The next round of the Landscape Recovery (LR) scheme is now open for applications. Funding of £15m will be available to support up to 25 projects. The first round of LR last year saw 22 projects funded – initially it was proposed that 15 agreements would be offered, but with 51 applications made, the round was expanded. As its name suggests, the scheme supports ‘landscape-scale’ change – i.e. projects over significant areas. Natural England will be looking for areas of over 500 Ha to be committed (but with no upper limit on area). Projects are likely to be long term, up to 20 years, given the type of nature recovery being looked for. There is a strong presumption for private finance to be draw in alongside public funding. Applications close at midday on 21st September 2023. More details can be found at www.gov.uk/government/publications/landscape-recovery-more-information-on-how-the-scheme-will-work/landscape-recovery-round-2 . If the scheme is over-subscribed (which seems likely) the projects offering the most environmental benefits will be chosen. Defra has committed to opening another round of LR in 2024 and is looking to run annual rounds in the years thereafter – subject to funding being available.
The Government is consulting on changing the Planning rules to tighten up the rules on short-term lets; such as AirBnB. This comes after concern that the social fabric of certain coastal and rural tourist hotspots is being damaged by the volume of homes being let out to holiday-makers. The Welsh Government has already proposed similar plans. The consultation from the Department for Levelling-Up, Housing and Communities (DLUHC) proposes a new Planning Use Class (‘C5’) for dwellings being used for short-term lets. Permitted Development Rights would be introduced at the same time that would allow houses to move between permanent residencies and short-term lets – therefore, for many, there would be little practical effect from the new rules. However, the Permitted Development Rights could be suspended where a particular local issue is identified with second homes. In these cases, Planning Permission would be required if a dwelling is going to be used to a short-term let. It appears that properties already being offered as holiday accommodation will not be affected – it is only newly created short-term lets that would be affected. There is also a separate consultation on how short-term lets should be registered (so that the scale of the problem can be gauged). The legislative changes are expected to be enacted later this year. More details can be found at – https://www.gov.uk/government/news/new-holiday-let-rules-to-protect-local-people-and-support-tourism. Whilst not having a large impact on most farms and rural businesses, these new rules may make farm diversification slightly harder in the most ‘touristy’ areas.
The Bank of England raised UK Base Rates by a further 0.25% on the 11th May. This brings them up to 4.5%. It is the twelfth meeting in a row where rates have been increased as the Bank tries to control stubbornly high inflation. Expert opinion is divided as to whether this will be the end of rises or whether at least one more 0.25% increase will be seen by the summer.
The Prime Minister, Rishi Sunak, held a ‘food summit’ on the 16th May. This fulfilled a promised made in the summer when he was campaigning for the Conservative Party leadership. The ‘Farm to Fork’ meeting brought together representatives from all parts of the food supply chain, with the aim of boosting growth, driving innovation, improving sustainability and increasing resilience.
Prior to the summit, the Government announced a package of measures to help the food and farming sectors. These include;
confirmation that 45,000 visas will be available under the SAW scheme in 2024 (the same as in 2023)
a commitment in an open letter to British farmers that their interests will be protected in future trade deals (although welcome, there is likely to be a degree of scepticism in the industry following how little the industry’s concern’s were listened to when the previous deals with Australia and New Zealand were negotiated). The open letter can be seen at – https://www.gov.uk/government/publications/prime-ministers-open-letter-to-british-farmers-15-may-2022
more Government funding to promote exports, including five new Agri-food attaches, additional exposure at trade shows, and extra money for the GREAT Food & Drink campaign (see https://greatcampaign.com/campaigns/see-food-differently/). There will also be specific funds for seafood and dairy exporters
up to £30m is promised to help develop precision breeding techniques and build on the opportunities presented by the recent Precision Breeding Act
following reviews into fairness of contracts in the dairy and pigmeat sectors, similar reviews will be undertaken in the horticulture and egg sectors
a commitment that the Grocery Code Adjudicator will remain independent and not be subsumed into the Competitions and Markets Authority
a replacement for the Producer Organisation (PO) scheme in the horticulture sector when the current EU ‘legacy’ scheme ends in 2026. There is no indication of what the replacement will look like in detail. It is fairly clear that it will not be a roll-over of what is currently in place as it is stated that the new scheme will be better tailored to the needs of UK growers and will be ‘more inclusive’ – especially for glasshouse growers
a call for evidence later in the year on how red-tape (presumably Planning regulations) can be cut to help the conversion of farm buildings to diversification activities. There is also a commitment to reform the Planning regime to make the building of glasshouses easier
accelerating work on making water infrastructure more resilient to ensure agriculture has access to the supplies it needs
In terms of the summit itself, no further concrete actions have, as yet, emerged from it. Around 60-70 representatives of the food chain attended the event at 10 Downing Street, although the full list of delegates has not been made available. There has generally been a positive response to the meeting – but perhaps more due to the fact that it was happening at all, rather than any outcomes from it. The NFU has called for it to become an annual event, but the Government has, so far, not responded to this.
