Category: Policy & Business

Expanded SFI Offer for 2024

Expanded Offer

Defra has released details of the expanded SFI 2024 offer.  In total there will be 102 actions available.  This will include the 23 existing actions (available now under SFI 2023), over 20 brand new actions and more than 50 actions which were previously available under Countryside Stewardship Mid Tier (CS MT).  With reference to the latter, a number of these actions have been simplified and reduced from 5 to 3 years, so that over 90 of the actions are for 3 years.  This has the aim of making the scheme more accessible to tenant farmers.  Our article of 8th January gave details of some of the new actions, which include support for precision farming, agroforestry, boundaries and an improved offer for upland farmers (see https://abcbooks.co.uk/elm-2024/).

All the actions will be merged into one scheme – called the Sustainable Farming Incentive (SFI) and they will be available via one application.  Defra has said ‘bringing the schemes into one place, with one name, means farmers can access the best of both offers, the flexibility of the SFI with the breadth, scale and ambition of CS MT, just with less paperwork’.  It is our understanding that going forward there will no longer be a CS Mid Tier; this has now been subsumed into the SFI.  We were expecting this to happen over time, but it has occured quicker than we thought.  CS Higher Tier will remain available – see below.  

Controlled Rollout

The expanded SFI will be offered via a ‘controlled rollout’.  Initially, the RPA will invite a mix of farm businesses who have submitted an Expression of Interest (EoI) in the expanded offer.  EoIs have now opened and can be made via https://defragroup.eu.qualtrics.com/jfe/form/SV_cSGsCBrA5Kim3H0  Invites from the RPA will start from the end of May.  This is to test the system before full rollout.  Applications will then open to the wider sector ‘based on eligibility’ (it’s not clear what that actually means) from 22nd July 2024.  We do however know, the expanded offer will be available to those who have not previously claimed the BPS for the first time.

The SFI cap, which was put in place in March 2024, will remain with a further four actions from the new expanded offering being added.  This means new SFI applications will only be able to put 25% of the total agricultural area of their farm into a combination of one or more of these 10 actions which include:

The original actions:

  • IGL1 – Take improved grassland field corners or blocks out of management
  • IGL2 – Winter bird food on improved grassland –
  • AHL1 – Pollen and nectar flower mix
  • AHL2 – Winter bird food on arable and horticultural land
  • AHL3 – Grassy field corners and blocks
  • IPM2 – Flower-rich grass margins, blocks, or in-field strips.

New actions similar in nature to the 6 above:

  • WBD3 – in-field grass strips
  • AHW9 – unharvested cereal headland
  • AHW1 – bumblebird mix
  • AHW11 – cultivated areas for arable plants

Full details on the expanded offer can be found via https://www.gov.uk/government/publications/sustainable-farming-incentive-scheme-expanded-offer-for-2024

Guidance on all the individual actions can be found on the new digital tool known as ‘find funding for land or farms’ https://www.gov.uk/find-funding-for-land-or-farms.  This is similar to the Countryside Stewardship Grants finder.  Whilst it was very nice to have a SFI ‘Handbook’ with all the actions in when there was only 23, this may not be practical now we have 102 actions.  One has not been published as yet.

Defra has also produced guidance leaflets under the following themes:

Countryside Stewardship Higher Tier

More information will be available later in the summer for those interested in the CS Higher Tier, this will include:

  • eligibility
  • how to apply and request specialist advice
  • details on each Higher Tier action

Higher Tier is being kept separate as these agreements are usually more complicated and require specialist advice from Natural England (NE) or the Forestry Commission (FC).  Later this summer applicants will be able to start working with NE or the FC to draw up their applications, with eligible farmers being able to submit applications online via Rural Payments during the ‘winter’ with the first agreements commencing in early 2023.  After this, applications will be possible all year round with agreements normally starting the month after applications are approved.

SFI 2023

The existing SFI 2023 scheme remains open, but it seems there will be a ‘downtime’.  Defra has said ‘you can apply for the SFI 2023 offer until access to the application service is restricted, before the expanded SFI offer is launched in summer 2024’.  As all the actions that are in the 2023 offer will be carried forward into the 2024 offer, this will only really affect those that are in the middle of drawing up an agreement, we do however expect to be given warning before this happens, so this is just a ‘head’s-up’.

