Category: Policy & Business

SFS Delayed: Wales

The commencement of the Sustainable Farming Scheme (SFS) in Wales has been delayed by one year.  In a Written Statement, Huw Irranca-Davies, the new Cabinet Secretary for Climate Change and Rural Affairs, has announced the SFS Transition Period will now commence from 2026.  Instead, during 2025 there will now be a Sustainable Farming Scheme Preparatory Phase of Activity.  During this phase the intention is for the BPS to be available and an announcement on the BPS ceiling for 2025 will be available ‘in due course’.

The Cabinet Secretary has also announced the ‘new timeframe’ will also allow for a number of other pieces of work to take place including;

  • Discussions with Plaid Cymru and the Ministerial Roundtable to quickly identify areas of agreement to allow time for areas where more work is required
  • Using the Roundtable to find an appropriate payment methodology for the new scheme – recognising the wider benefits farming provides, going beyond income forgone and costs incurred, to recognise social value
  • Undertaking a data confirmation exercise – feedback from farmers will be used to provide an accurate picture of the habitat and tree cover across all farms – the 10% tree cover requirement has been one of the most controversial parts of the SFS to date
  • Working with stakeholders to identify and develop a set of proposals for further Optional and Collaborative Actions with the intention of introducing these as soon as possible.

In terms of direct support for Welsh farmers in 2025 it appears that many of the current schemes will continue.  In addition to the BPS, the Welsh Government has said it expects the Small Grants Scheme to be available.  Furthermore, the Habitat Scheme Wales, which was opened last year as an ‘interim scheme’ between Glastir and the new SFS has been seen as a success and the Cabinet Secretary has said he is ‘exploring giving more farmers the opportunity to access support in 2025’.   In addition, he has announced they are working on a ‘new landscape scale’ scheme which will build on the experience of previous collaboration schemes.

Farming Connect looks set to continue with an emphasis on promoting the ‘benefits and opportunities’ of tree cover and woodland on farms and also continuing support for knowledge transfer.  Similar to this year support for organic farmers is also being considered.

The Written Statement comes amid continued protests from Welsh farmers over the introduction of the new SFS scheme; it remains to be seen if their concerns can be addressed over the coming months.  The full Written Statement can be found at https://www.gov.wales/written-statement-future-farming-wales.

 

Sheep Payments: Scotland

The Scottish Government has announced sheep headage payments are starting to be made to eligible farmers.  As of 10th May, 97% of eligible applications to the Scottish Upland Sheep Support Scheme (SUSS) 2023 had been processed and more than 1,000 businesses will receive a share in the region of £6.6 million.  The individual animal payment rate for 2023 is £61.38 per animal.  Under the 2022 scheme the payment rate was £61.25.  The increase in payment rate for 2023 is due to a small decrease in eligible animals claimed.

UK Border Controls

On 30th April, the UK Government introduced its next phase of border controls under its ‘Border Target Operating Model’ (BTOM), which was published in August 2023.  This phase builds upon the customs controls, declarations, pre-notifications and health certifications introduced in January for imports from the EU and focuses on implementing documentary and risk-based identity and physical checks at UK Border Control Posts (BCPs) for goods subject to sanitary and phytosanitary (SPS) checks from the EU, excluding Ireland.

The key changes are;

  • ‘Medium’ risk products: from a biosecurity perspective will now undergo identity and physical checks, which test for pests and diseases that could impact the safety of our food and harm the UK’s natural environment. Checks involve visual inspections and temperature readings of goods.
  • ‘High’ risk products: will now be checked at the border whereas previously these goods were checked at the destination. These checks will be aimed at identifying public health issues such as salmonella, and build on existing safeguarding measures which identify diseases like African Swine Fever, which is now prevalent in certain European countries and poses a significant risk for UK pig farms.

Separately, the UK Government has also published the BTOM risk categorisations and check rates for imports of live animals, products of animal origin (POAO) and animal by-products (ABPs) from the EU, Switzerland, Norway, Iceland, Liechtenstein, the Faroe Islands and Greenland to Great Britain.  The inspection rate (percentage of times a product will be subject to identity and physical checks) depends on the risk category to which it is assigned, and is set out as follows:

  • High risk commodities: will be inspected every time the product is imported (inspection rate 100%).
  • Medium risk commodities: will be inspected at a rate between 1% and 30%.
  • Low risk commodities: will not be subject to routine inspection, but they may be subject to non-routine or intelligence-led checks.