The Government has decided that legacy legislation derived from EU laws will not be automatically revoked at the end of the year. Under the Retained EU Law (Revocation and Reform) Bill all European-derived legislation would automatically lapse as at 31st December 2023, unless specifically retained or amended. Whitehall has so far identified 4,800 pieces of legislation that qualify. However, the auditing process is still underway and there was a strong fear that useful laws would be lost by accident. This is especially true in the area of environmental protection (Defra is the Department responsible for the greatest number of the retained laws). There was also a view that the deadline was simply unrealistic in terms of the number of laws needing to be reviewed by Civil Servants. Instead, the Bill will now specifically identify around 600 pieces of EU legislation that will be repealed. The Bill could still face significant challenges in the House of Lords as it gives Ministers increased powers to change retained EU laws without full Parliamentary scrutiny.
Defra has issued more details on how Delinking of the BPS is to work. The new information includes how business changes are to be dealt with and also the ability to transfer ‘reference amounts’ if the occupation of land has changed.
We gave brief details of the Delinked payment in February 2022 (see https://abcbooks.co.uk/lump-sum-payments/). To recap, the process is as follows;
BPS payments for the years 2024 to 2027 will not be linked to the occupation of agricultural land
payment will be based on the average of the (English) BPS received by the claimant in the three years 2020, 2021 and 2022 (this excludes any reductions for penalties or Agricultural Transition deductions). This is the ‘Reference Amount’
this Reference Amount will be paid in 2024 to 2027, subject to future Agricultural Transition deductions (which will be 100% by 2028 – i.e. no payment beyond 2027). The official deductions for 2024-2027 have not yet been set by Defra
the farmer must make a BPS claim in 2023 to ‘activate’ the Reference Amount. This can just be the minimum claim of 5 Ha and does not have to be on the same land that generated the Reference Amount
those that opted for the Lump Sum exit scheme will not be eligible for the Delinked payment
claimants will not have to apply for the payments – they will come automatically. Delinked payments will continue to be made in two parts – one in the summer and one in December
Delinked payments will not be subject to the cross-compliance regime, although farmers will still have to abide by all the legal standards that have been included under cross-compliance in the past
The new information that has come out of the latest Defra announcement includes the following;
later in 2023, all those the RPA believes are eligible for a Delinked payment will be sent a statement setting out what their Reference Amount is. It will presumably be possible to challenge this if a mistake has been made
in some cases, there will have been business changes since the start of the 2020-2022 Reference Period. This includes mergers of businesses, splits, inheritance, and the change of trading status (e.g. Partnership to Company). If this has resulted in the business having a new SBI from that in the Reference Period, the Reference Amount can be transferred to the new SBI. The new business still needs to have made a BPS claim in 2023 (apart from some inheritance cases)
it will also be possible to voluntarily transfer Reference Amounts. This might be the case if one party has given up land during the Reference Period, but they wish the new occupier to receive the benefit of Delinked payments from it until the end of the BPS in 2027. This is especially relevant in tenancy situations. Defra has stated that this will be a private matter for the parties involved whether they wish to do this – the Department will not get involved in disputes. There will be a transfer period in early 2024 to allow these changes to be made.
For the full Defra guidance see – https://www.gov.uk/guidance/delinked-payments-replacing-the-basic-payment-scheme
Three of the country’s largest farmer-owned procurement groups have formed a joint-venture to increase their buying power. Fram Farmers, Anglian Farmers (AF Group), and Woldmarsh Producers have joined forces in the ‘Agri Procurement Alliance’ (APA). This will initially be used to purchase fertiliser for members. If successful, it may grow to cover other farm inputs, but the buying groups are keen to point out this is not the start of a merger process – they will continue to operate as independent businesses.
The AHDB has released research on key competitor nations to the UK in various agricultural commodities. This looks at costs of production in the 2019-2021 period using AgriBenchmark data. Overall, it found the UK was relatively high-cost in beef and pigmeat production. It was middle-ranking in terms of cost of production for wheat, barley and lamb. For dairy products, we are quite competitive globally (but not as low-cost as New Zealand producers). The full analysis can be found at – https://ahdb.org.uk/trade-and-policy/export-opps/competitors.
A brief reminder that the last day to submit a 2023 BPS claim in England (without penalty), including Young and New Farmer applications and to transfer entitlements is 15th May. All scheme rules and details on how to claim can be found via https://www.gov.uk/government/publications/basic-payment-scheme-2023 The revenue claim window for Countryside Stewardship and Environmental Stewardship is also open and closes on 15th May.
There has been no further announcement on when the six new SFI options for 2023 will be available. When they were originally announced (see our January article) it was stated that farmers would be able to apply ‘from the summer’. A June scheme opening was suggested. But as we approach this date, no more detail has been forthcoming. As soon as we know anything, we will publish an article. Another outstanding SFI question that has yet to be answered is the question of adding Standards to existing agreements. The original rules state that an SFI agreement can be amended on its yearly anniversary. This would mean that those that have already signed-up for the Soils Standards over the past few months would have to wait some months to enter the six new 2023 SFI Standards until the anniversary rolled around. There was a view that a derogation might be available for these people to enter earlier but, again no details have been forthcoming. For those not already signed-up to the existing Standards, but considering it, we would suggest that they now wait for a couple of months for more information and, hopefully, more Standards, to become available.
