Days numbered for ‘delinked payments’ in England after Budget

Details of the continued phase-out of direct payments to farmers in England have been revealed by Defra following this week’s Budget, with all recipients seeing 76% of their base amount removed in 2025.

This compares with the 50% cut in so-called delinked payments (formerly Basic Payment Scheme money) that applied in 2024, and amounts to a considerable speeding up of the demise of the old support scheme.

See also: Delinked payments – information statements and transfers explained

Farmers receiving up to £30,000 will have 76% removed, but anything above that will be cut entirely.

In this way, a farmer who originally received more than £100,000 in the Basic Payment Scheme (BPS) will receive no more than £8,000 in 2025.

“We are accelerating the end of the era of payouts to large and wealthy landowners simply for owning land, with reductions applied in payment bands on a sliding scale,” said a Defra statement.

Protected

But Defra insists that the overall support budget for England is being protected, with £2.4bn available for 2025-26, plus another £200m of unspent funds rolled over from previous years.

Of this, £1.8bn is being targeted at the three Environmental Land Management (ELM) schemes – some £500m more than in the current financial year.  

“ELM schemes will remain at the centre of our offer for farmers and nature, with the Sustainable Farming Incentive, Countryside Stewardship Higher Tier and Landscape Recovery all continuing,” said Defra farming minister Daniel Zeichner.

Budget freeze

But while he claims this is the “largest ever budget directed at sustainable food production”, the Country Land and Business Association (CLA) has condemned what it sees as a budget freeze.

CLA president Victoria Vyvyan said: “The decision to keep the budget at the same level since 2014 – a cut in real terms – will have consequences for hard-pressed farmers, consumers and the environment.

“It will damage confidence and stability across the industry, risking farm profitability. It could hit sustainable food production and undermine improvements to wildlife habitats, flood management and access to nature.”

Scottish landowners representatives are also concerned.

“The chancellor has ignored the findings of the Bew Review, which has enabled funding for agricultural support to be ring-fenced in a separate block grant since 2021,” said Scottish Land and Estates chief executive Sarah-Jane Laing.

“Instead, agricultural funding will be linked to the Barnett Formula, which will incur a significant reduction in overall agricultural funding, with little sign from the Scottish government that they will be able to make up the difference.”

Farming Recovery Fund

There was better news with regards the Farming Recovery Fund.

The previous Conservative administration had earmarked some £50m to help farmers repair their land following last winter’s storm.

So far only £2.1m has been paid out, prompting fears that Labour may not honour the pledge.

But Mr Zeichner has now confirmed that the money will be going out “imminently” and has raised the amount to £60m.