Category: Policy & Business

Woodlands

The 2nd Round of the Woodland Restoration Scheme (WRS) opened for Expressions of Interest on 16th December and will close on 2nd February 2023.  The WRS provides capital works for restocking, fencing and associated operations on sites where there is Larch and up to 50% non-Larch species.  Further information can be found via https://www.gov.wales/woodland-restoration-scheme-round-2-rules-booklet-html.

The next window for applications to the Woodland Creation grants opens from 13th February to 24th March 2023.  This is for the Small Grants – Woodland Creation scheme, which covers small areas of tree planting under 2 hectares and also for the Woodland Creation Grant, covering larger schemes in excess of 2 hectares.  For further information go to https://www.gov.wales/small-grants-woodland-creation  and https://www.gov.wales/woodland-creation-grants-booklet .

Winter Update

The Welsh Government has also published its Winter Update, which can be found online at https://www.gov.wales/sites/default/files/publications/2022-11/agriculture-winter-update-2022.pdf.  This is a 36 page document updating land managers on a variety of rural topics including scheme opening dates (see table below), the Sustainable Farming Scheme, agricultural minimum wage, EIDCymru, Farming Connect, animal health and welfare and more.

Farming Connect Boot Camp

The Farming Connect Boot Camp is a fully-funded residential course designed to give new entrants into agriculture the skills to be able to develop efficient businesses.  The first session is on 18th and 19th January with the second session running from 8th -10th February 2023.  More information can be found at https://businesswales.gov.wales/farmingconnect/business/business-bootcamp

After a brief closure, applications for Countryside Stewardship Capital Grants have re-opened, with some changes to try and provide further flexibility to applicants and an update to payment rates.  The full guidance can be found at https://www.gov.uk/government/publications/capital-grants-2023-countryside-stewardship/applicants-guide-capital-grants-2023. The main changes include;

• Agreements increased to 3-years – all agreements starting on or after 5th January 2023 will have 3-years (previously 2-years) to complete the agreed works
• New CS Higher Tier Capital Grants – to be used in the most environmentally significant sites and woodlands without the need for a CS Higher Tier agreement.  20 capital items are available under this new tier.  For further information go to https://www.gov.uk/government/publications/higher-tier-capital-grants-2023-countryside-stewardship/applicants-guide-higher-tier-capital-grants-2023
• New Natural Flood Management theme – this offers 3 capital items and increases the maximum limit for a single application to £80,000, with a limit of £20,000 for each group;
  • Boundaries, trees and orchards
  • Water quality
  • Air quality
  • Natural flood management (new for 2023) – equipment to disrupt tramlines and leaky wooden dams
• Updated payment rates – the majority of capital grants have been increased for agreements commencing from 5th January 2023 i.e. Hedgerow planting (BN11) is now £22.97 per m (previously £11.60 per m) and Hedgerow laying is £13.52 per m (£9.40 per m).  There are, however, a few which have declined and some have remained the same.  Defra say, on average, the rates have increased by 48%. The new rates can be found at https://www.gov.uk/government/publications/capital-payment-rates-from-january-2023-countryside-stewardship
• Land in an SSSI now eligible – previously not eligible, but land located in an SSSI is now eligible for capital works if the land is already in and existing CS or ES agreement
• Proportionate reductions on late claims – reductions will be scaled back depending on how late a claim is.  Currently if a claim is one day late, 100% reduction is applied.
• Catchment Sensitive Farming (CSF) – capital items which require support from CSF are now available in High, Medium or Low Priority Areas for Water and Air quality
• Public Access and Educational Visits – the eligibility of some items has been expanded to encourage public access and enhanced educational visits to woodland.

A reminder that applications to CS Capital Grants and CS Higher Tier Capital Grants can be made all year round.

 

Defra has announced an update to the Countryside Stewardship (CS) payment rates and the introduction of the Sustainable Farming Incentive (SFI) Management Payment.  Both are following feedback from farmers and in recognition that prices have increased and that Defra needs to ensure the schemes are viable to attract all businesses.

