Category: Policy & Business

The Government has issued a ‘call for evidence’ on poor practices in the tenant farming sector.  This is a result of the Rock Review of the sector (see https://abcbooks.co.uk/rock-review-of-tenancies/).  Defra are seeking information on the extent and nature of poor practices, especially in the relationships between Tenants, Landlords and their Agents.  It asks whether existing dispute mechanisms are effective at dealing with bad practice and whether new arrangements are needed.  Specifically, it requests views on whether a new Code of Practice is required and if there is a role for a new Tenant Farming Commissioner to provide oversight.  The consultation can be found at – https://consult.defra.gov.uk/farm-tenancy-policy-team/da7bd616/.  The deadline for submissions is 8th February 2024.

 

Round 2 of the Slurry Infrastructure Grant (SIG) is now open in England.  This round of the scheme has £74m of funding – more than double the amount (£34m) that was eventually granted under the 1st round.  A third round has been promised in 2024 – likely to have similar funding to the current one.  There is no guarantee of the scheme continuing beyond that, as the agricultural budget has not been set beyond 2024.  Those that need to invest in slurry storage may wish to apply whilst funding is certain.  It does, however, seem likely that some support will be on offer for 2025 onwards, given the focus on water quality.  

Our article of 17th October gave a summary of the scheme including the rule changes from Round 1 (see https://abcbooks.co.uk/slurry-infrastructure-grant-2/).  Initially, those interested must apply via the Online Checker.  This will be available until 17th January 2024 and can be found via https://www.gov.uk/government/publications/slurry-infrastructure-grant-round-2-applicant-guidance/how-to-apply-for-a-slurry-infrastructure-grant-round-2

Once the Online Checker has closed, those shortlisted will be informed by the RPA.  They will receive a ‘slurry store location and design check form’.  This will need to be completed by 30th September 2024.  It will then be checked by the Environment Agency (EA) and if necessary RPA or EA may discuss changes to ensure the final project protects the environment, meets regulations and meets the needs of the applicant.  The full application including planning permission needs to be submitted by 27th June 2025 at the latest.

Defra and the Forestry Commission have announced improvements to the forestry grants available under the England Woodland Creation Offer (EWCO) and the Countryside Stewardship (CS).  Maintenance Payments will now be made for 15 years; previously these were only made for 10 years.  In addition, farmers carrying out capital works under the EWCO will now have three years to complete them.  Increasing this timeframe from two years means land owners will have two whole planting seasons to deliver the scheme, irrespective of when the agreement commences.  This gives more flexibility to plan work, secure trees and materials, and respond to weather conditions if they prevent planting from going ahead as planned.  More information on the EWCO can be found at https://www.gov.uk/guidance/england-woodland-creation-offer

 

Steve Barclay has been appointed Secretary of State for the Environment, Food and Rural Affairs.  This comes as Thérèse Coffey resigned during the Cabinet reshuffle on 13th November 2023.  Mr Barclay was previously Secretary of State for Health & Social Care between 25th October 2022 and 13th November 2023, having held the same post between 5th July 2022 and 6th September 2022.  He represents the Fenland constituency of North East Cambridgeshire and, unlike many Defra Secretaries, has shown a previous interest in farming and rural issues.  The junior Ministers in the Department, including Farming Minister Mark Spencer, remain largely unchanged.  However, Trudy Harrison has left her postion as Parliamentary Under Secretary of State.  She has been repalced by Robbie Moore, MP for Keighley and Ilkley.

The RPA has emailed all BPS claimants informing them that it will be sending out Delinked Payment Information Statements soon.  The Statements will be sent out in batches from early November; if claimaints have not received one by early December, they should contact the RPA.  The information in the Statement should be checked and any queries need to be raised with the RPA by 29th February 2024.

Delinked payments will replace BPS payments from 2024 – the 2023 claim was the last under the old Basic Payment Scheme.  The RPA will pay Delinked payments each year from 2024 to 2027.  The amount received will decrease each year as the progressive reductions apply under the Agricultural Transition.  Those in receipt of Delinked payments will not need any land or entitlements to receive the payments.

