Guidance

Agreement holder’s guide: Capital Grants, Higher Tier capital grants, and Protection and Infrastructure grants 2024

Published 3 January 2024

Applies to England

This Agreement Holder’s guide covers: 

• Capital Grants  
• Higher Tier Capital Grants 
• Protection and Infrastructure grants 

References to ‘capital grants’ refer to all 3 grants.  

References to Capital Grants refer to Capital Grants only.

A capital grants agreement comprises: 

• the scheme Terms and Conditions 
• an Agreement Document (which sets out specific details for the Agreement Holder) 
• the supplementary documents referred to in the Agreement Document 

The Terms and Conditions (Annex 1) refer to the mandatory sections of this guide that Agreement Holders must comply with. 

Capital grants agreements are for a maximum of 3 years. 

Your agreement will usually start from the first day of the following calendar month after you have accepted the agreement offer. The exact start date of your agreement will be set out in your Agreement Document. 

You must comply with mandatory guidance in: 

• section 6: Capital grants requirements and procedures 
• section 7: Manage your capital grant agreement

6. Capital grants requirements and procedures

6.1 Entering into an agreement 

If your application is successful, we will send you an agreement offer. To accept, you must return the signed acceptance declaration to us within 20 working days of the date on the offer. You have 3 calendar years to complete capital works from your agreement start date. The agreement start date is shown in your agreement offer. 

If you do not accept your offer in time, we will withdraw it.  

If you have a Site of Special Scientific Interest (SSSI) on land within your proposed agreement, you must not start work on the agreement until SSSI consent is granted by Natural England. 

You cannot modify, extend or amend your agreement after you have accepted it without written permission from the Rural Payments Agency (RPA). See section 7.3. 

6.2 Evidence: record keeping and site visits 

You must keep all invoices, receipts, accounts and any other documentation relevant to how the grant was spent for at least 7 years from the end date of the agreement. We need this evidence to show that public money is being spent effectively and is delivering the intended results. 

All records you keep must demonstrate you started the capital work or purchased materials on or after the agreement start date. We will reject claims and not pay them if you bought items or started work before your agreement start date. 

Keep records as evidence to show: 

• you are eligible for the scheme 
• the activities funded under your agreement are appropriate 
• the funded activity is taking or has taken place 

You can use your normal farm records to meet scheme requirements, but you may also need to keep additional records specifically about the work being funded. 

You’ll find the records you must keep for each capital item in Grant finder. 

6.2.1 When you must provide evidence  

You must keep any required evidence and supporting documents and have them available on request. 

Evidence to support your application

You must keep evidence to show that you, your business, your land or capital items are eligible as you may have to show this if you are chosen for a site visit. 

During the agreement and durability periods

You may need to provide evidence to show that you have carried out the required actions: 

• to support a claim - more information is set out in the following sections and where relevant further information will be sent with the claim form covering letter 
• during or after an administrative check, a site visit, or other checks as described in section 7.6 
• during the durability period, see section 7.1 for more information 

6.2.2 General evidence requirements for applicants and Agreement Holders 

It is your responsibility to get all consents, approvals or permissions that you may need to meet your specific circumstances and to complete the capital works. These consents, approvals and permissions must remain effective for the duration of the agreement and the durability period.  

6.3 Photographic evidence 

You need to keep dated photographic evidence for capital items to support an application and any claims. You must have this evidence available when we ask for it, for example as part of administrative record checks or during site visits.  

The need for dated photographic evidence depends on the particular capital item. Check the capital item requirements using Grant finder.

6.3.1 Before work stage 

For some capital items you need to take dated photographs and keep them to show where work or management will be carried out on a  feature or site. Check the capital item requirements using Grant finder to see if this is the case. Your photographs must meet the required standards, see section 6.3.4   

6.3.2 During work stage 

This section only applies to Capital Grants and Higher Tier Capital Grants. This section does not apply to Protection and Infrastructure grants. 

