Category: Policy & Business

Future Welsh Farm Support

There will be no change in Welsh support schemes until after 2023.  This was announced by Rural Affairs Minister, Lesley Griffiths in the Welsh Government’s Policy Response to the Consultation on the Agriculture White Paper which closed in March this year (see December 2020 Bulletin for details).

The announcement on the continuation of current schemes includes;

  • the Basic Payment Scheme will continue until 2023 (with the caveat from the Welsh Government that sufficient funding needs to be provided by the UK Government in the upcoming Spending Review).  Although not completely clear, we take this to mean that the usual BPS claim will be made in May 2023 with a payment in autumn/winter 2023.
  • existing Glastir Advanced, Commons and Organic contracts will be extended until December 2023.  All existing eligible contract holders will be offered an extension via their RPW on-line accounts.
  • the Farming Connect Programme will be extended to March 2023 with £7m of funding)

The Minister also set out a timetable for how new policy arrangements are to be taken forward over the next few years;

  • first half of 2022: the draft Agriculture Bill will be published.  This will give the Government powers to enact a new farm policy.  The legislation will also make changes to the Agricultural Holdings Act 1986 and set the legal framework for new National Minimum Standards which will replace cross-compliance.
  • first half of 2022: alongside the Agriculture Bill a draft outline of the Sustainable Farming Scheme (SFS) will be published.  This will set out details of the structure of the scheme and the actions that farmers might be expected to take.
  • summer 2022: a further round of ‘co-design’ on the SFS will commence, to refine the scheme
  • 2022: a range of ‘interventions’ are promised to help farmers prepare for the SFS.  There are no details of what these might encompass.  Also, a new scheme will be launched to fund woodland creation.  This will eventually form part of the SFS.
  • spring 2023:  the final version of the SFS should be published along with a consultation.  This will contain details of the proposed transition from the BPS (i.e. phasing).  The Policy document specifically states there will be a ‘multi-year’ transition from the BPS to the SFS.
  • 2024: there will be an outreach programme to prepare farmers for the launch of the SFS.  This will include commencing farm Sustainability Reviews.
  • 2025: the SFS will open in January 2025.  This does rather beg the question of what happens in 2024 – the BPS will continue in its present form including the 2023 year, but there then appears to be a gap where the BPS is not guaranteed but the SFS hasn’t started.  The BPS may well continue in much the same way for 2024 but the Welsh Government may not want to have committed to this as the funding cannot be guaranteed this far in advance.  Alternatively, the first BPS deductions might start in 2024 to generate a fund of money to be spent on the SFS – much as the English BPS is currently being phased-out without ELMs yet being in place.

Further detail on the announcement can be found at – https://gov.wales/written-statement-agriculture-wales-white-paper-summary-responses-and-welsh-government-policy

 

Defra Ministers

The Government reshuffle undertaken on the 15th and 16th September has left Defra Ministers largely unchanged.  George Eustice remains as Secretary of State.  There is a promotion in the junior ranks with Victoria Prentis being upgraded from ‘Parliamentary Under Secretary’  to ‘Minister of State’.  Defra gets one more junior Minister with Jo Churchill being brought in as an Under Secretary.  Ms Churchill is the MP for Bury St Edmonds and was previously a Minister in the Department of Health.

Facilitation Fund

Defra is giving a ‘heads-up’ that the Countryside Stewardship Facilitation Fund will open for a 6th round in December 2021.  The fund supports facilitators, either individuals or organisations, to bring farmers and foresters together to produce landscape-scale Countryside Stewardship agreements.  A total of £2.5m will be available under the latest round, which will close to applications on 19th January.  Further details will be made available soon.