Further information on the inspection rates and associated requirements for the full range of products subject to SPS checks is available via; https://www.gov.uk/government/publications/risk-categories-for-animal-and-animal-product-imports-to-great-britain/target-operating-model-tom-risk-categories-for-animal-and-animal-product-imports-from-the-eu-to-great-britain

Importantly, checks on products entering Northern Ireland will be subject to the provisions of the Windsor Framework, which de-facto, permit Northern Ireland to continue to be part of the EU Single Market and Customs Union as regards agri-food goods.  Accordingly, none of the additional checks or controls set out in the BTOM apply to imports into Northern Ireland from the EU.

For imports coming in from Ireland (i.e. Republic of Ireland), the Border Control Posts in Wales are under construction and are unlikely to be functional until the spring of 2025.  Accordingly, the implementation of physical checks will be delayed until next year with a date to be confirmed.

In terms of the controls that have been introduced on April 30th, there have been some issues with key systems such as IPAFFS – the system used to manage the import of products subject to SPS controls.  There have also been challenges with the extent of coordination between Defra and the HMRC on issues relating to the Automatic Licence Verification System (ALVS) – the system used to match customs and SPS documentation to a given vehicle.  Whether these are just teething problems or will develop into longer-term issues remains to be seen. 

Overall, it is crucial from a biosecurity perspective for the UK to have a fully-functioning border control system and that the gaps in the system following the UK’s departure from the EU are getting addressed.  That said, such controls necessitate the imposition of friction at the border which means additional costs for businesses when importing from the EU.  This will create some inflationary pressure and will likely lead to less choice for some agri-food products, particularly those supplied by small and medium-sized enterprises (SMEs). 

Seasonal Workers Scheme Extended

The Government has announced that the Seasonal Worker Scheme will be extended for a further five years to 2029.  Visas issued will be at current levels which means 43,000 per year will be available for the horticultural sector with a further 2,000 allocated to poultry.  The industry has generally welcomed the announcement, as it allows for longer-term planning rather than the previous year-by-year decisions.  There has been some criticism that the scheme only addresses seasonal labour issues and there is still a fundamental shortage of permanent labour in the farming and food sectors.  

The announcement was made ahead of the Prime Minister’s now annual Farm-to-Fork summit at Downing Street (see https://abcbooks.co.uk/food-summit/ for details of last year’s gathering).  This year’s meeting is scheduled for the 14th May.

Infrastructure Support: Wales

The Welsh Government has announced it will be opening two schemes to support investment to prevent on-farm pollution from slurry and silage.  Both the Nutrient Management Investment Scheme (NMIS) and the Small Grants – Yard Coverings will open shortly.  In total, there will be £20m available through the schemes, with certain project costs receiving a maximum contribution of 50%; increased from 40% from when the schemes were previously open.

The full details for each scheme are expected shortly, but previously the NMIS supported capital investments in both infrastructure and in equipment and machinery that address the impact of on-farm pollution – the storage of silage, slurry and oil.  Grants of between £12,000 and £50,000 were available.  The Small Grants – Yard Coverings grant previously provided funding, up to a maximum grant of £12,000 and a minimum of £3,000 for equipment that had been pre-identified to separate rainwater and slurry from areas such as livestock feeding and gathering areas, manure storage areas and slurry/silage stores.

The Small Grants – Yard Covering scheme will open from 20th May – 28th June 2024.  The NMIS will open from 15th July until 23rd August.

The package of measures is part of the commitment under the Co-operation Agreement with Plaid Cymru, to help farmers comply with The Water Resources (Control of Agricultural Pollution) (Wales) Regulations 2021.  In response to the prolonged period of wet weather, the new Cabinet Secretary for Climate Change and Rural Affairs, Huw Irranca-Davies, recently chaired an ‘Extreme Weather Summit’ with key agricultural partners to discuss its impact on farmers and growers.  He heard of ‘significant issues in relation to slurry storage capacity’.  Anecdotal evidence reports Natural Resources Wales appear to have had a shock at how few farmers are fully compliant with these new regulations.

SFI and Countryside Stewardship Areas

Defra have published data showing the area that had been entered into each Sustainable Farming Incentive (SFI) and Countryside Stewardship (CS) action, as at 1st April 2024.  The data set also shows the area in specific Entry Level and Higher-Level Stewardship Schemes, although these are being progressively wound down.

This data covers the 13,900 SFI 2023 agreements, and 3,200 SFI 2022 agreements which were live at that time.  With applications open year-round, the data will always be slightly behind the true figure, but we expect to see the area trends continue upwards as agreement numbers increase.  As of 29th April, 20,000 farmers had applied for an SFI agreement.  A total of just 94,000 hectares is being managed under the six actions which Defra the 25% area cap on (see https://abcbooks.co.uk/sfi-cap/ ).

Of the options which run across all farming systems, 1.6 million hectares of ground is in the Soil Management Planning Standard (SAM1).  For hedgerows, over 124 thousand kilometers are now being managed under SFI and CS.

