Sustainable Farming Incentive: Small Farms

Lord Colgrain Excerpts

Wednesday 11th March 2026 Lords Chamber

Asked by

[Lord Colgrain]

To ask His Majesty’s Government what is their definition of a small farm in the context of the reformed Sustainable Farming Incentive.

[Lord Colgrain (Con)]

I beg leave to ask the Question standing in my name on the Order Paper and refer to my farming interests in Kent, as set out in the register.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)]

My Lords, the new sustainable farming incentive offer for 2026 builds on the 2024 scheme but is simpler and more streamlined. When applications open in June this year, priority will be given to small farms and those without an existing environmental land management revenue agreement. Small farms are defined as having at least three hectares and no more than 50 hectares of agricultural land.

[Lord Colgrain (Con)]

I thank the Minister for her reply. Given that farm units of the size that she has mentioned are generally viewed as uneconomic and unviable in purely agricultural terms, I ask, if I may, two questions. First, given that the Government used 140 hectares as the size of the average family farm when making calculations for the new inheritance taxes for farms and small businesses, why are they now penalising family farms by allowing only one-third of them by size to qualify for this funding tranche? Secondly, in the context of the Batters report, how does this small SFI tranche help with the two fundamentals that the report highlights—namely, to facilitate increased productivity and the need for greater security for domestic food production?

[Baroness Hayman of Ullock (Lab)]

We believe that it is important to encourage smaller farms and those without existing agreements to come forward to access the grants that are available to make their farms more sustainable. It is a little sweeping to say that they are not economic. All farms are different, and it often depends on how they are managed. As the noble Lord said, there is a second window opening in September to which all farms will be able to apply. We are looking to support all farms in increasing food production. Food productivity is an important part of the Batters review. Much of what we are doing in the new offer and in the farming road map is in response to the Batters review’s recommendations.