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Grants and Subsidies

The Agriculture Act represents a significant policy change for the industry, introducing a raft of new schemes focusing on the environment, investment and farm profitability.

Written by Matthew Sawdon

Through the agricultural transition plan, the Government sets out its vision. It’s a useful starting point, although currently it does not provide all the answers and we await detailed, costed guidance.

WHAT IS CURRENTLY AVAILABLE?

Basic Payment Scheme: Cuts made from 2021, deeper than originally envisaged, with payments ending in 2028. Entitlements are likely to be “de-linked”, removing the need to match against land.
Woodland grants: The Woodland Carbon Fund currently pays up to £8,500 per hectare for new tree planting, with the potential to increase income through carbon credits. With the Government’s manifesto commitment to increase woodland cover from 10% to 12% in England by 2060, we expect woodland creation and management to form key components of the new schemes.
Countryside Stewardship: The existing Countryside Stewardship Scheme will remain open until 2024. The government intends to remove some of the bureaucracy which has affected uptake in the past.

WHAT NEW SCHEMES ARE LIKELY TO BECOME AVAILABLE, AND WHEN?

The focus of policy centres on the Environmental Land Management scheme (ELMS), which consists of three themes:

  1. The Sustainable Farming Incentive:
    Open to everyone supporting environmental husbandry such as improving soil, water, and hedgerows. Farmers are likely to opt for “packages” tailored to the farm type, with differing levels of management and payment. Available from 2022.
  2. Local Nature Recovery:
    Creating, managing and restoring habitats, such as species-rich grassland. Similar to the Higher Tier of Countryside Stewardship. Expected in 2024/5.
  3. Landscape Recovery:
    Major changes to land use in order to significantly enhance the landscape, restore wilder landscapes and meet national targets. Likely to involve collaborative activity, over large areas. Expected in 2024/5.

In addition to ELMS, a number of schemes will focus on increasing farm productivity and investment and are anticipated to be rolled out from 2021:

  • Farming Investment Fund:
    Grants for investment in new equipment and technology aimed at increasing business performance. Eligible investments might include robotic technology and equipment for processing agricultural products.
  • New Entrants Scheme:
    Funding to assist with accessing land and infrastructure.
  • Slurry Investment Scheme:
    A grant which will pay a proportion of the costs of covering an existing slurry store or creating new stores to meet environmental requirements.
  • Farming in Protected Landscapes:
    Payment for environmental and access improvements in National Parks and Areas of Outstanding Natural Beauty.
  • Animal Health and Welfare:
    Promotion of higher-welfare animals above required standards. Potential for a “payment by results” approach.

HOW CAN I APPLY?

The details aren’t known yet, but grants and subsidies have been around for decades and many of the criteria are likely to be similar.

  • Does it meet the scheme requirements? For larger projects, writing an expression of interest and a proposal to demonstrate how your project fits within the aims of the grant can be required.
  • Value for money: Grants for capital equipment or building projects are likely to require two to three individual quotes, to ensure value for money.
  • Finances: Most grants fund a percentage of the costs, with the farmer paying for the total up-front and claiming the grant element back. It is vital you have the funds or have secured the finance for your project before applying, to ensure financial feasibility. For significant projects your bank or our team of Agricultural Mortgage Corporation Agents can assist you with loan applications.
  • Planning Permission: As an example, the Slurry Investment Scheme starts in 2022. Planning permission for this or any development project will be required prior acceptance of a grant proposal, or the grant will be conditional upon such consent. Our planning team is experienced in farm building, storage, diversification and rural tourism ventures.

CAN I GET PAID TO EXIT THE INDUSTRY?

In short, yes. An exit scheme, or retirement fund, is proposed from 2022. It will enable an existing claimant to receive a lump sum payment based on the remaining BPS payments payable through the transition period.

HOW CAN WE HELP?

At first glance the schemes look complex, but they offer significant opportunities for proactive farmers to invest in their business.

Our team is experienced in grant funding, environmental schemes, planning applications and AMC finance. Call us today for a no obligation chat on 01233 506201.


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