Defra reintroduces £150m of capital grants in England

Capital grants are being reintroduced by Defra for farmers in England, after the scheme was unexpectedly closed last November, providing £150m in funding for 78 specified items.

The new package forms part of the £11.8bn the UK government has committed to sustainable farming during this parliament and will fund a wide range of on-farm projects, including tree planting, flood prevention, slurry storage and water filtration.

“This major investment will give them [farmers] the tools to cut pollution, restore nature, and grow their businesses,” said Defra secretary Steve Reed. 

See also: Defra blunder leaves thousands of farmers in SFI limbo

Defra has introduced four new items to the list since last year, including assessing woodland condition, creating wildfire management plans, repairing drystone walls and hosting educational visits.  

To make the funds go further, funding limits are being set for four of the six groups of capital items listed.

This includes a £25,000 maximum per farm for water quality, air quality, and natural flood management, and a £35,000 maximum for the group covering boundaries, trees, and orchards.

Defra says this will help it manage its budget more effectively, adding that anyone who has previously submitted an application will have it processed and be offered an agreement, if eligible.

Defra also stated that the scheme will close to applications when the available funding is committed but, while it aims to give “reasonable notice” of scheme closure, “this may not be possible”.  

Industry response 

The Tenant Farmers Association (TFA) said the reintroduction of capital grants was a positive development, helping farmers to invest in much-needed infrastructure projects and future-proof their businesses.

“Following the sudden closure of the scheme last November, many farmers were left without vital support.

“Steps must be taken to ensure greater continuity now the grant funding has reopened,” said Lynette Steel, TFA farm policy adviser.

NFU deputy president David Exwood said the new capital grants would help deliver swift environmental gains and complement other on-farm activity and schemes.

“While the cap on funding may put limits on some farms’ environmental ambitions, it is important that as many farms as possible are able to access funding to support investment in things like water quality, wildfire management and sustainable food production,” he said.

The Country Land and Business Association (CLA) also welcomed the funding, especially considering the Sustainable Farming Incentive abruptly closed in March and the previous capital grants scheme was unexpectedly withdrawn last autumn.

“Farmers need confidence that this round will run smoothly,” said CLA president Victoria Vyvyan, encouraging farmers to closely look at the options.