N.I. Access to UK TRQs

Northern Ireland food businesses will have easier access to imported products as a result of a new agreement.  The UK Government and the EU Commission have ratified an agreement to permit Northern Irish businesses to access tariff rate quotas (TRQs) that the UK agrees with non-EU countries. The agreement means that over 13,000 tons of lamb, beef, and poultry including from key importers such as Australia and New Zealand will now be available.  The UK Government claims that this will significantly benefit Northern Ireland businesses, and further cements Northern Ireland’s integral place in the UK.

The new arrangements will operate alongside the UK Internal Market system from 30th September 2024.  It addresses a problem with the old NI Protocol, where NI businesses exporting their goods could benefit from UK Free Trade Agreements but those importing high-tariff products like meat into Northern Ireland could not benefit from UK deals.  This agreement will signify more competition for NI farmers, although the UK Government claims that this will be limited.  It is also claimed that the deal will help NI food processors to adopt a more flexible approach, particularly when local production (e.g. sheepmeat) is out of season.

Carbon Benchmarking

The AHDB is to undertake research into the true carbon footprint of farming.  This will calculate net emissions from farming (including sequestration) rather than just gross emissions.  It also aims to more accurately measure and record emissions.  The AHDB (alongside its partner, QMS) is looking to recriut 170 farms for the 5-year study.  More details can be found at – https://ahdb.org.uk/baselining

Food Security

Defra has published new data on the UK’s food security.  This shows that the UK has a high degree of food security which, in the short-term, has remained broadly stable as the UK has come out of a challenging period of global supply chain shocks.  However, there is a longer-term risk from climate change.

Under the Agriculture Act 2020, the UK Government has to present a report on food security to Parliament at least once every three years.  This is known as the United Kingdom Food Security Report (UKFSR) and the first one was produced in 2021 (see https://www.gov.uk/government/collections/united-kingdom-food-security-report ).  A revised UKFSR is promised ‘towards the end of the year’.

The Prime Minister announced in January that a Food Security Index for the UK would be produced annually to fill the gaps between the three-yearly reports.  The first of these has now been published.  It is not as detailed as the UKFSR, but provides a ‘snapshot’ of key trends.

It is based on nine Indicators which are measured using existing statistics published annually.  The Indicator is then ranked on a 5-point scale, depending whether risks have increased, decreased or stayed broadly the same.  The Indicators and results for 2024 are;

1: Global food supply for human consumption: Broadly stable
2: Share of global cereals and soyabeans internationally traded: Broadly stable
3: Production-supply ratio (this is UK self-sufficiency in food):  Broadly stable
4: Agricultural total factor productivity: Some reduction in risks
5: Agricultural land use: Broadly stable
6: Energy and fertiliser prices: Some reduction in risks
7: Business investment: Broadly stable
8: Biosecurity risk: Broadly stable
9: Consumer confidence in food supply chain actors: Broadly stable

Full details can be seen at https://www.gov.uk/government/publications/uk-food-security-index-2024

Farming Summit

The second ‘farm-to-fork’ summit took place in Downing Street on the 14th May.  This saw a number of policy annoucements made to coincide with the meeting.

A summary of the main initiatives is set out below.  More details on a number of these are provided in seperate articles;

  • a long-term guarantee on numbers under the Seasonal Workers Scheme (see additional article)
  • a ‘Blueprint for Growing the UK Fruit and Vegetable Sector‘ (see additional article in Arable section).  This includes a replacement for the old EU ‘Producer Organisation’ Fruit and Vegetable Aid Scheme, with increased funding
  • the publication of the first Food Security Index for the UK (see additional article)
  • a fund of £3m  to support new and mobile small abattoirs – building on the previous Small Abattoir Fund
  • assistance to help agriculture cope with the recent wet weather.  This includes relaxing the rules for agri-environment schemes (see separate article).  There is also new funding of £75 for Internal Drainage Boards to help them repair damage to drainage infrastructure from the winter storms and invest in new measures to boost resilience
  • the £15m fund for Food Waste, announced by the Prime Minister at the NFU Conference in January, will open on the 31st May (no details on how this will operate are available yet)
  • An Infrastructure Grant for Housing Laying Hens with a budget of £20m is to be made under the Farming Improvement Fund (see seperate article in Livestock section)
  • the Government will consult on introducing Permitted Development Rights under the Planning Regime for a small-scale single on-farm wind turbine
  • a new Endemic Disease Scheme, worth £72m, will tackle BVD in cattle, PRRS in pigs and a number of different conditions in sheep
  • there will be £15m to fund innovative research into solutions for nutrient management (see seperate article)
  • work on fairness in the food supply chain will continue.  Following regulation of the dairy supply chain (https://abcbooks.co.uk/dairy-contracts-legislation/), similar rules will be brought forward for the egg and fresh produce sectors.  The pig sector is likely to follow in time.  A mandatory system for sheep carcass classification wil also be introduced
  • a Commissioner for the Tenant Farming Sector (CTFS) will be appointed in the autumn.  This was one of the recemmendations of the Rock Review into farm tenancies in England.  The Commissioner will ensure the Tenancy Code of Practice (https://abcbooks.co.uk/tenancy-code-of-practice/) is being adhered to

