January 16, 2022

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UK’s post-Brexit farm payment overhaul fuelled by ‘blind optimism’

The UK government has not established any way to measure whether £2.4bn of annual post-Brexit farm payments will provide value for money and is failing to support English farmers facing steep cuts to EU-style subsidies, according to a damning report from parliament’s Public Affairs Committee.

The Department for Environment, Food and Rural Affairs has repeatedly missed its own planned milestones for unveiling the new green payments system, said the report, released on Sunday.

It added that the department has admitted that without more details, its own confidence in the scheme could appear to be “just blind optimism as far as farmers are concerned”.

The report from the committee, chaired by the Labour MP Meg Hillier, follows a series of announcements on the Environmental Land Management (ELM) scheme, which Boris Johnson’s government is introducing in England to replace the EU’s Common Agricultural Policy.

Ministers have set out plans for three tranches of the scheme based on payments for environmental work, but farming groups have become increasingly outspoken about concerns that not enough detail is in place.

Sir Geoffrey Clifton-Brown, the Conservative MP who serves as deputy chair of the committee, said: “We have known we were replacing the CAP since 2016 and still we see no clear plans, objectives or communications with those at the sharp end — farmers — in this multi-billion pound, radical overhaul of the way land is used and, more crucially, food is produced in this country.

“Farmers . . . have been left in the dark and it is simply wrong that Defra’s own failures of business planning should knock on to undermine the certainty crucial to a critical national sector.”

He warned that small and tenant farms, which operate on “wafer-thin” margins, risked going out of business during the transition given that they made a typical annual net profit of only £22,800 a year without subsidies.

This would mean that “the average size of farms will increase and some of the environmental benefits of [the new system] will be lost,” Clifton-Brown said.

Farmers were previously handed so-called direct payments based on land area, but they face losing half of these by 2024-25 as EU-style subsidies are phased out to prepare for the post-Brexit scheme. The payments accounted for more than half of farm business income, or net profit, on cereal, arable, grazing livestock and mixed farms in 2020-21, official data show.

The committee also echoed farmers’ concerns of potential unintended consequences from the new scheme — particularly that its incentives to convert farmland to other uses, such as forestry, will result in an increase in food imports, effectively “exporting” the ecological impact of food produced for UK plates.

Defra has not set out metrics or objectives to ensure that the payments provide value for money or contribute to the country’s goal of reaching “net zero” emissions by 2050, the committee said.

Without clarity on these goals “the government’s promised green Brexit looks increasingly out of sight,” said Dustin Benton, policy director at the charity Green Alliance.

George Eustice, environment secretary, said: “We disagree with many of the points made by the committee which fail to take account of recent developments.
 
“Farm incomes have improved significantly since the UK voted to leave the EU in 2016 and there will never be a better time to improve the way we reward farmers.”

Tom Bradshaw, vice-president of the National Farmers’ Union, said: “Farmers in England are extremely concerned about the development of ELMs and this report from the PAC should serve as a wake-up call to the government.”

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