Defra considers ways to avoid another SFI debacle

Defra is weighing up a number of options as it seeks to improve the way the Sustainable Farming Incentive (SFI) application process operates before launching the next iteration of the scheme in 2027.

Addressing a Tenant Farmers Association (TFA) webinar on Wednesday (21 October), Defra’s acting director general for food and farming Mike Rowe said the department recognised the stress the narrow application window on 22 September had caused for many farmers who could not get into SFI26.

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Mr Rowe blamed exceptionally high demand, which he said was partly due to the gap from when SFI24 had to close last year, but also because changing market conditions meant more farmers were looking to SFI to provide an alternative income source.

Despite increasing the budget for Window 2 from £180m to £250m, this ran out in less than six hours.

“The simple problem is, the money that we had for new agreements this year clearly was not enough to meet demand,” he said.

Lessons to be learned

Mr Rowe said work was already under way to learn the lessons from SFI26, and to find a better way of sharing future funding.

“Minsters have already committed that we will move way from the ‘first come, first served’ approach,” he said.

Mr Rowe then listed a number of options being considered for SFI27. These include:

• Filter applications up front, setting out who might come into the scheme in what sort of priority
• Look at scoring applications for what they might deliver
• Reduce the number of actions on offer (as was done for SFI26)
• Lower payment rates and apply further area restrictions on certain actions
• Look again at the overall agreement cap (set at £100,000 for SFI26)

Technical glitches

Addressing questions about some of the technical glitches farmers encountered on 22 September, Rural Payments Agency grants director Tom Foster insisted that, in many cases, the system had blocked them correctly, be that for mapping issues or incompatible actions

“In a longer opening window, we would have sorted all of those out over the phone,” he said. “With a six-hour window that was difficult to do.”

There had been a particular issue for applicants with existing agreements expiring before February 2027, even though they had been encouraged to apply.

“With hindsight, that almost certainly contributed to the day one pressure, but was something that we wanted to do to make sure everyone had the opportunity. That is something we will have to think about for next year.”

Future improvement

TFA policy adviser Lynette Steele suggested a number of ways things could be improved for the future, including providing a multi-year budget.

“Fixed application windows, we can all agree, are going to be a better way of managing an application process going forward,” she added.

Ms Steele also stressed the need to deal with the “nitty gritty” issues, such as helping farmers with expiring Higher Level Stewardship and Countryside Stewardship agreements.

“While we are caught up in SFI at the moment, we have cohorts of farmers who have been stuck in agreements and unable to get into new agreements for multiple years,” she said.

Mike Rowe said Defra was very aware of the issue and was working to resolve it, but encouraged people stuck in exiting agreements to also look at going into Countryside Stewardship Higher-Tier.

“We’re trying to make it easier for people to access Higher Tier through the expressions of interest process and through more single action agreements that might be well suited to some tenants,” he said.

“So even if those trying to get into SFI have been disappointed, we’d urge people to look at Higher Tier as an alternative route that might fit with their business model.”

• The webinar can be watched back in full on the TFA’s YouTube channel.