Farmers should be means-tested before receiving government support, says a think tank report endorsed by former Defra secretary Caroline Spelman.
The report says farmers should have three forms of income available to them: sales from agricultural produce at market prices, payments for ecosystem services and a form of means-tested livelihood support targeted aimed at less well-off farmers.
“This should necessarily be targeted through the existing tax and benefits system and should seek to end the current situation where public subsidies are paid to owners of very large estates without any public good being received in return,” it says.
The report by Bright Blue – a think tank with close connections to the Conservative Party – says farmers and landowners would bid using online marketplaces to supply ecosystem services such as woodland creation, peatland restoration and removing invasive plant species,
Beneficiaries would include the government, local authorities, water companies, local communities and environmental groups.
Contracts for supplying ecosystem services would be paid quarterly based on results, potentially with incentives to encourage performance.
Report co-author Ben Caldecott said: “We have a unique opportunity to enhance this country’s natural environment as we leave the EU.
“Policies and funding for rural activity and the natural environment can now be brought together into a consistent framework.”
Former Defra secretary Dame Caroline Spelman said: “Bright Blue has made a useful contribution to the debate surrounding post-Brexit agricultural policy and correctly recommend a market-based approach which embraces all the stakeholders in agriculture.”
Country Land and Business Association (CLA) policy director Christopher Price said the report supported the CLA’s vision for properly rewarding farmers and land managers for providing environmental services.
But the proposal contained two particular flaws, he added.
“Although we may want to use more land for nature, this should not compromise our overall ability to produce food.
“Our ambition must be to deliver more profitable, more productive and more sustainable farming. It is entirely possible to do this alongside ambitious improvements in environmental management.”
The report’s ambition to base payment on environmental results was conceptually right, said Mr Price.
But sometimes payment for the activity was better.
“We know that creating beetle banks works for nature and reporting on the specific results of each bank would be needless bureaucracy.”