Farm policy – big changes beyond 2020

While the Brexit outcome will have economic implications, it is unlikely to alter farm support in 2020, says Andersons research consultant Caroline Ingamells.

Defra and devolved administrations have all stated the Basic Payment Scheme (BPS) will continue next year and the delays to Brexit mean any proposed “simplification” of the 2020 scheme (such as removing the three-crop rule) is now very unlikely.

“It seems all rules, including ‘greening’, application processes, timings, and forms will remain unchanged, whether there is a deal or no-deal outcome,” says Ms Ingamells.

If a deal is reached, transition period rules require the UK to comply with existing EU legislation until 31 December 2020.

Although a clause states the BPS shall not apply in the UK for the 2020 claim year, Defra and the devolved administrations have prepared domestic legislation under the Withdrawal Act to ensure support payments continue. This can also be used under a no-deal.

While all rules and processes will remain unchanged until Defra and the devolved administrations introduce new agriculture policies, the mechanism for converting the value of BPS payments once the UK leaves the EU is unclear.

There may be a one-off re-nationalisation, permanently converting all entitlements to a Sterling basis. It is unclear what €/£ exchange rate might be used, but the September average, used previously, may not apply.

De-linking English direct payments from production and introducing a lump sum payment option were key proposals in the Agriculture Bill, which Defra plans to consult on this year.

The Bill also proposes phasing out direct payments in England over a seven-year transition period to 2028, and introducing the new Environmental Land Management Scheme, the design of which Defra is still working on.

Even if the Agriculture Bill is passed, it does not enshrine in law the current plans for future support. Proposals could change under a different government or Minister.

The Countryside Stewardship scheme remains open to applications for now and will continue in the first few years of the transition period, so farmers thinking about entering should not be put off.

Scotland and Wales have consulted separately on future farm policy.

Source: Farmers Weekly