Category: Policy & Business

The initial stage of the Sustainable Farming Incentive (SFI) launched on 30th June.  There is no deadline date for applications, those interested can apply when it suits them best.  Payment is expected to be three months after application – this implies agreements will be offered relatively quickly and a lot faster than CS offers.  The aim is then to have quarterly payments, with no need to make a claim for payment.  To make the process as ‘straightforward and quick as possible’ applications will be online via new functionality on farmers’ RPA accounts.  This will allow checks to be carried out automatically and enable applications to be processed must faster.  However, this functionality may not be available to everyone during July; those that do not have the SFI functionality available during this initial period should get in touch with the RPA who will be able to support them through the application process.

It is important that applicant’s details are all up to date on the Rural Payments service.  Check digital maps are correct, as this will affect land parcels you can select to include in the application.  The online application should show the area eligible for SFI for each land parcel.

SFI & CS Interaction

Where a land parcel is entered into another scheme it may be eligible for SFI, but this is much more limited than expected.  We had been led (like many others) to believe that the initial Soil Standards could be put on CS agreement land as there is no overlap.  However, it seems that this is not the case and there are only a limited number of CS options that are also eligible for SFI.  Tables 1 and 2 in the following guidance show which options can be used on the same area https://www.gov.uk/guidance/how-an-sfi-standards-agreement-interacts-with-other-funding-schemes.  It therefore becomes somewhat either/or whether to go for SFI or CS Wildlife package, for example.  However, if part of a land parcel is used for a CS revenue option not listed in tables 1 and 2, and cannot be entered into the Soils Standards, it is possible to enter the rest of the land parcel into either of the Soils Standards.  For example, if part of a land parcel is used for a CS grass buffer strip, it will be possible to enter the rest of the area into either of the Soils Standards.

This may seem to many quite complicated!  But to help, if the applicant has an existing CS agreement, the RPA automatically removes the area of ineligible CS revenue options from the affected land parcels in the SFI application.  This includes any area currently used for ineligible rotational CS revenue options.  This will mean those who are not in CS, will need to weigh-up whether to go for just an SFI or a CS agreement or a mixture of both.

The UK launched Free Trade Agreement (FTA) negotiations with the Gulf Cooperation Council (GCC) on 22nd June.  This is seen as a lucrative market for British producers.  The GCC is made up of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE.  It is home to more than 57 million people, with a large (and expanding tourism industry).  It is the the richest region in the Middle East, with a high standard of living and with the lack of farmland imports approximately 90% of the food it consumes.  Tariffs on UK agri-food products to the region are already set relatively low but negotiators should seek to remove tarriffs where they exist.  The region is a large consumer of sheep meat, currently the main suppliers are Australia and New Zealand, but the removal of the 5% tariff on frozen lamb would support UK lamb exports to the region, which have already grown by 652% between 2018 and 2019.

Defra has confirmed the Sustainable Farming Incentive (SFI) will open for applications from 30th June.  This is the first part of the Environmental Land Management (ELM) programme to be put into practice.  Initially, just three Standards; Arable and Horticultural Soils, Improved Grassland Soils, and Moorland will be available.  Our articles of the of the 31st March and 27th May give further information.

Scotland is consulting on a new Biodiversity Strategy aimed at halting nature loss by 2030 and reversing it by 2045.  According to the Scottish Government, the Strategy will lead into the development of ‘rolling delivery plans’ and, through the introduction of a Natural Environment Bill, statutory nature restoration targets.  For further information and to provide views go to https://consult.gov.scot/environment-forestry/scottish-biodiversity-strategy-2022/.  The consultation closes on 12th September 2022.

Rural Affairs Secretary Mairi Gougeon has announced, subject to the approval of the Scottish Parliament, that farmers and crofters will receive their advance payment for the 2022 Basic Payment Scheme (BPS) around a month earlier than originally planned.  This year payments will start to be issued from 19th September instead of 16th October 2022 to try and help farmers’ cash flow, given the sharp increases in costs.  It is unclear what percentage the advance payment will be.  Last year it was 90% and farmers and crofters had to apply for it.  But the Minister has also cautioned that, although the start date has been brought forward, payment targets remain the same – to pay over 70% anticipated expenditure by end of December 2022 and 95.24% anticipated expenditure by the end of February 2023.

Increased funding for peatland and woodland restoration in Scotland has been announced.  The plans have been published in the Scottish Government’s latest Resource Spending Review, as Net Zero Secretary, Michael, Matheson, pledges to maximise the use of public funding to accelerate the delivery of plans to tackle climate change.  As well as increasing spending on delivering the Heat in Building Strategy and active travel, up to £95m has been committed towards meeting woodland creation targets of 18,000 by 2024/25.  A further £12m has been committed to peatland restoration, to double the current rate.

The Welsh Government is asking farmers and other members of the rural community to help with co-designing the Sustainable Farming Scheme (SFS).  Phase 1 has already been completed, the next phase of co-design will be launched some time over the summer and those interested are being asked to register now.  Registration can be made via https://gov.wales/co-design-sustainable-farming-scheme-wales   The SFS will be the main farm support in Wales in the future, replacing the current BPS and Glastir.

