SFI27: Government Scraps First-Come, First-Served Approach

The UK Government will abandon the first-come, first-served approach to allocating Sustainable Farming Incentive (SFI) agreements in 2027, as the National Farmers Union (NFU) calls for more than £1 billion in funding to meet expected demand.

Defra Farming Minister Stephen Morgan confirmed that the Government is is considering various methods for next year instead of the first come, first served approach, reports Farmers Guardian. 

In addition, Minister Morgan has committed to bringing forward SFI27 as early as possible in the year, and revealed that Defra is consulting with the NFU and industry stakeholders to design a fairer, more sustainable funding distribution method.

The announcement follows concerns over access to SFI26, with strong demand from farmers leading to the funds rapidly running out within a short window, and uncertainty around the allocation process.

The NFU has welcomed the prospect of an earlier rollout but said in a press release that a budget of more than £1 billion will be needed to maintain environmental delivery and meet demand from an estimated 48,000 eligible farmers and growers who are ambitious to “deliver for the environment”.

Its analysis identifies around £960 million in funding that is due to be freed up from expired or expiring agri-environment agreements, which the NFU said it wants Defra to reinvest in SFI27.

NFU said it estimated that £520 million was needed to meet expected demand for SFI26, compared with the £310 million budget provided by Defra.

NFU vice-president Robyn Munt pointed out farmers had demonstrated strong appetite for environmental schemes and must be given the certainty to continue investing in environmental improvements alongside food production. 

“Farmers have shown in their droves that they want to take part in agri-environment schemes,” Munt said. “The experience of SFI26 left no doubt about the strength of that demand.

“As existing agri-environment schemes come to an end and funding is freed up, Defra must honour its side of the partnership with farmers by reinvesting that money in SFI27 and ensuring its budget matches demand,” she added.

NFU’s Key Asks For 2027

The NFU is calling on Defra to open SFI27 in early 2027, with agreements starting from 1 April. 

It also wants farmers with existing agreements due to expire to be prioritised to prevent breaks in environmental work.

Other key asks include allocating funding on a per-hectare basis to give as many farmers as possible access to the schemes, provided payment rates remain financially viable, and to properly reward farmers for the work involved.

NFU also wants urgently addressed the lack of access for common land to SFI and Countryside Stewardship Higher Tier.

In addition, the body is calling for the publication of a clear Environmental Land Management (ELMs) strategy for the remainder of the Parliament.

NFU said this should include scheme opening dates and transparent budget information to help farm businesses plan ahead.

These key asks have been informed by NFU member feedback through two SFI surveys on SFI26 experiences and the approach to application windows.

Long-term certainty

The NFU’s demands come as new OECD figures show UK agricultural support amounted to just 0.2% of GDP between 2023 and 2025, around half the OECD average.

The OECD has also highlighted the need for stable, long-term support schemes, warning that uncertainty over environmental payments and scheme implementation makes it harder for farmers to plan and invest.

Predictable support will be important for fresh produce growers to balance food production with investment in soil health, water management ,and environmental improvements.

NFU’s Munt said stable agricultural policy was essential to strengthening domestic food resilience and helping farm businesses to plan long-term, withstand global shocks, and produce the nation’s food while continuing to deliver for the environment.

“A properly funded SFI27 within a fully functioning environmental scheme offer, backed by a clear long-term plan, is central to providing that certainty and building a secure, resilient food system,” she said.

“British farmers are ready to play their part. Defra must now give them the tools and confidence to do so.”

With the Government now confirming a change to the allocation process, attention turns to Defra to set out the scheme’s timetable, eligibility criteria, and budget.