 

 

UK Border Operating Model: Delayed Again

The UK Government has, once again, delayed the implementation of border controls on agri-food imports from the EU.  The postponement is blamed on the combined effects of the Covid-19 pandemic and food supply-chain issues, but it is equally a result of the Hard Brexit the Government negotiated.  This move was becoming increasingly inevitable in recent weeks as it is clear that the infrastructure required to deliver effective border controls for imports from the EU was not ready and businesses were becoming increasingly concerned about the lack of preparation time.  The key aspects of the revised timetable are;

  • Pre-notification of Sanitary and Phytosanitary (SPS) goods: requirements which were due to be introduced on 1st October 2021, will now be introduced on 1st January 2022.
  • Export Health Certificates: these requirements, which were due to be introduced on 1st October 2021, will now be introduced on 1st July 2022.
  • Phytosanitary Certificates and physical checks on SPS goods at Border Control Posts: were due to be introduced on 1st January 2022, but will now be introduced on 1st July 2022.
  • Safety and Security declarations on imports: will now be required as of 1st July 2022 as opposed to 1st January 2022.
  • Full customs declarations and controls: will be introduced on 1st January 2022 as previously announced.

Remember that this only applies to imports from the EU – exports from the UK to Europe have been subject to the full range of EU checks since the start of this year.  More checks and bureaucracy on imports would raise costs and could reduce the competitiveness of EU goods on our market.  For this reason the delays outlined above might not be welcomed by the farming sector.  Particularly as the rules are currently ‘lopsided’ with imports exempt from many checks, but our exports being fully subject to EU rules.    

The delay will be seen as a welcome move by most businesses in the wider food chain.  But the UK Border Operating Model has already been delayed before and there is still a lot of work to be done before the revised timetable can be achieved.  Of course, a comprehensive veterinary agreement with the EU would help greatly on multiple levels.  For example, it would reduce the requirements for physical checks quite considerably (for instance, the New Zealand veterinary agreement with the EU reduces physical checks for red meat from the default of 15% down to 1%).

A veterinary agreement would also help to make the implementation of the NI Protocol more sustainable, as it is the levels of regulatory checks at NI ports which are seen by some communities as being the most invasive.  Reducing these towards the levels currently in place for live animals (which were subject to physical checks even before Brexit) would help the implementation of the Protocol.  Coincidentally, the delays to the UK Border Operating Model will also mean delays to the announcement of rules covering NI-GB ‘qualifying goods’ (i.e. NI-produced goods which would qualify for unfettered access to the GB market). 

Thirdly, it would also help UK-GB exports to the EU.  In addition to the revenue lost on trade with the EU, this has also had a significant indirect impact on the food supply-chain shortages that the UK is currently witnessing.  Previously, haulage companies carrying imports into the UK would use ‘backloads’ of goods being exported from the UK to the EU to contribute to the overall cost of travelling to and from the UK.  With such shipments being significantly reduced, in addition to the pandemic impacts which have made drivers more reluctant to travel to the UK, the HGV driver shortage has been exacerbated. 

There were calls for a 2-3 year ‘Implementation Period’ after the UK formally left the EU; the latest delays to the UK Government’s Border Operating Model are creating this by default.  Whilst the latest move from the UK Government will help somewhat to address the current supply-chain situation, this additional time needs to be used wisely.  In its press release announcing the new timetable (see link below), the Government calls its approach ‘pragmatic’.  If it seeks to be truly pragmatic then implementing a veterinary agreement with the EU combined with addressing the agri-food industry’s labour issues would go some way to addressing the problems generated by Brexit.   

Further information on the UK Government announcement is accessible via: https://www.gov.uk/government/news/government-sets-out-pragmatic-new-timetable-for-introducing-border-controls

Sustainable Agricultural Capital Grant Scheme

Applicants to the Sustainable Agricultural Capital Grant Scheme in Scotland now have until 31st December 2021 to submit their claim.  This is the second time the deadline has been extended.  The original date was put back from 31st March until 30th September and now the Scottish Governement has announced claimants have until the end of the year to make a claim.  It appears there are issues over the supplies of certain items.  Completed claims and supporting documents should be emailed to a claimant’s local office.