For some capital works, you will need to keep and submit contracts, invoices, or other documents, to confirm you’ve met the technical specification for the completed works. If you are unable to provide this, you will need to keep and submit dated photographs of the site during the different stages of construction to show that you’ve met the minimum specification. These capital works are:

For Capital Grants  

Item code	Description
AQ1	Automatic slurry scraper
AQ2	Low ammonia emission flooring for livestock buildings
LV3	Hard bases for livestock drinkers
LV4	Hard bases for livestock feeders
LV5	Pasture pumps and associated pipework
LV6	Ram pumps and associated pipework
LV8	Pipework associated with livestock troughs
RP3	Watercourse crossings
RP4	Livestock and machinery hardcore tracks
RP6	Installation of piped culverts in ditches
RP7	Sediment ponds and traps
RP9	Earth banks and soil bunds
RP12	Check dams
RP13	Yard – underground drainage pipework
RP14	Yard inspection pit
RP15	Concrete yard renewal
RP24	Lined biobed plus pesticide loading and washdown area
RP25	Lined biobed with existing washdown area
RP26	Biofilter
RP27	Sprayer or applicator load and washdown area
WN5	Pond management (100m2 or less)
WN6	Pond management (more than 100m2)

For Higher Tier Capital Grants

Code	Description
AC1	Access capital items
FM1	Management of geodiversity features
FM2	Major preparatory works for priority habitats (creation and restoration) and priority species
HE1	Historic and archaeological feature protection
FG5	Fencing supplement – difficult sites (this item can only be applied for with FG7, FG8 and FG9)
FG7	Anti-predator combination fencing
RP8	Constructed wetlands for the treatment of pollution
SB1	Scrub control and felling diseased trees
SB3	Tree removal
TE13	Creation of dead wood habitat on trees

6.3.3 Claim stage 

For a partial or full claim, you must take a dated photograph after you have completed work and send it with your payment claim. This must show the condition of completed work. You must take ‘before work’ and ‘works completed’ photographs from the same position. 

6.3.4 Photographic evidence quality 

All photographs must meet the following standards. This applies to digital and printed photographs.

Quality – photographs must be in focus and clearly show the relevant capital item or environmental feature. If you send your images by email, please send as JPEG files.  

Digital images should not be smaller than 600 pixels by 400 pixels and ideally an image file size no larger than 400KB. Printed photographs must be no smaller than 15cm by 10cm. Photographs can be portrait or landscape. 

Photographs must identify the environmental feature or capital item(s) concerned – it is your responsibility to show enough evidence that the investment or required management has taken place. For example, you may need to take more than one photograph if the feature or capital item is too large or not clear from a single photograph. 

Where possible, include a significant feature to provide authenticity, for example, a ditch, fence, farm building, road or telegraph poles. 

Where possible, mark the photographed feature’s location and the direction from which the photograph has been taken, with an ‘X’ and ddd an arrow to correspond on a copy of a map (or map extract) of the agreement area. 

Where scale or continuity is important, include a feature, for example a quad bike, or vehicle or use a sighting pole (2m high with 50cm intervals marked in red and white). Take pictures consistently from the same spot for ‘before and after’ photographs of the capital item. 

6.3.5 Clearly label photographs 

Use the Ordnance Survey (OS) map sheet reference and National Grid reference for the field parcel where the works are taking place, followed by: 

• the relevant proposed or implemented capital item code 
• date 
• Agreement Holder name 
• SBI 
• image number if you are sending more than one image 

The OS map sheet reference and National Grid reference should relate to the field parcel adjacent to the boundary and what you used in your application. For example, if we ask you to send ‘before and after’ photographs to support capital items, the images should be labelled as OS Ref Capital item code_Date_Name_SBI_Image number. 

Save digital images using file names as described in labels.  

6.4 Publicity requirements 

The Terms and Conditions require you to comply with all instructions and guidance relating to acknowledging and publicising the support provided. This includes using any materials or templates which are provided for this purpose.

7. Manage your capital grant agreement 

You must only start work (this includes  purchasing materials) on or after the agreement start date. We will not pay for materials and work done before this date. 

You must complete all capital works within 3 years of the agreement start date. 

You can submit a claim for payment when you have finished the works and you have been charged or invoiced by the contractor or supplier for the items or activities You must keep receipted invoices that show you’ve paid for the works and provide them on request. 

Part-claims are allowed for some, but not all items. See section 7.5. 

7.1 Agreement period 

Agreements are for a maximum of 3 years, from the start date of your agreement. The agreement may not run for the full 3-year period if you finish the works before then. 

During this period, you must complete all capital works. You can submit a claim for payment when you have finished the works and you have been charged or invoiced by the contractor or supplier for the items or activities. 