For CS, there were 34,900 live agreements, up from 32,630 a year earlier.

Arable Land under Environmental Schemes

There is still 284,000 and 211,000 hectares of arable and horticultural land being managed under the SFI 2022 scheme Introductory and Intermediate offer respectively.  These agreements will end in June.

Under both SFI 2023 and CS there is a significant volume of land now being cover cropped.  This data is the clearest evidence yet of the volume of cover cropping taking place in the England.  With payments being made on a combined total of almost 195,000 hectares.  Additionally, 94,000 hectares are managed with companion cropping.

No use of insecticide (IPM4) looked set to be an attractive option for many arable farmers, and this appears to be reality, with 430k hectares due to be managed without insecticides.  This is just over 10% of the English arable area.

There has been significant concern about the volume of ‘food’ production that could be lost in the England, due to the attractiveness of ‘non-productive’ options.  However, the Defra data shows that relatively low levels of arable cropping has moved into such actions.  Under SFI around 124,000 hectares has been placed into land use change options including the rotational legume fallow (NUM3 – 51,000 hectares).  There is also a further 22,000 hectares-worth of increases in the Countryside Stewardship non-productive arable options.

That said, the data represents a snapshot in time, with continued challenges for spring drilling in parts of England there is still significant scope for more land to be placed into these options.  This is likely to be legume fallow, although the area may then fall in future years as the option is rotational and area can be reduced by half.

Grassland under Environmental Schemes

The most immediately noticeable element of the grassland figures is the relatively low uptake of the scheme in the uplands.  This indicates one of two things, either there were limited opportunities to carry out more than is already being delivered under ELS/HLS, or the offer did not provide enough of a financial incentive.  The uplands offer will improve with the 2024 round of SFI.

There was approaching 74,000 hectares of the Moorland Assessment Plan, and just over 13,000 hectares of low input grassland in SDAs.  In addition, 97,000 hectares was being managed under the 2022 scheme.  There are also increases in upland and SDA related CS options, as farms look to bring in more revenue as BPS payments fall or ELS/HLS agreements come to an end.  The total area of farmed LFA land in England is around 1.8m hectares.

For lowland grass, in SFI 26,000 hectares has been taken out of production (IGL1-IGL3).  In terms of productive management, 101,000 hectares has been placed into low input grassland, whilst 98,000 hectares has gone into NUM2 (legumes on improved grassland).

Future increases in area for grassland actions will undoubtedly be seen, especially if farmers become more confident in managing grassland according to the prescriptions of SFI, whilst maintain or enhancing productivity.

SFI 2024

This month (May) we are expecting Defra to publish the Handbook detailing what is required under the SFI 2024 scheme.  We then anticipate a phased rollout of the scheme from this summer.

The full dataset can be found at – https://www.gov.uk/government/statistics/cs-es-and-sfi-option-uptake-data-2024.  This will be an annual publication, and a further update will be extended after 1st April 2025.

Planning Changes

The Planning rules for agriculture in England have been relaxed.  This will make it easier to convert redundant farm buildings into dwellings, or for alternative uses.  It will also allow larger new farm buildings to be erected without full Planning Permission being required.

The changes come following a consultation last summer (see https://abcbooks.co.uk/planning-rules-relaxation/ for details).  They are enacted by ‘The Town and Country Planning (General Permitted Development etc.) (England) (Amendment) Order 2024‘ and apply from 21st May 2024.  In summary, the following changes have been made;

  • New Class Q:  Class Q gives the right to develop farm buildings (modern as well as traditional) into dwellings.  Class Q has been re-written in the new legislation.  The current size restrictions will be loosened and the ‘footprint’ of buildings will be able to be extended in some circumstances.  The conversion rights are extended to buildings that are only in part-agricultural use; those that are being used for diversifications (e.g. storage); and former agricultural buildings no longer on an agricultural unit.  In the original consultation, it was proposed that these rights would be extended to areas such as AONBs and National Parks which have, until now, been excluded from Class Q.  In the event, this has not happened.
  • Extending Class R:  this allows agricultural buildings to be converted into a ‘flexible commercial use’ – storage, distribution, hotels, offices or shops.  The rights are extended to allow for food processing and also leisure uses.  The maximum area that can be convereted under this Class has been raised to 1,000 sq m.
  • Increasing Agricultural Building Sizes:  Class A currently allows farm buildings of up to 1,000 sq m to be erected on holdings of over 5 Ha without a full Planning Application being required.  This is being raised to 1,500 sq m (but the limit for livestock buildings will remain at 1,000 sq m).

