The National Audit Office (NAO) has warned that the Government’s planned shift away from the EU’s system of land-based support payments, towards a scheme which rewards farmers for environmental work and other “public goods”, could have “unintended consequences” if not handled correctly.
The NAO warns that 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.
According to the report, 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 the Department for the Environment, Food and Rural Affairs, (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.
Meanwhile the direct subsidy payments, which approximately two-fifths of producers rely on, are being phased out over a seven-year period starting in 2021.
Plans for the first year of the pilot have been scaled back and the Government now aims to sign up 1,250 farmers instead of 5,000, but it is still expected that 15,000 will be trialling the system by 2024. However, that only leaves two years to assess the scheme at scale.
A spokesman for the National Farmers’ Union (NFU), said it worries about the transition timetable, as a planned trial scheme in the Norfolk Broads has already been delayed.
Martin Johnson, Manager at Milsted Langdon, said: “The end of the Basic Payment Scheme is a significant change for the agricultural sector. The warning by the NAO reflects the importance of the need to get this correct for farmers in England.
“For advice on this or any other matters relating to agriculture, contact us today.”