You will then have a further 3 months from the end of the agreement period to submit your payment claim. 

You must maintain any capital items funded through these grants in the same condition and to the specification set out in your agreement for a minimum of 5 years from the agreement start date. This is called the ‘durability period’ of the agreement. 

You must also have management control of the land for the length of the capital grant agreement. Section 3.3 of the Applicant’s guide explains how this ‘durability’ requirement applies if you are a landlord or a tenant. 

For Capital Grants only 

If you have an existing CS Mid Tier or Higher Tier agreement that includes capital works that you have completed and claimed for, you can apply for a new Capital Grant for additional works on those parcels. You do not have to wait for your existing CS Mid Tier or Higher Tier agreement to end. You can have one Capital Grants agreement per calendar year, per SBI. 

7.2 Change in circumstances 

You must notify us in writing without delay if there is a change in your circumstances that might: 

• affect the amount of funding you have been or will be paid 

• prevent you from complying with the conditions of your agreement 
• prevent you from carrying out the work set out in your agreement, including preventing you from carrying out the work to the agreed standard or in the agreed timeframe 
• affect your continued entitlement to agreement funding, for example if you no longer have management control of the land parcels included in your agreement 

7.3 Changes to your agreement 

You can ask for a change to your agreement if you have an exceptional change of circumstance. We will only agree to changes that are necessary to achieve the objectives of the scheme. 

You need written permission from us before you can amend or reschedule approved capital items. You should contact us if you would like to discuss changes before the end of the original agreement period to complete the capital items.  

We must agree to the request before you make any changes to the item, its location, or timing. You may need to repay all or part of previous payments that you have received. 

We will write to confirm if your request is successful. The change will not be valid until you have received the written confirmation and the date when the change can take effect.  

7.4 Carrying out capital works 

7.4.1 Using own labour to carry out capital works 

You can use your own labour or a farm employee’s labour to carry out capital works. If you do so, you will need to prepare time sheets signed by the employee and employer showing: 

• the hourly rate for your labour or a farm employee’s labour 
• what work was carried out 
• the date the work was done 

You must tell the employee(s) about your agreement and its requirements. It is your responsibility to make sure that work carried out using your own labour or a farm employee’s labour, does not breach the terms of your agreement. You will be responsible for any payment reductions if the employee commits any breaches or the work does not meet the required standard. 

For Protection and Infrastructure grant agreements only 

For FY2: Woodland infrastructure we will pay 40% of actual costs (including VAT and agent’s fees, where applicable). If you are using your own labour to complete this item, we will pay 80% of the 40% value. 

7.4.2 Using contractors to carry out capital works 

You can employ contractors to carry out the work needed for the capital items. 

You must tell your contractor about your agreement and its requirements. It is your responsibility to make sure that work carried out by contractors does not breach the terms of your agreement. You will be responsible for any payment reductions if the contractor commits any breaches or the work does not meet the required standard.

7.5 Make a claim for payment 

You can submit your claim when you have: 

• finished the works; and 
• been charged or invoiced from a contractor or supplier for the capital items 

The minimum claim value is £500. You can submit a claim for payment at any time of the year. We aim to pay valid claims within 2 months of receiving them. 

If you are making interim claims, the minimum claim value of £500 does not apply to your final claim. 

We must receive all claims for payment no later than 3 months after the agreement end date. 

If we receive a claim: 

• more than 3 months but less than 6 months after the agreement end date, a late claim reduction will be applied 
• more than 6 months after the agreement end date, the claim will not be accepted, and no payment will be made 

For Capital Grants only 

We cannot accept part-claims for the following water and air quality capital items: 

Item code	Description
AQ1	Automatic slurry scraper
AQ2	Low ammonia emission flooring for livestock buildings
RP4	Livestock and machinery hardcore tracks
RP7	Sediment ponds and traps
RP8	Constructed wetlands for the treatment of pollution
RP11	Swales
RP13	Yard – underground drainage pipework
RP15	Concrete yard renewal
RP17	Storage tanks underground
RP18	Above ground tanks
RP22	Sheep dip drainage aprons and sumps
RP24	Lined biobed plus pesticide loading and washdown area
RP25	Lined biobed with existing washdown area
RP27	Sprayer or applicator load and wash-down area
RP28	Roofing (sprayer washdown area, manure storage area, livestock gathering area, slurry stores, silage stores)
RP29	Self-supporting covers for slurry and anaerobic digestate stores
RP30	Floating covers for slurry and anaerobic digestate stores and lagoons

For Higher Tier Capital Grants only

We cannot accept part-claims for water capital item RP8: Constructed wetlands for the treatment of pollution. 

