FW Opinion: Are we heading for a subsidy postcode lottery?
© Tim Scrivener Where in the UK would you go if you were setting up a farming business this year?
Buyers and tenants looking for their next holding have always had to consider a long list of factors, including land area and quality, suitability of buildings and price.
But how many will in future be ruling a particular UK nation in or out based on their diverging farm policies?
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Recent statements by the Scottish, Welsh and Northern Irish governments signal it will be several years until area payments for farmers in those areas decline, while payments for farmers in England will have halved by 2024.
See also: FW Opinion: 2022 set to be year we get farm policy clarity
Northern Ireland is even consulting on bringing back headage payments – perhaps similar to the existing Scottish scheme.
This week, George Eustice reiterated that he intends for Defra to spend two-thirds of its future budget on higher-level environmental schemes once area payments are fully phased out in England by 2028.
This would see £2.4bn split evenly between the bottom-tier Sustainable Farming Incentive, the middle-tier Local Nature Recovery (replacement for Countryside Stewardship) and the ambitious top-tier Landscape Recovery scheme.
All this means we are heading towards a time where what farmers in different parts of the UK get from government will never have been more diverse.
It is clear Defra is more keen to create a habitat for endangered species such as the water vole and the Eurasian curlew, while leaving others, such as the lesser-spotted hill farmer, to fend for themselves.
In a few years there could well be a situation where a marginal business in Powys or Perth will still be profitable without changing how they farm, while one in Cumbria or Cornwall will be in the red.
If the English farm received £55,000 in Basic Payment Scheme money in 2020, it will be paid £25,750 in 2024 and nothing by 2028, while those in the devolved nations could only just be beginning to taper down.
As we know, even if the English farmer can bring that number up again by participation in environmental schemes, the proportion that is profit will be much smaller than it is now.
It is clear Defra is more keen to create a habitat for endangered species such as the water vole and the Eurasian curlew, while leaving others, such as the lesser-spotted hill farmer, to fend for themselves.
Some will say if the farmer will, in future, be able to nest more comfortably in other parts of the UK, that it is simply devolution at work, and the other governments are to be lauded for having different sets of priorities.
Yet, like England, they have very ambitious environmental goals to fulfil as well. Here is their conundrum – if they continue with area payments in the long term to support the viability of marginal businesses, they will have a smaller pot left for everything else.
Year by year, the pressure will ratchet up on politicians – not so much to protect a few livelihoods as to show environmental improvements are being achieved.
There is much talk of linking area payments to green outcomes, such as measures proposed last year by NFU Scotland, which could square this circle.
But if Defra is desperate in future to increase participation (which seems likely), it could have more wiggle room to increase payment rates for the highest-value actions, without breaking the budget, if it had no area payments to distribute.
For this reason it still feels likely that all nations will eventually end up converging on differing versions of the English model, rather than having radically different schemes.
Wherever in the UK you’re doing a long-term budget, it would still be prudent to assume an area payment of zero as things stand.