Chancellor demands Defra cuts to plug ‘£20bn black hole’

Defra, alongside other Whitehall departments, has been tasked with finding £3.2bn-worth of savings to help plug a “£20bn black hole” in the public finances identified by chancellor Rachel Reeves.

Some nature groups have responded with concern to the news, warning that frontline delivery of agricultural programmes must not be affected by any budget cuts.

But George Dunn, chief executive of the Tenant Farmers Association, told Farmers Weekly the mood music he was hearing was positive, and that he expected the savings to be made from operational costs.

See more: Analysis – what would a Labour government do for food and farming?

“We’ve been trying to get a handle on what this situation means for Defra, and everybody I speak to in the department, while they are unable to say anything official, are coming across as quite pleased with the discussions they’re having with Treasury,” Mr Dunn said.

“They keep telling us to listen to what the chancellor doesn’t say as much as what she does say.

“Nothing she has said indicates that Defra programmes are going to face huge cuts. That’s hugely encouraging, but obviously it will be a few weeks before we have the formal detail.”

However, Vicki Hird, strategic lead on agriculture at the Wildlife Trusts, said rumours were still swirling about large cuts to the farm support budget – just one week after environmental groups including the RSPB called for an increase in funding from £3.5bn to £5.9bn.

“We hope the rumours are mistaken, as the evidence is clear we need more investment, not less, to future-proof British farming and support nature recovery,” Ms Hird added.

“The cuts proposed so far to Defra administration, communications and consultancies are, we hope, not going to slow the vital summer rollout of the new Environmental Land Management scheme in England.”

One area of spending which has come under pressure in the past is compensation for cattle culled under TB policy.

In a Farmers Weekly election special podcast in July, former Defra secretary George Eustice explained he had resisted previous attempts by civil servants to slash or remove compensation, and predicted it would be the “first area of contention” for the new government.

A Defra spokesperson said: “This government recognises that food security is national security. We will restore stability and confidence amongst farmers – that’s why the rollout of the Environmental Land Management schemes won’t be affected and our programme of grants will continue.

“We will optimise schemes and grants in an orderly way to ensure they produce the right outcomes for farmers, ensuring that our schemes work for those who have too often been ignored – including small, grassland, upland and tenanted farmers.

“The secretary of state has said he will fight the corner of farmers all the way as we get closer to the spending review.”

More details are expected to be provided in Ms Reeves’ first Budget, on 30 October.