Jeremy's Blog 4th December 2020: Change for Agricultural and Land Management
This article by Jeremy Moody first appeared in the CAAV e-Briefing of 3rd December 2020
The drumbeat of change for agriculture and land management is now fast and loud. The message of prospective change is becoming real economic and practical change for farmers and their advisers, moving in a short period of days from speculation to a part of work.
Policy making and scrutiny are now in the UK. While the negotiations with the EU remain unresolved and the Northern Ireland Protocol a mess, the EU Transition Period ends in four weeks. The Agriculture Act now gives DEFRA powers for new policies. The Spending Review confirms the available money. The Act gives initial powers to Wales and Northern Ireland before they set their policies. Scotland has legislated for its initial management of legacy schemes.
The Agricultural Transition Plan setting out policies for England, in principle to 2027 and in more detail to 2024, has been launched, hard on the heels of the Act. The Welsh White Paper will soon confirm its future policies. DEFRA and Wales are re-visiting animal export rules.
Parliament is re-writing EU legislation for England including the main Basic Payment Regulation, that tortured product of 28-way Brussels negotiations plus the European Parliament. Greening has gone in England and Northern Ireland and is reduced in Wales and Scotland. The Chancellor is to re-write EU law limiting insurance companies opening funds for infrastructure.
England’s Agricultural Transition Plan has the twin priorities of a competitive agriculture and acting on the environment, climate change and animal welfare. With the first Basic Payment cuts in 2021 and larger claimants losing more, it will drop from 68% of funding to 34% in 2024. “Public goods” spending rises from 23% of the pot to 57%. The balance is for new productivity schemes. Those figures make this change concrete.
ELM’s introduction, with new labels and more development to come, starts with the Sustainable Farming Incentive from 2022 following the first Pilot in 2021. DEFRA, inheriting the compensation basis of income foregone/costs incurred, is looking at how it will price ELM to be fair and attractive while protecting public money.
The new world is now becoming very real. Farmers can now see where their Basic Payment will be in 2024. Especially for combineable crops and grazing that is a significant cut, motivating business change across large areas of the country. Reckoning with that transition now will be much assisted by the work of members as trusted advisers, drawing on both established skills and the CAAV’s Future Skills focus on business review and environmental resources. With the core question of where the client wants to be in 10 years time, good advice will be needed as an investment for the future.