Farmers fear timetable is too tight for ‘radical’ shift in post-Brexit subsidy policy
- Credit: Copyright: Archant 2016
Thousands of farmers could be left seriously out of pocket unless a realistic timetable is set for radical changes to subsidy payments after Brexit.
That was the warning from East Anglian farming leaders after the National Audit Office (NAO) published a review of the government's planned shift away from the EU's system of land-based support payments, towards a scheme which rewards environmental work and other "public goods".
The public spending watchdog warns the move will be a "significant change" for farmers in England, who received 2.4 billion euros in 2017 - mostly via Basic Payment Scheme (BPS) payments linked to the amount of land farmed.
The report warns that farmers will have little time to prepare to take part in the three-year national pilot of the new "environmental land management system" (ELMS) which will pay them for delivering benefits such as habitat for wildlife, flood reduction and carbon storage.
The pilot is due to begin in 2021 but Defra is not planning to set out what environmental outcomes it will pay for or how much farmers will receive for them until April 2020, says the NAO.
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Meanwhile the direct subsidy payments, which around two-fifths of producers are estimated to rely on for their profits, are being phased out over a seven-year period starting in 2021.
Plans for the first year of the pilot have been scaled back from signing up 5,000 farmers to 1,250, but it is still expected that 15,000 will be trialling the system by 2024 - leaving just two years to assess the scheme at scale.
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Rob Wise, East Anglia environment adviser for the National Farmers' Union, said a planned trial scheme in the Norfolk Broads has already been delayed, bringing the overall transition timetable into question - which could have serious financial implications when BPS subsidies are removed.
"We agree with the NAO's findings that it seems an incredibly tight timescale to do everything, even if everything goes according to plan," he said.
"For example, the NFU is working with the Broads Authority for one of the first tests and trials approved by Defra, with a proposal to develop a Broadland grazing option within the new ELMS. It was supposed to start in April, and we were ready to do that, but here we are in June and we are still waiting for Defra and the Treasury to sign off funding for some of the work.
"These tests and trials are, in theory, supposed to inform the pilot plan, to get that framework issued by April next year, to roll it out in 2021. That timetable already looks potentially in jeopardy.
"With the pilot designed to roll out to 1,250 applicants in the first year rather than 5,000, we are looking at a situation where money is being creamed off basic payments and the pool of people able to recoup that money is now predicted to be even smaller than originally planned.
"I won't be surprised if we don't get anywhere near the 15,000, and therefore I would urge Defra to limit any clawing back of basic payments in line with their ability to spend it on this pilot scheme (for ELMS), otherwise farmers who rely heavily on their basic payments are going to be out of pocket and under business stress."
READ MORE: Farmers warn of US trade 'betrayal' as President Trump tours UKNationally, the NFU has called for a smooth transition to the future system of environmental payments, and stressed that any new scheme must be simple, accessible and "have farming at its heart".
Defra estimates that 85,000 farmers will be signed up to ELMS by 2028.
But the NAO said if take-up is low, the government will need to find other ways to secure environmental benefits, while farmers who do not take part could quit the industry or adopt more intensive, damaging agricultural methods.
Gareth Davies, head of the NAO, said: "Defra is moving forward with a policy which is a radical departure from the CAP (Common Agricultural Policy) farm payment regime we have known for 40 years.
"We urge Defra to give itself time and space to fully test and evaluate the policy, and for comprehensive planning, to avoid any unintended consequences for the farming community, our environment or ability to feed ourselves."
Farming minister Robert Goodwill said: "We do not under-estimate the scale of the task in implementing the new ELMS scheme, which is why we are involving such a wide range of stakeholders in its development.
"We will be running a national pilot over three years to test the policy and make sure we get it right, implementing the lessons learnt into the final scheme.
"We will also set out more specific detail on what the ELMS scheme will pay for well in advance of the pilot being rolled out."