The next step in the Agricultural Transition – an update on the Sustainable Farming Incentive
More detail has been announced by Defra on the Sustainable Farming Incentive (SFI) scheme, which is due to open in 2022, including the first details on a proposed Moorland and Rough Grazing Soils Standard. Commentators are giving the scheme mixed reviews, with some suggesting that the payments are insufficient to incentivise farmers to get involved, while others think that there will be little or no environmental benefit from the actions proposed.
In the context of the Government’s overall policy approach, it is perhaps most realistic to see this funding as an opportunity to start moving farmers towards a natural capital approach to the management of the land, starting with a fairly basic level of soil assessment and management. This is, after all, the start of the “agricultural transition” away from the CAP support of the past, towards a future where public money funds “public goods”.
So what have we learned from the Defra announcement?
What is the SFI?
The SFI is the most basic tier of the proposed three tiers in the Environmental Land Management programme and we are still waiting for more information on the other two tiers: the Local Nature Recovery and Landscape Recovery schemes. Despite Natural England promising an update in November 2021, we are now told that it will be the New Year before we hear more.
What do we now know about the SFI?
It is aimed at farmers in England who currently claim BPS (although after 2024 those who have not claimed BPS may be allowed to enter the scheme).
Farmers do not have to enter the whole farm into the scheme – they can choose to enter certain fields only.
Agreements will last for 3 years and can be amended annually, for example to add more fields or to incorporate new standards.
Tenant farmers with sufficient management control will be able to enter without requiring formal consent from their landlord.
Common land will be eligible, but it is expected that the commons association will be the single agreement holder.
Payments will be made quarterly.
Compliance will be by self-assessment with checks on eligibility and delivery made by remote sensing where possible.
The Standards
Three soil management environmental standards will be available from 2022, together with funding for an annual animal health and welfare review for cattle, sheep and pig farmers. More standards are expected to be added over time, such as nutrient management and integrated pest management standards (in 2023) and agro-forestry and water body buffering standards (in 2024). An organic standard is expected in 2025.
The standards available in 2022 will be:
The Arable and Horticultural Soils Standard
To be available at either an introductory (£22/ha/yr) or intermediate (£40/ha/yr) level.
For both levels, farmers will need to test for soil organic matter, develop a soil plan and ensure winter cover is in place for at least 70% of the land in the standard.
At the intermediate level, a sown green cover crop must be in place for winter months on 20% of the area entered into that standard.
Both levels will need organic matter applied each year to one-third of the area of land entered into the standard.
The Grassland Soils Standard
To be available at either introductory (£28/ha/yr) or intermediate (£58/ha/yr).
For both levels, farmers will need to test the land for its soil organic matter and develop a soil management plan.
For both levels, there must be at least 95% green cover of the land in the standard over the winter.
The intermediate level requires that herbal leys are established and maintained on 15% of the area entered into that standard.
The Moorland and Rough Grazing Standard is for land above the Moorland Line. Defra has published a draft introductory level for this new standard, which will require farmers to assess their moorland soils and habitats. Defra expects this introductory standard to be developed further as it tests its draft with farmers.
The payment will be £148 per agreement as a fixed sum, plus £6.45/ha of land within the scheme. In return for that payment, farmers will have to
Assess the soil type, peat status (including depth and wetness) and vegetation of all land entered into the standard and assess its condition
Do this by taking at least one sample per 10 hectares each year, at different points
Record the assessment on paper or electronically, including photographs.
Review the assessment annually and update it where required.
Farmers will then be expected to use this information to
Identify the “public goods” that could be delivered
Identify and record where and how improving the condition of the soil and vegetation could maintain or enhance the delivery of public goods
Produce a summary of opportunities to maintain or enhance public goods.
Defra will provide guidance, training and templates.
SFI and private sector schemes
Defra is anxious not to crowd out private sector schemes which might reward land managers for environmental benefits, so farmers will be able to enter land into the SFI if it is already in a private sector scheme or enter land which is already in the SFI into such a scheme, provided that there is no double funding and that all scheme rules are met. This position will be reviewed in 2023 as the market for private sector schemes starts to mature.
3rd December 2021