7.5.1 Submitting claims 

You’ll need to sign into the Rural Payments service to submit your claim. 

You can read more about How to submit a capital claim online. 

If you cannot make a claim online, contact us to ask for a claim form – go to Annex 3 for our contact details. 

You must keep evidence to show that the work is finished. Section 6.3 explains the photographic evidence you need and what evidence is needed for individual capital items. 

You may need to submit necessary consents or permissions with your claim, or you may need to supply them on request. See the individual capital item specifications for details. 

You, as the Agreement Holder, must keep the completed items to the condition and specification for which the aid was granted for 5 years from the agreement start date (read section 7.1). This is a requirement of the agreement. 

This also applies to landlords where management of the agreement land reverts from the tenant Agreement Holder to the countersigning landlord during the durability period (read section 3.3 of the Applicant’s guide). 

7.6 Scheme checks and site visits 

We are required to make sure that capital grants are properly controlled, to protect public money. We carry out site visits to monitor Agreement Holder compliance with their agreements. 

We will check you have followed the advice and guidance. If we think there is an issue that can be resolved, we will offer further advice and guidance, or we may deal with any agreement breaches or non-compliances we find in line with section 7.7 and the Terms and Conditions. 

We carry out a number of checks on claims: 

• administrative record checks 
• rapid field visits 
• agreement monitoring visits 
• physical or virtual site visits 

You must allow any UK public authority (or their authorised representatives or auditors) to access your land or premises to carry out site visits. 

We will try to agree a date and time for a site visit where possible. If not, you will be notified at least 48 hours in advance of the site visit unless we have reasons to suspect that you are in breach of your agreement. 

You must co-operate with any person carrying out a site visit (including controls and spot-checks). You need to provide access to any land, premises, plant, equipment or documents if you’re asked. Any refusal to do so, or obstruction, will be treated as a breach of the Terms and Conditions and you may face recovery, suspension or termination of your agreement. We may also refuse support for other Defra grant schemes for up to 2 years. If this is the case, we will tell you and you will have the right to appeal against this decision.

7.6.1 Administrative record checks 

We will check all stages of your application and claims, including your application form, claim forms and the nature and quality of any supporting evidence we ask you to send us, such as receipts and farm records. This is to make sure that you meet eligibility requirements at the application stage, and that various forms and records match up during the whole agreement period. 

If you do not provide records when asked, or there are discrepancies, we will treat this as a breach of your agreement. 

7.6.2 Rapid field visits (in situ visits) 

As part of our administrative checks, we may make rapid and focused visual checks of your holding, targeted at specific capital items. These visits may include record checks. 

7.6.3 Agreement monitoring visits 

Advisers may visit sites to monitor environmental progress, discuss environmental outcome reports, or if you ask us to visit. 

7.6.4 Site visits 

Each year we will carry out site visits on a sample of agreements to make sure scheme requirements have been met. If we find an agreement breach, we may apply reductions (read section 7.6). 

You must follow the requirements for the specific item, including any specifications you need to adhere to and retain any records that are required to support your claim. 

If we find an agreement breach, we may apply reductions (read section 7.7). Find out what to expect from a site visit. 

7.6.5 Refusal or withdrawal of support claimed

In certain cases, we may refuse, or withdraw in full, the support claimed and terminate your agreement. We will do this if we think you have: 

• committed a serious breach 
• provided false evidence 
• negligently failed to provide the necessary information (for instance, where we have asked for it repeatedly and there is no good reason why you have not provided it) 

If we have to withdraw support for these reasons, we will terminate the agreement and you will not be permitted to re-apply for the scheme for 2 years. We may also refuse support for other Defra grant schemes for up to 2 years. If this is the case, we will tell you and you will have the right to appeal against this decision. 

7.7 What happens if you breach your agreement 

If you do not meet the terms of your agreement, we may reduce or withhold your payment or ask you to repay any monies we have already paid to you. 

