Category: Policy & Business

Defra has provided more information on support for farmers who suffered uninsurable damage to their land due to flooding earlier this year caused by Storm Henk.  Readers will recall we wrote about the Government activating both the Flood Recovery Framework and the Farming Recovery Fund back in January (see https://abcbooks.co.uk/flood-relief/).   Since then Defra has consulted with stakeholders and developed eligibility criteria for the Farming Recovery Fund.  This analysis has identified fields that are eligible (using satellite imagery and river gauge level data).  The parcels must be in the counties listed below and be ‘contiguous’ to (previously within 150 metres of the midpoint) one of the rivers that had notably high river level gauge readings during 2nd and 12th January 2024: 

• Gloucestershire: River Severn, River Thames and River Avon 
• Leicestershire: Rothley Brook, River Wreake and River Soar  
• Lincolnshire: River Witham, River Brant, River Welland, River Ancholme 
• Nottinghamshire : River Trent, River Devon and River Soar 
• Somerset: River Brue, River Exe, River Parrott and River Tone 
• Warwickshire: River Avon and River Leam 
• West Northants: River Nene and River Great Ouse 
• Wiltshire: River Avon (Hants), River Avon (Bristol), River Kennet, River Thames, River Bourne and River Wylye 
• Worcestershire: River Severn, River Teme and River Avon 

We understand eligible farmers are being written to directly by Rural Payments Agency (RPA) outlining the support available to them and how they can make a claim, this is expected to be a simple form which needs checking and returning by 10th July.  The amount is £130 per hectare, with a minimum payment of £500 and a maximum of £25,000.  This is to return the land to the condition it was in before exceptional flooding due to Storm Henk.  The RPA will indicate how many hectares of land is eligible in its communication with farmers.

Initially the the fund will be available to those in the areas outlined above which have experienced the highest levels of flooding, but Defra has said eligibility for the fund will remain under review to ensure it is supporting areas where farmland is most impacted, in particular the counties of Berkshire, Herefordshire, Oxfordshire, Surrey, Staffordshire, Yorkshire, Norfolk and Derbyshire.  Of course, the winter has been exceptionally wet with much ‘generalised’ flooding at various times in numerous locations. This grant is specifically for the flooding caused by Storm Henk from 2nd-12th January 2024 and there is no indication that any other rainfall events will be added.

Defra has opened a new scheme to help improve the water environment England.  The Water Restoration Fund is funded through environmental fines and penalties issued to water companies between April 2022 and October 2023.  It is focused on restoring and improving inland rivers, streams and their headwaters (including chalk streams), canals, lakes, ponds, wetlands (including freshwater and saltwater wetlands) and estuarine waters in the specified geographical areas where fines and penalties from water and sewerage companies have accrued.   The project must also be in an area in which sewage collection and treatment is provided by;

• Thames Water – £3,334,000 available
• Yorkshire Water – £1,600,750 available
• Anglian Water – £3,085,000 available
• United Utilities – £800,000 available
• South West Water – £2,150,000 available

Local groups and farm clusters are encouraged to work together to deliver projects at a catchment-level with integrated outcomes and which address multiple objectives where possible.  The Fund is a competitive grant scheme and is limited to the specified geographical areas and funds for each area shown above.  Applications will be assessed against the scheme objectives, value for money and each other.

There are two grants available, which can cover up to 100% of eligible costs.

• Development awards – short-term grants to build capability and help design and plan future projects.  Grant value from £75,000 to £250,000. The project length is 6 to 12 months and starts from July 2024.
• Delivery awards – medium to long-term grants to help carry out projects already planned.  The project should begin as soon as possible after receiving a grant funding agreement.  Grant value from £500,000 to £2 million.  The project length is 12 to 30 months starting from July 2024 and ending by 31st March 2027.

Applications for both grants are open from 9^th April until 11.59pm on Friday 7^th June 2024.  Further information is available via https://www.gov.uk/government/publications/water-restoration-fund-guidance-for-applicants/about-the-water-restoration-fund.

The Scottish Government has provided more details of the ‘conditionality’ that will apply to farm payments in 2025.  This is included in an update to its Agricultural Reform Route Map (see https://www.ruralpayments.org/topics/agricultural-reform-programme/arp-route-map/ for details).