Changes to Welsh residential tenancy legislation has been delayed.  The (long awaited) Renting Homes (Wales) Act 2016 should have come into force on 15th July 2022, but has now been postponed until 1st December 2022.  Our article of 25th April (see https://abcbooks.co.uk/welsh-residential-tenancies/) outlined the changes the Act will introduce, the main one being the replacement of Assured Shorthold Tenancies.  But following representations from Landlords, citing pressures from Covid recovery and supporting those fleeing the war in Ukraine, in a Written Statement, the Minister for Climate Change has said this type of change is ‘perhaps once in a generation’ and ‘I want to do all I can to ensure Landlords have adequate time to make the necessary preparations to comply with the requirements of the Act’.  The title of the legislation ‘…..2016’ gives away how long we have been ‘talking’ about this Act (!)

The Government’s much-delayed Food Strategy has been met with a mixed reception on its eventual release.  The White Paper responds to the recommendations made by Henry Dimbleby in his independent review of the food sector (see https://www.gov.uk/government/publications/national-food-strategy-for-england).  Not all of Mr Dimbleby’s recommendations have been accepted.  Notably, more contentious proposals such as a salt and sugar tax, expansion of free school meals, and a 30% target to reduce meat consumption have been shelved.  Henry Dimbleby himself has commented – “It’s not a strategy.”  “It doesn’t set out a clear vision as to why we have the problems we have now and it doesn’t set out what needs to be done.”

The Strategy mainly relates to England, as food policy is devolved.  It has three broad objectives.  These are to deliver;

• a prosperous agri-food and seafood sector that ensures a secure food supply in an unpredictable world and contributes to the levelling up agenda through good quality jobs around the country
• a sustainable, nature positive, affordable food system that provides choice and access to high quality products that support healthier and home-grown diets for all
• trade that provides export opportunities and consumer choice through imports, without compromising our regulatory standards for food, whether produced domestically or imported

Each is looked at in turn below, with some of the key policy measures highlighted.

Secure Food Supply

The report highlights that the UK produces around three-quarters of the indigenous food (i.e. that which can be grown in the UK) which is consumed here.  The Strategy commits to ‘broadly maintain the current level of food we produce domestically’.  This rather vague assertion is not backed-up by any specific policy action, although there is to be a focus on boosting the horticulture and seafood sectors (see below).  Other policies under this heading include;

• there is a restatement that the Agricultural Transition, including ELMs and productivity measures will deliver sufficient production whilst also meeting environmental goals.  Effectively, nothing in the Food Strategy changes the direction of English farm policy – there is no turn away from environmental polices which some believed the current global food crisis warrants
• buried within the Strategy is the phrase that ELM funding will be ‘responsive to farmer demand’.  This is widely taken to mean that the funding split between the three parts of ELM will no longer be broadly equal, with more being channeled via the SFI (largely at the expense of Landscape Recovery)
• next year, the Government intends to publish a Land Use Framework for England, setting out how land can be best used to meet the many policy pressures it faces
• there will be funding for farming innovation programmes.  Also, the AHDB will be tasked with setting up a ‘What Works Centre’ to share best practice across the farming industry.
• skills in farming will be boosted by the formal launch in 2023 of the new Institute for Agriculture and Horticulture (TIAH)
• the Strategy would like to see a boost in what it calls ‘industrial horticulture’ – large-scale glasshouses.  To this end it will be considered alongside other manufacturing sectors in decisions on industrial energy policy.  The Planning process will also be reviewed to support new developments and there will be incentives to use surplus heat and CO2
• any growth in horticulture will be dependent on having adequate labour.   In the short-term, it has been announced that the extra 10,000 places (on top of the basic 30,000) under the Seasonal Workers Scheme will be made available for 2022.  There will be a review of the way the Shortage Occupation List works under the visa regime by the Migration Advisory Committee (MAC).  However, the Strategy states that ‘the [food] sector cannot sustainably rely on migrant labour’ – an independent review will shortly be commissioned to look at labour shortages in the food supply chain.

Healthier Food System

It is probably in this area that Mr Dimbleby will be the most disappointed.   He devoted a large amount of his independent report to the causes of poor diet, the effects on individuals and society, and what should be done about it.  The Government has largely avoided any hard (i.e. potentially unpopular) decisions.  Some of the key measures include;

• over the next three years there will be a series of randomised control trials of interventions in the food system to encourage and enable healthier and more sustainable diets for all.  This programme aims to build a suite of evidence-based and value for money interventions that can be developed into full scale policy
• schools will be targeted to both provide healthier meals and also teach children about better food choices
• a Food Data Transparency Partnership will be set up to help people make informed choices about their food.  This will firstly involve the development metrics to objectively measure the health, environmental sustainability, and animal welfare impacts of food.  Food companies will then have to report against these
• public procurement of food will be amended with an aspiration that 50% of ‘Government’ food expenditure is on food produced locally or to higher environmental production standards

Food Trade

The Government states that open markets are the best way to mitigate food shortages on a global scale.

The Strategy aims to maximise the export opportunities for the food and drink sector now that the UK is free to negotiate its own trade policy.  Ten agri-food attachés will be appointed across the world to support UK food and drink exporters.

The Strategy restates the Government’s commitment to protecting the environment, animal welfare and food standards in any Free Trade Agreements.  It will shortly be publishing a statement on an animal health and production regime – this will set out the requirements for those wishing to access the UK market.

The full Strategy can be found at – https://www.gov.uk/government/publications/government-food-strategy/government-food-strategy