Sustainable Farming Incentive Management Payment

The SFI Management Payment will be £20 per hectare for up to 50 hectares of land entered into the scheme per annum i.e. agreement holders will receive up to a maximum of £1,000 per year via this payment.  The payment has been introduced following feedback from those already in the scheme who have said the current payments do not fully account for the administration costs of entering and implementing an agreement.  Defra acknowledges the new Management Payment will benefit small farms in particular, but it notes these are currently half as likely as the average farm to be in an environmental land management scheme.  It has been fairly well documented that uptake of the SFI has been poor and that payments are considered to be too low.  An increase in uptake is required if Defra is to meet its environmental targets.

The SFI Management Payment will apply to new agreements and also those already participating.  It will not apply to those in the SFI Pilot who already receive £5,000 per year for taking part in ‘learning activities’.  Defra states that this Pilot payment will be reviewed for the 3rd year, but it is unclear what this actually means.  The Management Payment will only be available for agreements that include changing land management activities, meaning planning or preparation activities such as the current Moorland Standard are not eligible.  More information on the SFI Management Payment is expected before the end of the month.

SFI – Additional Standards

Defra is expected to announce further SFI Standards for 2023 shortly.  At the Oxford Farming Conference in early January the Farming Minister, Mark Spencer, stated that a further six Standards will be available.  Details are expected in the coming weeks, but our understanding is that the following topics will be covered;

• Arable and Horticultural Land Standard (as distinct from the current Soils Standard)
• Improved Grassland Land Standard
• Low Input Grassland
• Hedgerow
• Integrated Pest Management (IPM)
• Nutrient Management

Countryside Stewardship Payment Rates

Our previous article reports on the updates to schemes rules and payment rates for CS Capital Grants (see https://abcbooks.co.uk/countryside-stew…al-grants-update/).  CS revenue rates have also been updated and will be introduced for all new and existing Mid Tier and Higher Tier agreements as from 1st January 2023.  The majority of payment rates have increased, none have been reduced, with about 20 remaining unchanged.  The new rates can be found at https://www.gov.uk/government/publications/revenue-payment-rates-from-january-2023-countryside-stewardship.  Defra has said it will continue to review payment rates, in addition, later this year it will publish how it will ‘routinely review’ rates from 2024.

The legally binding environmental targets, as required under the 2021 Environment Act, have finally been published.  We wrote in the November Bulletin that Defra had missed the statutory deadline of 31st October as set out in the Act.  A Ministerial Statement to the House of Lords on the 16th December set out thirteen targets in a number of areas.  The targets are largely the same as was set out in earlier Defra consultations, so contain few surprises.  Details can be found at www.gov.uk/government/news/new-legally-binding-environment-targets-set-out .

The targets are;

Biodiversity and Woodland

• To halt the decline in species abundance by 2030
• To ensure that species abundance in 2042 is greater than in 2022, and at least 10% greater than 2030
• Improve the Red List Index for England for species extinction risk by 2042, compared to 2022 levels
• To restore or create in excess of 500,000 hectares of a range of wildlife-rich habitat outside protected sites by 2042, compared to 2022 levels
• 70% of the designated features in the Marine Protected Areas network to be in favourable condition by 2042, with the remainder in recovering condition
• Increase total tree and woodland cover from 14.5% of land area now to 16.5% by 2050 (the original target in the consultation had been 17.5%)

Water Quality and Availability

• Abandoned metal mines target: Halve the length of rivers polluted by harmful metals from abandoned mines by 2038, against a baseline of around 1,500 km
• Agriculture target: Reduce nitrogen (N), phosphorus (P) and sediment pollution from agriculture into the water environment by at least 40% by 2038, compared to a 2018 baseline
• Wastewater target: Reduce phosphorus loadings from treated wastewater by 80% by 2038 against a 2020 baseline
• Water Demand Target: Reduce the use of public water supply in England per head of population by 20% from the 2019/20 baseline reporting year figures, by 2037/38

Waste & Air Quality

• Reduce residual waste (excluding major mineral wastes) kg per capita by 50% by 2042 from 2019 levels
• For air quality, an Annual Mean Concentration Target for PM2.5 levels in England to be 10 µg m-3 or below by 2040
• A Population Exposure Reduction Target for a reduction in PM2.5 population exposure of 35% compared to 2018 to be achieved by 2040.