The Statements will show the ‘Reference Data’, this is based on BPS payments received in the ‘Reference Period’ – 2020, 2021 and 2022 BPS years.  The Reference Data determines the ‘Reference Amount’, basically the average yearly payment received over the three years.  This will be then be paid in each of the years from 2024 to 2027 to those that are eligible, minus the progressive reductions for that year.  Our Key Farm Facts contains details of the yearly reductions, although Defra has still not confirmed the percentages for 2025 – 2027.  To be eligible for a payment, the business must have made an eligible claim in 2023 and have a Reference Amount.  Those who received a payment under the Lump Sum Exit Scheme are not eligible. 

It will not be necessary to apply to receive Delinked payments – they will come automatically as long as the business is eligible.  The value of the  payments for 2024 to 2027 will not be affected if the farm size changes, or if there is a change in what the land is used for after BPS 2022.  Payments will be paid half from 1st August and the balance from 1st December from 2024 onwards.  Where a business receives Delinked payments, these will be taxed as income.

From 15th February to 10th May 2024, it may be possible to transfer some or all of a business’s Reference Data to another business.  This may be because there has been a change in business structure (mergers, scissions), land has changed hands, or the business may just wish to sell their ‘entitlement to the future support’.  The business receiving the Reference Data and hence the Delinked payment must have made an eligible 2023 BPS (except for some inherited land cases).  Those who have Reference Data (i.e made a claim in 2020-2022) but did not make a claim in 2023 would not be eligible to receive a Delinked payment but can still transfer their allocation to an eligible business.  More information on how to do this is expected later this year.  But RPA has made it clear that it is up to businesses if they want to transfer any of their Reference Data and it will not get involved in disputes between claimants. 

In some cases, it may only be possible to transfer the Reference Data if eligible land in England was transferred from the business transferring out the Reference Data to the business receiving the Reference Data.  The transfer of land must have happened after 15th May 2020 and before 16th May 2023.  A transfer of land is needed where the business:

• has a Reference Amount of more than £30,000 and the transfer is for only part of the Reference Data or is to more than one business – this rule is to stop Reference Data being artificially split between businesses to reduce the progressive reductions that apply
• wants to transfer out Reference Data that has been transferred to it from another business
• wants to transfer Reference Data from a business where the SBI has been closed – the SBI will be shown as ‘locked’ on the Rural Payments service and RPA will have written to the business to tell them it has closed the SBI

Further information on Delinked payment, including worked examples, can be found at https://www.gov.uk/guidance/delinked-payments-replacing-the-basic-payment-scheme

The Chancellor, Jeremy Hunt, will give his Autumn Statement on the economy on Wednesday 22nd November.  With Government finances stretched, there seems little fiscal room for new policies to be announced.  However, with a General Election in 2024 or early 2025, and the Government well behind in the polls, the Chancellor may wel be tempted to pull a ‘rabbit out of the hat’.

A few items relating to the SFI  to update readers on;

Expression of Interest (EoI)

The requirement to submit an EoI prior to a Sustainable Farming Incentive (SFI) application is no longer required.  Those who wish to apply for SFI can do so via their Rural Payments account.  However, those farming on Commons should continue to express their interest with RPA so it can help them with an application.  More information on applying can be found via https://www.gov.uk/guidance/apply-for-an-sfi-agreement .

SFI 2023 Payments

Defra has announced that those who were invited to take part early on in the ‘controlled rollout’ of SFI 2023 have received their first payment under the scheme.  Farmers whose agreement commenced on 1st October 2023 have received the ‘accelerated payment’.  This payment is worth 25% of the annual value and is paid in the first month of the agreement (see article https://abcbooks.co.uk/sfi-accelerated-payments/).  According to Defra, as of mid-October there has been over 14,000 EoIs made under the SFI and almost 1,000 agreements have been offered.

Closure Payments

All SFI 2022 agreements will be terminated and holders should all now have been informed when their agreement will end; this should coincide with a quarter end date.  Defra has said if anyone would like to leave their 2022 agreement even earlier they can contact RPA to discuss their options.  On termination, holders will receive a payment.  This could be made up of three different elements;

• a final quarterly payment
• a management payment (based on the length of time in the agreement)
• a closure payment – this is to cover any financial loss resulting from the transition from the SFI 2022 to SFI 2023.  This may not be due to all, our article https://abcbooks.co.uk/sfi-2022-closure/) detailed the closure payments.