More details on the announcements can be found at – https://www.gov.uk/government/news/government-unveils-major-package-of-farming-and-food-sector-support

Nutrient Management Research Grants

Defra has announced funding for projects which will develop innovative solutions to farm nutrient management.  Through the Farming Innovation Programme, £15m will be available through two competition strands;

  • Farming Futures: Nutrient Management Phase 1 – Feasibility – Funding for projects of between £200,000 to £500,000
  • Farming Futures: Nutrient Management Phase 1 – Industrial Research – funding for projects of between £500,000 to £1,000,000

The Farming Innovation Programme, is a partnership with Innovate UK who are part of UK Research and Innovation (UKRI) – the UK’s innovation agency.  Innovate UK deliver the programme, providing funding to those who want to research or develop an innovative solution to a known problem in agriculture.  Funding is grouped under four different themes; this support is via the Farming Futures Research and Development (R & D) Fund which supports work on ‘longer-term’ innovations.  Both competitions will open on 29th May and close at 11am on 24th July, but further guidance has been made available in advance of opening and can be found via https://farminginnovation.ukri.org/

Further to these strands, Innovate UK will run an additional competition, Farming Futures: Nutrient Management Phase 2 – Industrial Research, in Autumn 2024.  This Phase 2 competition will have higher project costs than can be supported through the Phase 1 competition.

 

Wet Weather Adjustments to Schemes

Defra has announced some temporary adjustments to agri-environmental agreements due to the wet weather.  This means that if the bad weather has caused disruptions to farming activities so that agreement requirements cannot be met, Defra is allowing more time to establish some options.  Or it may be possible to defer some activities until later in the year.

The ‘temporary easements and adjustments’ are available for agreements under the SFI, SFI Pilot, Countryside Stewardship (CS) and Environmental Stewardship (ES) and covers the period from 1st October 2023 to 31st July 2024 for agreements that are live now.  The full list of adjustments, including the option/action, current requirement and the temporary adjustment is available at https://www.gov.uk/guidance/wet-weather-temporary-support-for-farmers-in-2024#annex.  The adjustments will apply automatically meaning farmers do not need to submit a request.  However, where farmers do not believe they can meet the aims of the option/action within the temporary adjustment provision or the action/option is not on the list, the RPA will need to be contacted and a Minor and Temporary Adjustment form will need to be completed for CS and ES.  For SFI, the Query Form will need to be used.

It is also advisable to keep evidence, such as farm records showing field operations at land parcel level, associated invoices and photographs in case these are requested.

SFS Delayed: Wales

The commencement of the Sustainable Farming Scheme (SFS) in Wales has been delayed by one year.  In a Written Statement, Huw Irranca-Davies, the new Cabinet Secretary for Climate Change and Rural Affairs, has announced the SFS Transition Period will now commence from 2026.  Instead, during 2025 there will now be a Sustainable Farming Scheme Preparatory Phase of Activity.  During this phase the intention is for the BPS to be available and an announcement on the BPS ceiling for 2025 will be available ‘in due course’.

The Cabinet Secretary has also announced the ‘new timeframe’ will also allow for a number of other pieces of work to take place including;

  • Discussions with Plaid Cymru and the Ministerial Roundtable to quickly identify areas of agreement to allow time for areas where more work is required
  • Using the Roundtable to find an appropriate payment methodology for the new scheme – recognising the wider benefits farming provides, going beyond income forgone and costs incurred, to recognise social value
  • Undertaking a data confirmation exercise – feedback from farmers will be used to provide an accurate picture of the habitat and tree cover across all farms – the 10% tree cover requirement has been one of the most controversial parts of the SFS to date
  • Working with stakeholders to identify and develop a set of proposals for further Optional and Collaborative Actions with the intention of introducing these as soon as possible.

In terms of direct support for Welsh farmers in 2025 it appears that many of the current schemes will continue.  In addition to the BPS, the Welsh Government has said it expects the Small Grants Scheme to be available.  Furthermore, the Habitat Scheme Wales, which was opened last year as an ‘interim scheme’ between Glastir and the new SFS has been seen as a success and the Cabinet Secretary has said he is ‘exploring giving more farmers the opportunity to access support in 2025’.   In addition, he has announced they are working on a ‘new landscape scale’ scheme which will build on the experience of previous collaboration schemes.