NI Farm Policy

Northern Ireland’s Agriculture Minister, Edwin Poots, has published a framework for future agricultural policy in the province.  The Future Agricultural Policy Framework Portfolio takes into account the views from a consultation undertaken in 2018.  That exercise focused on a vision for future agriculture in Northern Ireland based around four ‘desired’ outcomes; increased productivity, improved resilience, environmental sustainability and a responsive supply chain.  The Portfolio assesses the views on these key outcomes and sets out a framework on how they can be delivered:

  • A simple, area based (resilience) measure – this will be set at a level to provide a ‘safety-net’ so that it does not ‘blunt’ innovation or productivity.  There will be minimum and maximum thresholds with recipients having to adhere to certain standards of farming activity and behaviour; similar to cross-compliance but targeted more towards NI’s issues.
  • A headage sustainable measure – this will be for suckler cow and breeding ewe producers to support the ‘economic and environmental performance’ of these sectors.  The formation of a genetics and livestock data programme will also be explored.
  • An Agri-environment package – will form a major part of future policy, but it is unlikely to be just one all-encompassing scheme as this is not seen as being able to deliver the multiple environmental issues that need addressing in NI.  The package is expected to ‘evolve and expand’.
  • An investment measure – will be aimed at investments which drive innovation, productivity and result in better environmental outcomes, including reducing carbon, ammonia and nitrate emissions.
  • Knowledge measures –  forming an important part of the policy portfolio, Continuous Professional Development (CPD) is seen as key to being able to deliver the objectives.  Following the success of the Business Development Group a knowledge measure will form a component in as many policy initiatives as possible.
  • Generational Renewal – the view is that, by accelerating the transition down the generations, these will be better trained, more open to innovation and change and will help drive the desired policy outcomes.  But it is acknowledged that it will take more than just simple financial incentives and more work in developing this idea is being undertaken.
  • Supply chain measures – it is acknowledged that this is an area where greater engagement locally is required.  The Independent Strategic Review of the Agri-Food Policy being led by Sir Peter Kendall is expected to feed into this area.

The ‘workstreams’ above are seen as the seven key components of the future support framework.  However there are other ‘cross-cutting’ elements that are seen as being required to fulfil the objectives, these are;

  • Soil testing and LiDAR
  • Livestock genetics and data initiatives
  • Carbon reduction
  • Controls and assurance
  • Metrics, monitoring and evaluation
  • Environmental assessments

There will also be a horticultural workstream.  Work is currently progressing on all 14 separate but related workstreams developing future policy proposals.  The Framework aims to form the basis for ongoing discussions with the industry and stakeholders as policy proposals are developed.  There will be a full consultation on these this autumn.  The development of farm policy in Northern Ireland has been delayed due to the suspension of the NI Government and the Framework gives little indication of when a new policy will be introduced – only to say the move from CAP based schemes will need to happen over ‘a number of years’ in order to deliver a ‘managed’ transition.  The full Framework Portfolio can be found at https://www.daera-ni.gov.uk/sites/default/files/publications/daera/21.22.086%20Future%20Agriculture%20Framework%20final%20V2.PDF 

 

Environment Bill

The Government has made new amendments to its landmark Environment Bill.  Following work with Parliamentarians and wider stakeholders a number of amendments have been tabled including the duty to set a legally-binding target to halt species decline by 2030.  Other measures will tackle storm overflows through a new requirement for water companies to monitor the water quality impacts of their sewage discharges and publish this information.  The full amendments can be found at https://bills.parliament.uk/bills/2593/stages/15657/amendments?searchTerm=&Decision=All&MemberId=4062

 

 

Future Scottish Farm Policy

The Scottish Government has launched an initial consultation on future agricultural policy.  Called Agricultural Transition in Scotland – First Steps Towards our National Policy it follows on from the work carried out by the Farmer Led Groups (FLG).  These were set up in 2020, covering all the agricultural sectors in Scotland to recommend ways in which farmers and crofters could consider the effects of landuse change and cut their emissions to help tackle climate change (see our article https://abcbooks.co.uk/sustainable-future-for-farming-scotland/).  Reducing greenhouse gas emissions was core to the work of the FLGs but improving biodiversity and agricultural productivity were also seen as important.