When agreements are near their closure date, RPA will calculate the final 2022 payment due and it will write to all agreement holders detailing how to make a closure declaration.  If agreement holders have complied with their agreement requirements up to the point of closure they will not have to repay any money received.

 

A further round of the Countryside Stewardship Facilitation fund is now open for applications and will close on 15th January 2024.  The Fund supports groups of farmers and landowners in England to come together to share knowledge, coordinate action, support environmental priorities and join agri-environment schemes.  This is achieved by funding a facilitator to organise workshops and offer support, advice and training to the group.  The emphasis in this round will be on;

• increasing biodiversty and supporting priority species
• net zero
• water management (including beaver management)
• air quality

Defra has also announced some further changes to the scheme requirements, these include;

• a reduction in the minimum area per application from 2,000 Ha to 500 Ha
• removal of landlord consent
• increase in facilitator rates
• refreshment reimbursement (£10.50 per head)

There is also a new guide to help with the application process, this can be found via https://www.gov.uk/government/publications/facilitation-fund-2024-countryside-stewardship  .  The facilitator makes the application on behalf of the group.  The scheme is competitive, meaning all applications are scored and only those offering the highest scores will be offered funding.  Agreements are for three years and will commence on 1st June 2024.

Three of the four Agri-Tech centres have announced they will merge.  The three Agri-Tech Centres are Crop Health and Protection (CHAP), Centre for Innovation Excellence in Livestock (CIEL) and Agricultural Engineering, Precision and Innovation Centre (Agri-EPI Centre).

Together they are being invited to develop a proposal to establish an Agri-tech Catapult which has the support of Innovate UK.  Established by Innovate UK, there are nine existing Catapults; these are  technology and innovation centres spanning over 50 locations across the UK, which aim to transform the UK’s capability for innovation in sectors of strength.

Speaking at the UK Agri-Tech Centres’ ‘Accelerating Innovation Conference’ the three merging Agri-Tech Centres outlined how plans to become a single organisation are ‘developing at pace’ and that the new business will be a hub for agri-tech innovators to thrive and will deliver ‘huge benefits to the agri-industries sector, and to the wider UK economy’.  It will also provide advice and coordination to access critical funding and wider Innovate UK programmes, such as Horizon Europe and the Farming Innovation Programme.

The fourth Agri-tech centre, Agrimetrics, which focuses on the use of data in farming, is to remain independent.  

No agricultural trades have been included on the latest Shortage Occupation List (SOL).  This follows a major review carried out by the Migration Advisory Committee (MAC).  The report, which can be found at https://assets.publishing.service.gov.uk/media/651557b86dfda600148e37ba/Review_of_the_Shortage_Occupation_List_2023.pdf  recommends eight occupations to be included in the List.  However, none are within the food and farming industry.  This will be a major disappointment to many in the agricultural sector who are having real difficulty in recruiting labour.

However, the Committee has reported that it is not convinced that the SOL provides a sensible immigration solution to shortage issues in low-wage sectors, and says its preference is for the Government to abolish it.  Instead, it suggests that the MAC could be commissioned to examine individual occupations or sectors where labour market issues seem particularly acute, possibly in collaboration with other bodies.  Its concerns arise due to a big change under this Review.  It has been conducted on the basis of its recommendation that no employer should be able to pay below the ‘going rate’ regardless of whether there is shortage.  Previously, being on the SOL allowed employers to pay 80% of the going rate.  As a result of removing this discount, most occupations currently on the SOL are ineligible going forward.   This change would also mean that only low-wage occupations would be eligible to be listed on the SOL, leading to concerns from the Committee that this can lead to worker exploitation and higher administrative costs for employers.

The SOL identifies occupations where employers are struggling to recruit sufficiently from the domestic workforce and migration is considered an appropriate alternative.  Inclusion on the SOL grants an occupation more favourable migration conditions, with the aim to increase the number of applicants for a role and reduce labour shortages.