Budget increase for Welsh agriculture welcomed

Agriculture in Wales is set to receive millions of pounds of extra funding in the next financial year.

The Welsh government’s draft budget for 2025-26 was announced on Tuesday (10 December) and every department will get an increase, including Climate Change and Rural Affairs.

This department will receive an extra £71.95m in capital funding, up by 31% on the existing budget, and £36.35m more for revenue spend, an increase of 6.6%.

See also: Scottish government pledges £660m to support farmers

The government has pledged to maintain the Basic Payment Scheme (BPS) ceiling at £238m for 2025.

The uplift comes after years of tighter budgets and spending cuts, and after the farming unions had upped pressure on the government in recent weeks to safeguard their sector.

Union response 

The Farmers’ Union of Wales (FUW) applauded the increase, but says it still wants clarity on how the revenue funding will be distributed.

FUW president Ian Rickman said: “We do welcome the decision to maintain the BPS payment ceiling, which is crucial in providing a level of security for farmers in Wales as they face a plethora of other challenges and changes.”

Whilst additional funding has been provided for wider rural investment schemes, he said urgent questions remain on how this compares with the rural investment Wales historically received through the European support programmes.

“Looking ahead, it’s crucial that any increase in the Climate Change and Rural Affairs budget is fairly allocated towards the agricultural sector,” he added.

A final vote on the budget is expected in March 2025, but the Welsh government will need an opposition politician to help it pass through the Senedd as it does not have a majority.

It doesn’t yet have that support.

Recent cuts 

If approved, the upturn will compensate for some of the cuts Welsh farmers have seen in funding post-Brexit.

By the end of the current financial year, Wales will have received around a quarter of a billion pounds less for agriculture and rural development than could have been expected had the UK remained within the EU, says the FUW, equating to a loss of around £15,000 per BPS claimant since 2019.

This arose from a shrinking of the Welsh rural affairs budget by £37.5m in the 2023-24 financial year, and a further year-on-year cut of £62m for 2024-25 which, at 13%, was the largest relative reduction of any of the Welsh government’s departmental budgets.

NFU Cymru said the restoration in part of some of these cuts was “positive’’.

Union president Aled Jones said confirmation was now needed from rural affairs minister, Huw Irranca-Davies, of how he plans to spend the money made available to the department, including investment support measures for the farming industry.

“These measures are crucial for the delivery of productivity and environmental improvements on farm,’’ said Mr Jones.