If we find a breach, we will write to you to tell you. You’ll have the opportunity to appeal if you do not agree with our findings. If a breach is confirmed, we’ll work out the most appropriate action we need to take and let you know. We may apply more than one course of action depending on the breach found. We’ll assess the level of breach in a fair and consistent manner, on a case-by-case basis, using the following set of criteria: 

• to what extent the breach can (and will) be rectified 
• the circumstances, nature and consequences surrounding the breach 
• any failure to cooperate with site visits, or further investigations 
• any steps taken to report a change in circumstances 
• whether it is an isolated or a repeat occurrence 
• whether it was intentional 
• whether it was because of reckless or negligent action 

If there’s a breach of your agreement or the regulations, we may: 

• ask you to correct the breach 
• issue a letter explaining that we’ve assessed the breach and what you have to do to amend your agreement 

For more serious breaches, we may: 

• reduce the payments you get, or withhold part of them 
• reduce or withhold money from other schemes 
• recover money we’ve already paid 

In the most extreme cases, we may: 

• end your agreement 
• stop you receiving financial assistance under any other scheme for up to 2 years 

In exceptional circumstances where there is reasonable suspicion of a serious breach or fraud, we may access land and your premises without notice, using powers of entry. In these circumstances, for example as part of a fraud investigation, we may access any computer that’s been used in connection with the evidence or these records. 

If we find breaches during administrative checks or any site visits, we will write to tell you and you will have the opportunity to make written representations if you feel that our findings are incorrect. 

In these cases, we will work out the level of reduction we need to apply, by looking at the severity of the breach and whether it is an isolated or a repeat occurrence. We may apply a reduction to your claims, unless you can demonstrate you were compliant. 

7.7.1 Severity 

We will assess what has happened due to the breach or non-compliance and consider the objectives of your agreement or specifications that were not met. For example, constructing an item in a way that does not deliver what the item was designed for would be classed as a severe breach. As part of this assessment, we will also consider whether the breach will have short or long-term impacts. 

If we consider that a breach is so serious that it cannot be rectified, we may have to cancel your agreement. In serious circumstances, you may be forbidden from entering another Agri-environment scheme for up to 2 years. 

7.7.2 Re-occurrence 

The assessment will depend on a number of factors, for example whether a similar  breach has been found on previous claims and whether the re-occurrence concerns the same or a similar type of work. 

7.7.3 Over-declaration of expenditure 

If you submit a claim for more than the value of the costs which are eligible to be claimed, we will reduce the payment to the correct amount, or recover the amount of over-declaration if payment has already been made. 

7.8 Good reasons for a breach 

You may be unable to meet your requirements under the agreement because of exceptional circumstances. If this happens, you must write to tell us within 8 weeks from the date on which you (or any person authorised to act for you) are able to do so. You will need to provide evidence in writing to show: 

• what has happened 
• how the event meant you were unable to meet the terms of your agreement 

Good reasons for a breach may include, but are not limited to: 

• the death of the Agreement Holder 
• serious illness 
• a severe weather event 
• the accidental destruction of capital items connected to your agreement 
• damage caused by criminality 
• supply chain issues 
• an epizootic or a plant disease affecting part or all of your crops, trees or livestock 

We will consider the facts to decide whether or not the Agreement Holder is relieved of all or part of their obligations under the agreement, and whether all or part of the grant should be withheld or repaid. 

If you are aware of the issue when entering into your agreement, then it is unlikely to be considered a good reason for a breach. 

7.9 Change of ownership 

You cannot transfer your agreement during the 3-year agreement period. This requirement applies only during the 3-year period from the start of your agreement. 

If you sell or let, all or part of the land under your capital grants agreement to another party, we will end the agreement on those parcels. You may need to repay all or part of the grant payments you have already received. 

If, after completing your capital grants agreement, you sell or let all or part of the land previously under your agreement to another party during the durability period (see section 7.1), you may need to repay part of the grant payments you have already received. 

7.10 Disputes, appeals and complaints 

If you’re unhappy with a decision we have taken about your application or agreement, you can submit a complaint. 

If you’re unhappy with a decision we’ve taken or service you’ve had from us, you can ask us to reconsider. If you’re still unhappy with the result of our decision, you can appeal. 

Follow the RPA complaints procedure to raise a complaint. This also includes information on how to request a reconsideration or submit an appeal.