Although billed as as a consultation on future agricultural policy, its not perhaps quite what the industry was looking for.  It does not give clear proposals for new schemes or timings – it is more about generic policy direction.   The consultation provides an overview of the key themes and recommendations emerging from the FLG reports.  It also asks a number of questions arising from the recommendations from the FLGs to inform wider work on the development of Scotland’s national agricultural policy, including:

  • Baselining – should support be received for businesses to undertake a level of baseline data collection; should this be a national collection; what information should be collected?
  • Capital Funding – should this only be limited to providing support for capital items that have a clear link to reducing greenhouse emissions?
  • Biodiversity – should all farming and crofting businesses be incentivised to undertake actions which enhance biodiversity?
  • Just Transition – what are the main opportunities and barriers for farmers in a ‘Just Transition’ to a net zero economy?
  • Sequestration – how best can land use change be encouraged on the scale required for the Scottish Government to meet its climate change targets?
  • Productivity – would incentives for farm plans targeting flock/herd, soil and crop health demonstrate productivity over time and should future support be dependent on demonstration of improvements in productivity?
  • R & D – are additional measures required above the 2022-2027 research strategy
  • Knowledge & Skills – should Continuing Professional Development (CPD) be mandatory for businesses receiving public support?
  • Supply Chains – should farm assurance be linked to requirements for future support and how can the green credentials of Scottish produce be further developed?

The consultation closes on 17th November 2021 and there is expected to be a series of workshops to help further identify the key issues and stimulate ideas during the consultation period.

In addition to the consultation, almost inevitably, the Scottish Government has also set up a new committee.  The ‘Agriculture Reform Implementation Oversight Board’ (ARIOB), co-chaired by the Cabinet Secretary and NFUS President Martin Kennedy is tasked with driving forward the recommendations from the FLGs and developing new proposals for sustainable farming support.  This will also include consulting on proposals for a sustainable suckler beef scheme.

This initial consultation is expected to be followed by a full consultation in 2022 on proposals for future farm policy, with an Agriculture Bill setting legislation in 2023.  This is likely to have more of a ‘framework’ covering the transition from CAP based schemes to domestic policy.  The full consultation can be found at https://www.gov.scot/publications/agricultural-transition-scotland-first-steps-towards-national-policy-consultation-paper/documents/ More information on the ARIOB, including members can be found at https://www.gov.scot/news/delivering-a-new-future-for-rural-scotland/.

BPS 2021 Payments

Farmers in Scotland could receive 95% of their 2021 BPS payment as early as September.  Once again, Scotland has announced it will be running a National Basic Payment Support Scheme.  This will mean loan offers will be made, calculated at 95% of a claimant’s anticipated BPS payment including the Greening amount, capped at a maximum of £133,638 (€150,000).  Letters will be sent out in batches, with the first set arriving from mid-August.  Similar to the scheme in 2020, those wishing to make use of the scheme will need to opt in.  Balance payments will be made from December 2021 when the payment window opens.

In Wales, the aim is to make a BPS advance payment of 70% of the estimated claim value from 15th October 2021.  Payment will be made automatically subject to submission of an eligible BPS claim and the necessary supporting documents.  Balancing payments will be made from 15th December subject to completion of the full validation of the claim.

In England there has been no announcement regarding ‘early’ payment.  As in previous years payments are expected to commence on 1st December.

SFI Pilot

The deadline for applications to the SFI Pilot has been extended until 30th September 2021 (originally 1st September).  The Pilot is for those who expressed an interest in the scheme earlier in the year.  Furthermore, Defra continues to make amendments to the online guidance for the SFI Pilot.  There seems to be a lot of guidance, we think the best place to start and ‘navigate’ from is https://www.gov.uk/government/collections/sustainable-farming-incentive-pilot-guidance.