I am writing to let you know that this week we have published a consultation on changes to the Basic Payment Scheme subsidies to Farmers in England. These changes will support farmers through the agricultural transition period from now until 2027.
The proposals within the consultation seek to offer a fairer system for farmers, providing more flexibility by opening up opportunities for new entrants to start up their farm businesses and supporting those who are ready to do so to leave the sector on their own terms.
The consultation will be open for 12 weeks and focuses on two key areas:
• Lump sum exit scheme – Building on evidence that some farmers would like to retire or leave the industry but have found it difficult to do so for financial reasons, we propose to offer them a lump sum payment to help them do this in a planned and managed way. This should free up land for new entrants and those farmers wishing to expand to boost their profitability. The consultation seeks views on who should be eligible for these lump sum payments and how the payments should be calculated.
• Delinked payments - Direct Payments currently made through the scheme offer poor value for money and are based on how much land a farmer has, which inflates rent and can stand in the way of new entrants. We plan to phase Direct Payments out over a gradual seven-year transition period. The consultation includes plans to separate the payment from the amount of land farmed, from 2024. This will simplify the process for farmers, allow them to focus on running their business and encourage them to take up the new environmental land management schemes, which will reward sustainable food production and environmental improvements. The consultation seeks views on how the ‘delinked’ payments will be calculated.
A vibrant farming industry also needs to attract new talent and create more opportunities for new entrants and farmers wishing to expand their businesses. We are working together with industry leaders, local councils, landowners and new entrants to co-design a scheme to create real opportunities for new farming businesses.
The proposals set out today also build on previous steps that have been taken to simplify the subsidies, including simplifying penalties for small overclaims of land from the 2020 scheme year, the removal of the ineffective “greening” requirements, and improving the arrangements for farmers with land in more than one part of the UK, from the 2021 scheme year.
The new scheme will be available to support new entrants from 2022. Recommendations for the design of the scheme will be shared later in the year.
This is a once in a generation chance to design our new farming system and we want to do that together with farmers to make sure that it works for them.
RT HON GEORGE EUSTICE MP