Although not all are directly relevant to agriculture, it can clearly be seen that some of these targets will affect farming.  Now these legal targets are in place the Government has a duty to enact policies to achieve them.  The roadmap for how this is to be done will be the Environmental Improvement Plan (EIP).  This is due to be published in January and will be updated every five years.  It is the successor to the 25-Year Environment Plan.

Defra has published the cross-compliance rules for 2023.  There are no changes to the existing rules.  Full details can be found at – www.gov.uk/government/publications/cross-compliance-2023/cross-compliance-2023.  This should be the last year of cross-compliance in its current form.  In 2024 the residual BPS payments in England are to be ‘de-linked’ – with the link between payments and land being removed.  At this point the cross-compliance system no longer works.  A replacement system for ensuring farming standards is likely to be drawn up during 2023.  

Scottish farmers will see the levels of their direct payments remain the same in 2023.  This is a result of the Scottish Government Budget announced on the 15th December.

Funding for Basic Payments, Greening and Voluntary Coupled support remains at £485 million for 2023.  However, it must be noted that, with inflation at 10% plus, the actual value of these payments falls considerably.  The budget for LFASS has also be retained at the same nominal level as 2022, at £65m.  The Agri Environment Climate Scheme (AECS) is held at £35.8 million whilst funding for the Agricultural Reform Programme (including the National Test programme) increases from £23 million to £39 million.

The Budget also saw an announcement on increases in the level of Scottish Income Tax;

• The Higher Rate (payable above £43,663) will increase from the current 41% to 42%
• The Top Rate (in future payable after £125,140 rather than the current £150,000) will rise from 46% to 47% as from April

The extra funds raised will be targeted at the NHS.  Full details of the Budget can be found at – www.gov.scot/publications/scottish-budget-2023-24/

Rural Affairs Minister, Lesley Griffiths has confirmed that Welsh farmers will continue to receive the BPS at current levels in 2023 and 2024 (subject to budget).  The announcement has been welcomed by the Welsh farming industry and will provide some certainty for the sector.  However, the Rural Affairs Minister has accused the UK Government of ‘continually refusing to review the farm funding methodology…’ and its ‘continued failure to adjust funding levels to deal with rising costs exacerbates the impact on their economic mismanagement on Welsh farmers’.  The Minister went on to say that it is therefore even more important to transition to the new Sustainable Farming Scheme which is ‘fairer and which will support our farmers in the sustainable production of food’, confirming this scheme will commence from 2025.

The Government has increased the number of workers that will able to come to the UK under seasonal working visas.  The Seasonal Agricultural Workers Scheme (SAWS) will have 45,000 potential places in 2023 – up from 30,000 in 2022.  There will also be the potential to increase numbers by a further 10,000 if necessary.  The Government will also be appointing new operators to help administer the scheme.  Foreign workers are allowed to come to the UK for up to 6 months under the scheme.  Further details can be found at – www.gov.uk/government/news/government-provides-boost-to-horticulture-industry-with-certainty-over-seasonal-workers.  The first 4,000 visas will be made available to operators imminently to ensure that daffodil growers have the labour available for their harvest at the start of the year.

With labour being such a key issue, this is positive news for the farming industry – especially the fresh produce sector.  It is a welcome U-turn from last year when the industry was told 30,000 will be made available for 2022 but numbers would then taper down in 2023 and 2024 and disappear completely by 2025.  It seems that the Government has been listening to the problems of the industry.  However, with announcements on numbers being made on a yearly basis, and very late-in-the day, it provides no long-term certainty to allow businesses to invest in the fruit and veg sector.  Many producers have already scaled-back their cropping plans for 2023 due to uncertainty over labour (and low margins in 2022).  A longer-term solution is needed. 

