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Jeremy's Blog 9th April 2021: Pace of Change

This article by Jeremy Moody first appeared in the CAAV e-Briefing of 8th April 2021.

Despite the late spring, the pace of policy change here is quickening and that will see change on the ground.

We should shortly have DEFRA’s consultation on the lump sum option and delinking of Basic Payment in England. Whether or not the lump sum option for 2022 proves attractive, simply considering it draws attention to how little life is left for English Basic Payment entitlements.

Entitlement payment values will have halved for 2024 when delinking removes the need to have land or be any sort of a farmer. After 2022, entitlements would only be useful in 2023 and then go the way of milk quota, livestock premium rights and potato quota. With claimants’ remaining payments, based on a previous reference period, eroding to nothing by 2028, the Basic Payment might change its name.

The Sustainable Farming Incentive will then have run across England for two years while Local Nature Recovery, Landscape Recovery and other schemes will be moving into place for 2024.

The bigger driver comprehensively informing policy across the UK is climate change. While the UK has done much to decarbonise electricity – favourable conditions on Easter Monday saw its lowest carbon cost ever at 39g/kWh – the harder work is coming, with pressure growing on buildings and rural land management.

The Scottish Government, now recognising that it has left the EU and the CAP, has written the headlines for agricultural policy in its Scottish Climate Change Update Plan, setting it within rural policy with substantial forestry and peatland restoration. Aiming for net zero, this sees environmental conditionality for beef payments this year and more broadly next year. The Suckler Beef Climate Group has reported on ways, many simply good business, to reduce emissions by 35 per cent before further falls in cow numbers become inevitable. The challenge is starker in Ireland, where agriculture produces 34 per cent of emissions.

Heralding market pressure on housing, Paragon Bank has launched 80 per cent LTV buy-to-let mortgages on properties in EPC Bands A to C, while the Government is using climate change as an argument for diverting its increased English housing numbers into cities.

Whether the new technologies, requiring increased slurry storage capacity or the fate of sugar beet as a crop, the pressures for change in farming practices and structures accelerate requiring skills, investment and market awareness. As we come to glimpse what UK farming might be outside the CAP, the CAAV publishes next week a review of future rural land uses.

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