The current system of direct payments sees farmers paid largely based on the area of land that they farm. However, the Agriculture Bill looks to replace this with a new environmental land management system which will provide farmers and land managers a source of income for providing environmental benefits, better animal welfare and other public goods.
In terms of the existing Basic Payment Scheme, this is set to remain “on the same basis as now” for 2019/2020 before a seven year transitional period begins during which the Basic Payment Scheme will be phased out. It is thought that this will be a sufficient period for farmers to adapt to the changes, whilst also allowing the new environmental land management schemes to be trialled. The focus of these will be water quality, flood mitigation, soil and air quality, animal welfare and improving access to the countryside. Each of these provisions will be allocated different values, meaning that the topography and location of farmer’s land will be an influencing factor to the payment received.
The proposed schemes will be multi-annual, with shorter schemes offered to tenant farmers and applications will be open year round, as opposed to the specific application windows that we are used to.
Further changes will also include a move away from the need to be actively farming land to claim payment and also the use of direct payments as a “golden handshake”, rolling several years’ payments into one, as a one-off “exit” payment to retire from the industry.
The proposed new framework offers an opportunity for farmers and landowners to receive incentives for undertaking sustainable farming practices. Particularly with the seven year transitional period, there is good time for those affected to plan for the future.