More details are emerging of a new scheme which could provide an additional income stream for some farmers.  Readers will recall we wrote about the introduction of a Nutrient Mitigation Scheme back in August (see https://abcbooks.co.uk/nutrient-mitigation-scheme/), Natural England has now released further information.  Defra and the Department for Levelling Up, Housing and Communities (DLUHC) are investing up to £30 million over the next three years to fund the Natural England-led Nutrient Mitigation Scheme (NMS).  Since the announcement in the summer, Defra and Natural England have been working with partners, such as the Wildlife Trusts, in affected catchments to ‘identify and develop’ additional mitigation projects.  The first projects are now being negotiated with two partners in the Tees catchment, with feasibility studies underway in a further five catchments.  Furthermore as from December, landowners within targeted areas are being approached to invite them to offer their land as sites for nutrient mitigation schemes.  These will then be used by Local Planning Authorities (LPAs) and developers to unlock the building of new homes across the country, whilst also contributing to nature recovery via the creation of new wetlands.   This framework will eventually be expanded across the country.

The scheme will be fully launched from March 2023 when Natural England will invite applications from developers to purchase certificates or credits.  The certificates can then be submitted by the developer to the LPA as part of the Planning process to show that nutrient neutrality planning conditions have been satisfied.  Full details of the scheme are not yet available, but developers will be given information on credit availability and price ahead of the first credit sales.  Natural England is working with LPAs and other partners to identify opportunity and need in each catchment – it is recognised that the scheme will develop at different rates in different catchments.  Natural England will be accrediting the mitigation schemes according to ‘environmentally robust standards’.

It is envisaged that as the scheme is rolled out into each catchment, credits will be offered in batches and any developer requiring credits will be able to apply for them.  The scheme will be designed so that banking of credits by developers is not allowed.  It will still be possible for developers to source credits from other markets or suppliers, via on-site features or through their own off-site nutrient mitigation plan.

Potentially this could be another income stream for landowners who have suitable areas of land, but crucially there is no indication of how payments will be made to landowners – establishment and maintenance, annual, lump sum or even how much?  Also, how long will agreements be for?  Similar to many of these ‘new’ income streams, more information is required but it is worth keeping an eye on.

 

 

 

 

The Farming Futures: Automation and Robotics, Industrial Research Fund, which we first reported on in October (see https://abcbooks.co.uk/horticulture-support/) will open for applications from 9th January 2023.  Details of the fund have been made available online ahead of this date and can be found at https://apply-for-innovation-funding.service.gov.uk/competition/1380/overview/2457c13f-ab6a-4a88-9f81-812f5f6e2d52?_ga=2.179995300.1603189312.1670842557-230918486.1663164674#summary .  This fund is part of the Farming Innovation Programme delivered in partnership with UKRI’s Transforming Food Production Challenge.  This is the third round of competitions under this fund and it aims to support collaborative development projects with ‘ambitious solutions’ for robotics and automation in both agriculture and horticulture to:

• support specific recommendations for automation innovation funding from recent Defra reviews and the Government Food Strategy
• address key issues affecting the sector, where automation and robotics can mitigate labour challenges and increase productivity.

Proposals must be able to demonstrate how the project will benefit farmers or growers in England.  This competition is split into two strands:

• Strand 1 –  industrial research; accelerating collaborative R&D with the UK’s world-leading research base, agri-tech businesses, SMEs and the UK agricultural sector to develop innovations in agriculture and horticulture
• Strand 2 –  experimental development; accelerating the deployment and uptake of innovation for robotics and automation in agriculture and horticulture that is almost at commercial stage

Under this round there is £12.5m of funds available.  Total project costs must be between £500,000 and £1m.  The deadline for applications is 11am on Wednesday 15th March 2023.