NFU demands £1bn SFI27 budget after SFI26 chaos

The NFU is urging Defra to recycle £960m from expiring agri-environment schemes into a Sustainable Farming Incentive 2027 (SFI27) budget of more than £1bn, warning farmer demand will once again outstrip supply.

NFU analysis suggests 48,000 English farmers could seek an SFI27 agreement.

These include holders of SFI23, expanded SFI, Countryside Stewardship and Higher Level Stewardship deals expiring by or in 2027, plus those who missed out on SFI26.

See also: Sustainable Farming Incentive 2026: The haves and have-nots

The union wants SFI27 to open in early 2027, with agreements starting from 1 April.

Further NFU asks include:

• Allocate funding on a £/ha basis to maximise access, while maintaining viable payment rates that properly reward farmers
• Open SFI and Higher Tier schemes to common land as a matter of urgency
• Set out a clear Environmental Land Management (ELM) roadmap for this Parliament, including scheme opening dates and transparent budgets to help farmers plan with confidence.

NFU vice-president Robyn Munt said: “Farmers have shown in their droves that they want to take part in agri-environment schemes.

“The experience of SFI26 left no doubt about the strength of that demand.”

But she added: “The ball is now firmly in Defra’s court.”

SFI26 chaos

The 2026 SFI scheme will be remembered for its chaotic finale.

A second application window, offering £253m in funding, closed within six hours on 22 September after all available funding had been snapped up.

Thousands of farmers were left unable to apply, fuelling criticism that the scheme had been significantly underfunded.

Defra received 12,200 applications in Window 2, and officials estimated upwards of 10,000 more farmers wanted to apply but could not.

Industry organisations believe many more farmers were seeking agreements.

The NFU said demand for environmental agreements far exceeded available funding, with more than £520m of agreements due to expire against a £310m budget for new SFI26 agreements.

Defra stance

Defra farming minister Stephen Morgan has promised change, including scrapping the “first come, first served approach” and bringing SFI27 forward as early as possible.

Defra’s indicative figures show £1.95bn for ELM schemes in both 2026-27 and 2027-28, within a Farming and Countryside Programme budget of £2.32bn and £2.27bn respectively.

However, Defra has not published a forward breakdown of the indicative ELM funding between SFI, Countryside Stewardship Higher Tier, Landscape Recovery and capital grants. It says final allocations will be agreed through business planning.

A Defra spokesperson said: “We are backing our hard-working farmers with the largest nature-friendly budget in history, committing £11.8bn to be fully spent on sustainable farming and food production over this Parliament.

“We are already looking at how we can improve SFI27 and work closely with farmers as we shape the next phase.”