Consultation outcome

Annex A: Stakeholder proposals

Updated 13 September 2018

We are grateful to all those who have agreed to have their views included. That agreement does not amount to an endorsement of the proposals outlined in the paper.

Over the last eighteen months, Defra has been engaging informally with a wide range of stakeholders across the UK to gather their views and ideas about the future. The opportunity to think about policy from first principles has been refreshing for many organisations. New, creative thinking has emerged in the aftermath of the referendum from both farming organisations and groups committed to improving our environment and enhancing animal welfare. This annex sets out some of the early suggestions that have emerged from these discussions, and invites further views from all those with an interest in our countryside and our environment.

A new environment scheme

The cornerstone of our new agriculture policy will be a new framework of incentives to support farmers for what they deliver for the environment and other public goods.

A number of organisations, including the Country Land and Business Association (CLA), Wildlife and Countryside Link, and Campaign to Protect Rural England (CPRE) ^{[footnote 1]} have argued that there should be a new type of land management ‘contract’ that rewards farmers for the provision of public goods on their farms.

We have access to a lot of data to evaluate hundreds of similar options that have been offered in recent decades; and a review of current measures will form one part of our approach to designing a new system (see Annex B). The UK’s departure from the EU provides the opportunity to design radically different arrangements and approaches, so we are keen to hear new suggestions and to work with farmers and land managers to design new schemes.

Numerous organisations, including the National Farmers’ Union (NFU) and the Green Alliance among others have argued that a new agricultural policy could support the development of innovative approaches and market-based rewards for the delivery of improved environmental outcomes in a future system.

There are a number of organisations that run UKAS accredited farm assurance schemes linked to good agricultural practices, resource management and the environment, e.g. LEAF Marque. There are also many other groups who have a strong track record in delivering local partnership work to deliver wildlife benefits and create habitats in a given location, including the Wildlife Trusts, the National Park Authorities and the Areas of Outstanding Natural Beauty Partnerships and Conservation Boards. Projects such as PINPOINT, The Rivers Trust partnership with Catchment Sensitive Farming, can also provide training and advice to farmers to reduce diffuse water pollution from agriculture. The National Park Authorities further support local delivery as a way to provide a wide range of public benefits at a landscape scale, through an approach which integrates environmental land management with farm productivity and the wider rural economy. In designing a new system, we will work with stakeholders and investigate the most effective ways to deliver environmental benefits at local and landscape scale.

A number of organisations have also suggested that we work on models that reward outcomes and results, in addition to incentivising environmental inputs. Identifying consistent and reliable methods to assess performance on an individual farm is challenging but we want to work with stakeholders to further test and pilot these approaches. Many organisations, including the NFU, have identified that future payments must truly incentivise and reward farmers for the delivery of public goods and that the government should look to address this in designing new schemes.

Animal health and welfare

The Animal Health and Welfare Board for England has recommended that ministers consider allocating funds for a transitional period to support the livestock industry in improving the health and welfare of farmed animals. The Board believes that by developing a coordinated approach to addressing disease, the industry will achieve greater competitiveness and productivity, an enhanced national reputation to meet the future trade environment and deliver wider public benefits such as lower antimicrobial use and improved biosecurity. The health and welfare councils for cattle, sheep, pigs and poultry have identified a need to strengthen data on endemic disease and to develop coordinated action between farmers, industry, vets, government and others to tackle it.

A number of organisations including Compassion in World Farming and the RSPCA have argued that we should consider options to incentivise high welfare in livestock production and to create reward payments for welfare outcomes above the legislative minimum. By way of example, Farmwel and FAI Farms in Oxford have been working on a number of proposals that may eventually enable the assessment of some welfare outcomes at the point of slaughter to support this. It has also been suggested that financial incentives to support higher animal welfare could help to solve the problem of unwanted bull calves in specialist dairy herds. The NFU has highlighted concerns that if welfare standards are raised, domestic producers could be left at a competitive disadvantage, and that any additional costs and burdens must be rewarded either by the market or by government.

The economics of farming in marginal areas

A number of concerns have been raised about the financial resilience of many farming businesses in more marginal areas such as the uplands (LFAs) and common land. Some organisations, like the Uplands Alliance, have pointed out that the current CAP disadvantages upland areas because they receive less BPS payments compared to lowland farms ^{[footnote 2]}, but, in many respects, actually have the potential to deliver far more by way of environmental goods, in part because uplands and commons often retain more characteristic wildlife than the arable lowlands. Upland farms and common land can often provide more access to their land; and access to some of these beautiful areas is often in greater demand from the public. They are also able to assist in flood mitigation projects by holding water uphill on their land at times of heavy rainfall; help with carbon sequestration; and improve water quality through peat bog restoration.

