'Perfect storm' prompts call for farm subsidy phase-out to be delayed

A combine harvester and tractor at work in a Norfolk farm field

East Anglian farmers are calling for delays to proposed subsidy reductions amid a 'perfect storm' of challenges in the food chain - Credit: Peter Cutts / iWitness24

Farming leaders have called for post-Brexit reductions in farm subsidies to be postponed while growers battle "severe disruptions" to food businesses.

The National Farmers' Union (NFU) wants an urgent review of Defra’s future farming programme, including delaying the planned 2022 and 2023 reductions in the Basic Payment Scheme (BPS) - part of the land-based system of EU subsidies being phased out after Brexit. 

It says farmers are battling a "perfect storm", with a shortage of European workers bringing some supply chains to a halt, while costs are increasing against a backdrop of disrupted trade flows and a retail price war.

The National Audit Office also recently reported that key parts of the new "environmental land management" (ELM) scheme due to replace BPS are still not in place - threatening to reduce participation and the chances of its success in hitting green targets.

The NFU says a review would provide ministers with more time to develop the replacement schemes ahead of their scheduled full roll-out in 2024 - and for the food sector to move forward from the "multiple issues" it currently faces.

NFU East Anglia regional director Gary Ford said: “This change in agricultural policy represents the biggest transformation for farmers in generations. It’s imperative we get it right.

“Farmers are facing reductions in BPS payments amid huge challenges, with labour shortages, rising inflation that is adding increased costs to farms and disruption throughout the supply chain.

“At the same time, there’s a lack of detail and certainty on the environment schemes set to replace direct payments.

“We have real concerns for the future success of farming if the government presses ahead with its current timetable to transition to new agricultural policy schemes that simply aren’t ready.  

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“A postponement to the BPS reductions in 2022 and 2023, alongside a thorough review, to ensure the new policies and schemes are ready, is the right way to go."

Defra environment secretary George Eustice stood by the government's plans to replace the Basic Payment Scheme, which he said "achieved nothing more than inflated land rents and input costs, whilst preventing farmers from retiring and new entrants getting access to land".

“Since January, we have increased the money going to Countryside Stewardship [an existing environmental payment scheme], we have consulted on an exit scheme and we will be setting out plans to support new entrants," he added.

“Our reforms are incentivising farmers to farm more sustainably, create space for nature and enhance animal welfare outcomes. We are supporting the choices that farmers make for their own holdings.”

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