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Jeremy's Blog 30th July 2020: Agricultural Policy in England

Jeremy's Blog 30th July 2020

The New Agricultural Policy in England is Coming

This article by Jeremy Moody first appeared in the CAAV e-Briefing of 30/7/20

The reality of the new English agricultural policy, outside the EU, is imminent. Ministers are adamant that the first cut in Basic Payment will start the transition period in 2021, seeing new policies phased in. With more detail promised in an autumn statement, that seven year process was again outlined in the Government’s replies to the House of Lords Committee stage on the Agriculture Bill. That reality, with much other prospective change, underlay the CAAV’s successful Business Review event on Monday.

DEFRA Minister, Lord Gardiner, set out the basic argument:

“While direct payments currently form an important contribution to income on many farms in England, we believe that they can hamper productivity growth in the agricultural sector. That is why, within the sum that will be released, that money will be diverted into countryside stewardship and productivity grants so that farmers can start, through their business interests, to take advantage of the money that will move from direct payments into these other areas of support.” (House of Lords, 21st July, Cols 2083-84)

From 2021 productivity grants will aid equipment or infrastructure, adding value to existing products, creating new products or making products available directly to customers. ELM and other schemes follow later.

Basic Payment is itself to change. All greening, with crop diversification and EFAs, is now dropped for English 2021 applications with the money added to the Basic Payment. Created as an environmental justification for the Basic Payment, essentially bearing on arable farmers, EU auditors reported in 2017 that “As currently implemented, it is unlikely to enhance the CAP’s environmental and climate performance significantly”, or justify the significant complexity added to the CAP. England’s environmental emphasis is on Countryside Stewardship and the prospective ELM policy.

Basic Payment is time-limited for England. Lord Gardiner told the Lords that:

“When delinked payments are introduced, they will replace the current basic payment scheme entirely and for all farmers. The basic payment scheme and delinked payments cannot and will not coexist. … we may wish to move away from the current approach of making a single payment per year and issue payments more frequently instead” (21st July, Cols 2085-86)

Elsewhere, elections will see legislation for Wales after 2021 and for Northern Ireland after 2022. Scotland, seeking to stay close to EU policies, may now consider whether it too will drop crop diversification.

With these changes now moving, businesses need to prepare.

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