The full legislation can be found at – https://www.legislation.gov.uk/uksi/2024/579/contents/made

The original consultation also included a Call for Evidence on other Planning matters, including farm infrastructure, farm diversification and environmental works.  Decisions on any rule changes in these areas are still awaited.  

Water Resources Advice

A new service for farmers to help assess water resources has been launched.  The Environment Agency is offering a ‘screening service’ which will look at water resources in a local area and offer advice on how to make them more resilient.  Funding of £1.6m is available for the service.  Groups of two or more neighbouring farmers who currently abstract, or would like to abstract, water for irrigation or livestock husbandry can apply.  Applications from groups in water-stressed areas  will be prioritised.  The closing date for applications is midnight on 16th June.  For more details see – https://www.gov.uk/guidance/local-water-resources-options-screening-studies-how-to-apply

Crop Codes

Our article last month (see https://abcbooks.co.uk/bps-claims-2024/) reported that there is no action required in order to receive the delinked BPS payment in England.  However, we also reminded CS and ES revenue agreement holders that a revenue claim would be required by 15th May.  And in so doing, it has become clear, claimants will have to visit and update their land use codes on Rural Payments as part of this process.  Following a number of queries on this the RPA has said;

‘We have received a number of questions recently as to how we will be using land use codes as part of our process for cross-checking agri-environmental scheme applications and claims. We can confirm that we will be cross-checking applications and claims against land-use codes, as we have done in previous years when the information supplied in BPS applications was used for this purpose.  Accordingly, before submitting an application or payment claim, customers should check that the land use codes recorded for their land parcels are correct and consistent with the actions/options they are applying for or claiming on. Failure to do this may lead to processing delays and hold up payments.’

It appears that it will only be necessary to check the Land Use codes on relevant parcels – i.e. ones that are in the CS/ES claim.  It does however seem a bit ‘ad hoc’ and although no one really wants to being making ‘BPS type’ alterations, with the work and cost involved, there is the issue of whether clients’ Land Use will become muddled, with some fields updated for one year and not others.

In addition, cross checking also applies to SFI applications, where Land Cover, Land Use and SFI options must all be compatible.  The 2024 Land Use codes can be found at https://www.gov.uk/government/publications/rural-payments-land-use-codes-2024/land-use-codes-2024

River Wye Action Plan

Defra has published an Action Plan to stop the decline in water quality of the River Wye and support the ongoing local efforts to fully restore it in the long term.  The plan includes nine commitments;

  • appoint a locally based ‘River Champion’ – this will be Anthea McIntyre, the former Member of the European Parliament for the West Midlands and she will establish and lead a River Wye Taskforce. This body will develop a 5-10 year catchment plan, implement it, and deliver pilot projects
  • provide up to £35 million for poultry manure combustors in the River Wye Special Area of Conservation (SAC) catchment – a one-off trial which will convert manures into nutrient-rich, more easily transportable ash
  • amend, subject to consultation, the Environmental Permitting Regulations – to prohibit the export of manures to farms where this would result in excess application of nutrients for the needs of the soil and the crop
  • help farmers retain more nutrients and soil in the field with funding for sustainable farming practices – new SFI offers from summer 2024 will support the establishment of crops using no-till techniques and the precision application of crop nutrients and plant protection products.  There will also be premium SFI payment rates for a range of high-impact actions, including £1,182 per hectare for 3-dimensional waterbody buffer strips between 6 and 24 metres wide
  • pilot the use of on-farm micro anaerobic digesters – fund up to five on-farm micro anaerobic digestors (AD) for livestock farmers in the Wye catchment through Defra Farm Trials
  • more than double grant approvals for slurry stores – including approving 100% of round 2 applications to the Slurry Infrastructure Grant (SIG) made by those in the Wye catchment and streamline Natural England’s approach to Planning consultations for grant-funded projects
  • work with partners on two Landscape Recovery (LR) projects in the catchment – provide £1.5 million of development funding over the next two years to the Wyescapes and Wye Valley Ridge to River LR projects
  • provide funding for two projects delivered with local partners in the next finacial year – the Restoring our Rivers and Arrow Valley Diversity Project.
  • carry out cross-border research on mitigating phosphate pollution in the unique geography of the area

An Action Plan for the river was promised by the Government last August, within a package of measures aimed at improving water quality in England.  The River Wye catchment is a high-profile case where water quality is adversely affected by phosphates and sediment.  The presence of large numbers of poultry units in the area is a major contributory factor.  The package of measures set out in the Action Plan can also be seen as a ‘Pilot’ for approaches that may be adopted in other catchments if it is proved to be sucessful. 

The full policy paper can be found via https://www.gov.uk/government/publications/river-wye-action-plan/river-wye-action-plan.