produce nature-friendly food that is good for both the planet and human health.”