Changing the culture of regulation

Many farmers and landowners support efforts to reduce complexity and disproportionate penalties. We have an opportunity to foster a new regulatory culture in agriculture. Some organisations have suggested that we should allow farmers and land managers to enrol onto the new environmental land management scheme at any month of the year to suit their own circumstances and to spread the administrative burden for delivery bodies. Some farmers and land managers have also said that the current system, with arbitrary annual deadlines and risk of a total financial loss if their application is lost in the post, is unfair. Some farmers and landowners have also expressed a preference for their payments to be spread across the year, either monthly or quarterly by standing order, to smooth their cashflow.

Improving the profitability and productivity of farming

During an agricultural transition, we want to work with farmers to enable them to improve their profitability and productivity. Organisations such as the CLA have also called for measures to improve the productivity and profitability of farming. The NFU have suggested that we open a grant scheme similar to the Farming and Horticulture Development Scheme of the 1970s which helped re-equip and modernise many British farms. Others have suggested that support would be better targeted at financial instruments so that there are government-backed loans or tax incentives offering a broader range of less prescriptive support to help each individual business invest in what is right for them.

The Horticultural Trade Association (HTA) have suggested that collaborative government-industry effort to expand our plant nursery sector would boost domestic production and market demands, and have suggested that the current biosecurity threat from a range of serious pests and diseases makes this opportunity all the more important. In addition, they have suggested that government support for innovation in this sector would drive the development of plants with environmental benefits such as ‘super street trees’ which absorb air pollutants, and green roof substrates that absorb storm water.

The British Growers Association have suggested that we should provide grant support to groups of producers who want to collaborate and work jointly on research and development projects such as plant breeding, crop protection and crop storage. Some of the best examples of collaborative working and successful R&D have occurred where an integrated supply chain works together to deliver clear and tangible benefits such as improved returns, lower production costs and better product quality, for instance in the soft fruit industry or in sugar beet production.

The British Society of Plant Breeders have suggested a clear role for plant breeding to deliver the vision presented by the Secretary of State at January’s Oxford Farming Conference, and that success of the vision will be greatly supported by ensuring access to the best genetics delivered through plant breeding innovation and high quality seed. They have also said that the UK must remain an attractive place for plant breeders to invest.

Enabling structural change

A number of organisations including the National Federation of Young Farmers Clubs, the Tenant Farmers Association and members of the Tenancy Reform Industry Group (TRIG) have made the case that we need to consider ways to encourage and support young farmers and create more opportunities for new entrants in farming in the future. TRIG suggested reforms to tenancy law, refreshing the council farms model and increased provision of advice on retirement and succession planning for older farmers to facilitate structural change and improve productivity in the tenanted sector. The Central Association of Agricultural Valuers suggested new incentives to encourage owner occupiers who need to retire to rent their land out on longer term tenancies, to facilitate structural change and promote productivity and innovation by moving land into the hands of new entrants and skilled farmers.

The Horticultural Trade Association have argued for government support to help this sector create a strong UK skills pipeline and to change the poor perception of this sector as a career choice.

The NFU have also suggested that we introduce measures to help farmers manage risks and price volatility by fostering the creation of insurance schemes and futures markets for agricultural commodities. The NFU have also argued for the adoption of policies used successfully in New Zealand and Australia where farmers are able to establish a “crisis reserve” fund during good years with deferred tax arrangements, and they can they draw on that reserve as a buffer during difficult years.

UK frameworks

Farming unions and organisations representing Wales, Scotland and Northern Ireland have expressed views on the need for differing regional flexibility in the design of new policies to recognise devolution. At the same time, many have acknowledged that UK frameworks may be required to ensure policy divergence across the UK does not result in unfair competition or market distortion. Stakeholders have urged all four nations to work together to agree UK frameworks.

1. www.cpre.org.uk/resources/farming-and-food/farming/item/4347-new-model-farming and www.cpre.org.uk/resources/farming-and-food/farming/item/4647-uncertain-harvest-does-the-loss-of-farms-matter ↩

2. Approximately 70% Basic Payment Scheme payments received in uplands compared to 91% payments received in lowlands ↩