European Structural and Investment Funds and the European Agricultural Guarantee Fund

Debate between Baroness Hayman of Ullock and Baroness Penn

Tuesday 21st March 2023 Lords Chamber

[Baroness Penn (Con)]

My Lords, I am sure that Defra will want to support the work of all farmers in our economy. My noble friend referred to two different categories of farmer: I know that my noble friend Lady Rock did an excellent review into tenant farmers, and a number of her recommendations have been taken forward. As Defra develops its programmes for the sustainable farming incentive and other replacements for EU funds, it will want to take into account the needs of different farmers across the UK.

[Baroness Hayman of Ullock (Lab)]

My Lords, the Government made a very simple promise to the nations and regions of the UK, as well as to farmers: European funding would be matched pound for pound, and the mechanisms used to allocate funds would be simpler and fairer. Several years on, we are still waiting for the shared prosperity fund, environmental land management schemes and the UK Infrastructure Bank to get fully up and running and to hit the targets they have been set. How have the Government managed to get this so badly wrong? Why is progress so slow? Does she acknowledge that this is a difficult time for farmers and that the Government really need to crack on with it?

[Baroness Penn (Con)]

My Lords, as I have explained to the House, as European funding tails away, UK funding ramps up. For example, the shared prosperity fund will reach £1.5 billion a year by the end of the spending review period. For each of the sectors that the noble Baroness mentioned, we have provided clarity around the funding available for the full three years of the spending review and the mechanisms by which it will be distributed. I know that my colleagues in Defra continue to work hard with farmers to ensure the successful rollout of the replacement schemes.

Farmers and Landowners: Tax Consequences

Debate between Baroness Hayman of Ullock and Baroness Penn

Monday 28th November 2022 Lords Chamber

[Baroness Penn (Con)]

Part of what the noble Baroness alighted on reflects our approach: as we pilot and iterate these schemes, we will learn and look at their implications for taxes. How they are designed might have different impacts, so we cannot prejudge that. I reassure noble Lords that tax rules should not have a bearing on many environmental activities under the ELM schemes, such as improving soil health. Many farmers already undertake these activities or have changed their land use within the tax rules currently in place.

[Baroness Hayman of Ullock (Lab)]

My Lords, I listened carefully to the Minister’s responses. There are a lot of doubts among farmers about what ELMS will actually mean, and there is too much uncertainty to allow them to plan properly for the future. Does the Minister properly understand why some parties are just not comfortable about entering into a scheme for which the tax implications are unclear, and which might not even exist in a few years’ time? Farmers need clear advice today, so when will the Government be able to provide that clarity?

[Baroness Penn (Con)]

As I said, many of the tax rules should not have a bearing on many of the environmental activities under ELMS. We already have several schemes under way, with a high take-up among farmers. But we understand that there could be broader implications, particularly for the landscape recovery scheme, and we are carefully looking at this. The 22 initial projects are receiving funding through that scheme, and people have felt able to sign up to them under the existing tax rules and systems. But we will look at those projects and implications as part of our design.