There are three main elements for 2025;

• New Cross-compliance Rules:  new measures are to be introduced to protect peatland and wetland.  These will be included under GAEC6 – Maintenance of Soil Organic Matter (there was originally plans to have them as a new stand-alone GAEC8).  It will apply to peat soils of over 50cm depth and with a ‘near natural vegetative cover’ – i.e. unimproved land.  There will be prohibitions on fertiliser, pesticides, herbicides, cultivations and any drainage works
• Calving Index:  for those claiming the Scottish Suckled Beef Support Scheme (SSBSS) headage payment, there will be a new condition on calving index.  Payment will only be made on calves coming from cows with an interval of 410 days or less.  This will be on a cow-by-cow basis, and not on a herd-average.  First-calvers will be exempt from the rules.  The Scottish Government outlines that the calving interval threshold may reduce in future years, but it will not reduce by more than 10 days in any given year.
• Whole Farm Plan:  the requirements for this are gradually being phased-in.  For 2025, farmers will need to indicate on their Single Application Form that they have done at least two of the following five activities.
  • Carbon Audit – done within the previous five years prior to May 2025
  • Biodiversity Audit – done within the previous five years prior to May 2025
  • Soil Analysis – done within the previous five years prior to May 2025 
  • Animal Health and Welfare Plan – to be updated annually
  • Integrated Pest Management Plan – to be updated annually

The Scottish Government points out that there is currently funding for Carbon Audits and Soil analysis through the Preparing for Sustainable Farming programme.

Detailed guidance on the conditionality rules for 2025 and more information about the actions farmers and crofters will need to take in 2026, will be announced in summer 2024.

Red Tractor has officially announced that it will drop its proposed ‘Greener Farms’ environmental bolt-on to its Farm Assurance standards.  This comes after widespread producer concern over additional compliance costs and the way the new standards were developed and announced.  Meanwhile, an independent review has been jointly commissioned by the NFU and AHDB along with NFU Cymru, the Ulster Farmers’ Union and NFU Scotland.  This will be a wholesale review of ‘Farm to Fork’ assurance and aims to ensure that UK schemes and practices are fit for purpose.  More details can be found at – https://www.nfuonline.com/updates-and-information/industry-wide-assurance-review-officially-launched/ .

UK Minimum Wages rise as from the 1st April.  The main National Living Wage rises to £11.44 per hour from £10.42 – an increase of 9.8%.  The Living Wage also now applies to anyone 21 years old or over – previously it was only for those 25+.  All this adds considerably to costs for those farming and horticultural businesses employing a lot of staff.  England no longer has an Agricultural Wages Board, but they continue to operate in Wales and Scotland.  These also change their rates from the 1st April.  Rates are set to be compliant with Minimum Wage rates, but there are also supplements based on experience etc.  The Welsh Wages Order for 2024 can be found at – https://gov.wales/agricultural-wages and the equivalent for Scotland at – https://www.gov.scot/publications/agricultural-wages-scotland-twenty-eighth-edition-guide-workers-employers/.

There has been a re-shuffle of the Welsh Cabinet following the appointment of Vaughan Gething as First Minister.  This has seen Lesley Griffiths be replaced by Huw Irranca-Davies as Rural Affairs Minister, which covers the farming brief.  In fact, Mr Irranca-Davies’ portfolio has expanded, as he is Minister for Climate Change and Rural Affairs.

England

It seems increasingly clear that farmers (and their advisors) will not have to do anything to claim their de-linked BPS payments this year.  Defra and the RPA have been silent on what might be required.  In the absence of information, there was speculation that claimants might, at the least, have to tick-a-box to indicate they still existed.  There was a school of thought that Defra would not want to give up on the information provided by the annual BPS application, and that some sort of field-by-field submission would still be required.  However, whilst there has been no formal announcment from Defra, ‘stakeholders’ are clearly stating that those due delinked payments will not have to do anything.  The money will simply be paid into bank accounts.  It will come in two tranches – half in August and half in December.  Those budgeting should remember that there will be further progressive reductions this year as the BPS phase-out continues.  See Key Farm Facts for details.