Farming Connect looks set to continue with an emphasis on promoting the ‘benefits and opportunities’ of tree cover and woodland on farms and also continuing support for knowledge transfer.  Similar to this year support for organic farmers is also being considered.

The Written Statement comes amid continued protests from Welsh farmers over the introduction of the new SFS scheme; it remains to be seen if their concerns can be addressed over the coming months.  The full Written Statement can be found at https://www.gov.wales/written-statement-future-farming-wales.

 

Sheep Payments: Scotland

The Scottish Government has announced sheep headage payments are starting to be made to eligible farmers.  As of 10th May, 97% of eligible applications to the Scottish Upland Sheep Support Scheme (SUSS) 2023 had been processed and more than 1,000 businesses will receive a share in the region of £6.6 million.  The individual animal payment rate for 2023 is £61.38 per animal.  Under the 2022 scheme the payment rate was £61.25.  The increase in payment rate for 2023 is due to a small decrease in eligible animals claimed.

UK Border Controls

On 30th April, the UK Government introduced its next phase of border controls under its ‘Border Target Operating Model’ (BTOM), which was published in August 2023.  This phase builds upon the customs controls, declarations, pre-notifications and health certifications introduced in January for imports from the EU and focuses on implementing documentary and risk-based identity and physical checks at UK Border Control Posts (BCPs) for goods subject to sanitary and phytosanitary (SPS) checks from the EU, excluding Ireland.

The key changes are;

  • ‘Medium’ risk products: from a biosecurity perspective will now undergo identity and physical checks, which test for pests and diseases that could impact the safety of our food and harm the UK’s natural environment. Checks involve visual inspections and temperature readings of goods.
  • ‘High’ risk products: will now be checked at the border whereas previously these goods were checked at the destination. These checks will be aimed at identifying public health issues such as salmonella, and build on existing safeguarding measures which identify diseases like African Swine Fever, which is now prevalent in certain European countries and poses a significant risk for UK pig farms.

Separately, the UK Government has also published the BTOM risk categorisations and check rates for imports of live animals, products of animal origin (POAO) and animal by-products (ABPs) from the EU, Switzerland, Norway, Iceland, Liechtenstein, the Faroe Islands and Greenland to Great Britain.  The inspection rate (percentage of times a product will be subject to identity and physical checks) depends on the risk category to which it is assigned, and is set out as follows:

  • High risk commodities: will be inspected every time the product is imported (inspection rate 100%).
  • Medium risk commodities: will be inspected at a rate between 1% and 30%.
  • Low risk commodities: will not be subject to routine inspection, but they may be subject to non-routine or intelligence-led checks.

Further information on the inspection rates and associated requirements for the full range of products subject to SPS checks is available via; https://www.gov.uk/government/publications/risk-categories-for-animal-and-animal-product-imports-to-great-britain/target-operating-model-tom-risk-categories-for-animal-and-animal-product-imports-from-the-eu-to-great-britain

Importantly, checks on products entering Northern Ireland will be subject to the provisions of the Windsor Framework, which de-facto, permit Northern Ireland to continue to be part of the EU Single Market and Customs Union as regards agri-food goods.  Accordingly, none of the additional checks or controls set out in the BTOM apply to imports into Northern Ireland from the EU.

For imports coming in from Ireland (i.e. Republic of Ireland), the Border Control Posts in Wales are under construction and are unlikely to be functional until the spring of 2025.  Accordingly, the implementation of physical checks will be delayed until next year with a date to be confirmed.

In terms of the controls that have been introduced on April 30th, there have been some issues with key systems such as IPAFFS – the system used to manage the import of products subject to SPS controls.  There have also been challenges with the extent of coordination between Defra and the HMRC on issues relating to the Automatic Licence Verification System (ALVS) – the system used to match customs and SPS documentation to a given vehicle.  Whether these are just teething problems or will develop into longer-term issues remains to be seen. 

Overall, it is crucial from a biosecurity perspective for the UK to have a fully-functioning border control system and that the gaps in the system following the UK’s departure from the EU are getting addressed.  That said, such controls necessitate the imposition of friction at the border which means additional costs for businesses when importing from the EU.  This will create some inflationary pressure and will likely lead to less choice for some agri-food products, particularly those supplied by small and medium-sized enterprises (SMEs).