Farmers in England should remember that the deadline for transfering delinked Reference Amounts is the 10th May.  See our article of last month for more details.

One final point is on Countryside Stewardship and Environmental Stewardship revenue claims.  The deadline for these is the 15th May.  These were often done as part of the the overall ‘BPS process’.  With a BPS form to trigger the work, they may get overlooked.

Scotland, Wales & N.I.

Of course, the BPS carries on unchanged in the rest of the UK for the 2024 year.  None of the devloved regions is instituting radical change to their BPS systems for 2024 as all have plans to reform farm support sooner or later.  Therefore, for most, the rules and forms remain unchanged from 2023.  The deadline for the submission of forms is the usual 15th May.  In Wales the entitlement trading deadline is also the 15th May.  In Scotland it is 2nd April.

Defra has provided an update on the development of private nature markets.  This sees companies, organisations and individuals paying for improvements to nature, rather than relying on Government funding.  Defra has an ambition to see £500 million per year coming from these sources by 2027 and rising to £1 billion by 2030.  The paper points to some progress being made – notably the introduction of mandatory Biodiversity Net Gain and the development of Nutrient Neutrality markets.  However, away from these markets created by regulation, we see little evidence of much money being generated for nature from the private sector.  The target of £1bn seems some way away.  The report can be seen at – https://www.gov.uk/government/publications/nature-markets-framework-progress-update-march-2024/nature-markets-framework-progress-update-march-2024#palladium

Defra has announced it will be applying a limit to the area SFI applicants can put into six specific SFI options that are currently available.  Under the announcement made today (25th March), SFI applicants will only be able to put 25% of their land into the following actions that take land out of direct food production;

• Flower-rich grass margins – IPM2
• Pollen and nectar flower mix – AHL1
• Winter bird food on arable and horticultural land – AHL2
• Grassy field corners and blocks – AHL3
• Improved grassland field corners or blocks out of management – IGL1
• Winter bird food on improved grassland – IGL2

The cap will come into effect from midnight tonight (25th March).  After this date Defra will not accept applications where the amount of land in total that is entered into any combination of the above actions is above 25% of a farm’s total land.  Furthermore, Defra has said ‘we want to emphasise that we would expect no more than 25% of a land parcel to be entered into IGL1, AHL3 and IPM2′.  It doesn’t particularly say whether applications wouldn’t be accepted if this was the case.

The new rules do not apply to;

• existing SFI agreements
• any SFI application that is already in progress
• SFI agreements that have already been offered to applicants 

In recent weeks there has been coverage in the media of farmers putting large areas, or even whole farms into these actions.  Defra has been saying that there has only been limited evidence to date of this, but it now acknowledges that some of these actions are ‘being used more than intended in a small number of cases’.  It says the changes ‘will ensure the scheme continues to support farmers to produce food sustainably alongside improving the environment’.

The Farming Equipment and Technology Fund (FETF) is now open for applications for the Animal Health and Welfare grants.  Our article last month (see https://abcbooks.co.uk/grants-for-equipment-technology/) gave details of the grant.  In summary, this provides funding towards items of equipment and technology that have been pre-identified by Defra to help improve animal health and welfare on farms.  There are over 130 items on the list and 29 are new additions.  The minimum grant is £1,000 and the maximum is £25,000 and, under the Animal Health and Welfare grant, applicants can receive 50% towards the lower of either the cost set out on the list or the actual cost paid for the item.

Applications are scored (each item has a score), so it is possible not everyone will receive a grant, but applicants can increase their score by 20% if they provide evidence that they have discussed the application with a vet.

The application window runs until 1st May 2024.  The full guidance can be found at https://www.gov.uk/government/publications/farming-equipment-and-technology-fund-2024.  Applications are made using the new Farming Investment Fund (FIF) application service – this is separate to the Rural Payments service and requires a complete new registration.  A reminder that the application window for the Productivity and Slurry Management grants via the FETF opened earlier in the month (see https://abcbooks.co.uk/productivity-and-slurry-grants-open/) and runs until midday on 17th April 2024.