Sustainable Farming Incentive

Lindsay Hoyle Excerpts

Wednesday 12th March 2025 Commons Chamber

[The Minister for Food Security and Rural Affairs (Daniel Zeichner)]

With your permission, Mr Speaker, I would like to update the House on the sustainable farming incentive.

We stand on the edge of an unprecedented global transition for British farming. From leaving the European Union to the challenges of climate change and geopolitical events, we are asking more of farmers than ever before: to continue to produce the food that feeds the nation and to protect the environment on which our long-term food security depends. We are determined to create the conditions for farm businesses to be profitable and succeed. We are proud to have secured £5 billion for farming over two years: the largest budget for sustainable food production in our country’s history. That is £1.8 billion for customers already in agreements, £1 billion for farmers now in SFI agreements and a further £150 million for farmers in the SFI pilot.

Labour has got that money out of the door and into farmers’ pockets. We have invested it to bring thousands more farmers into environmental land management schemes, which were vastly underspent by the previous Government, to make a record number of capital items available for the coming year to help farmers carry out actions under the SFI and countryside stewardship, with £600 million available for productivity, animal health and welfare innovation, and other measures to support agricultural productivity, as well as 50 landscape recovery projects across the country. We have responded directly to calls from the sector to roll out a new higher-tier scheme, and to increase payment rates so that higher-level stewardship agreement holders—many of them upland farmers—are fairly rewarded for their work.

More than half of all farmers are now in schemes, with 37,000 live SFI agreements and 50,000 farmers in ELM agreements. Under the SFI, 800,000 hectares of arable land are being farmed without insecticides, 300,000 hectares of low-input grassland are managed sustainably, and 75,000 km of hedgerows are being protected and restored, which is a huge success for nature. I thank all farmers involved and reassure them that all existing SFI agreements will be honoured.

Farmers will continue to be paid under the terms of their agreement for its duration. If they entered into a three-year SFI agreement earlier this year, they will be paid until 2028. If they submitted an SFI application but this has not yet started, that will also be honoured. All farmers who took part in the SFI pilot will be able to apply for an agreement.

With the high uptake of the scheme, however, the fact is that it is now fully subscribed. This Government inherited SFI with no spending cap, despite a finite farming budget, and that cannot continue. We will continue to support farmers to transition to more sustainable farming models including through the thousands of existing SFI agreements over the coming years and a revamped SFI offer. But this is an opportunity to improve how we do that under a fair and just farming transition, which supports farms to be profitable businesses in their own right through fairer supply chains, better regulation and greater market access, and directs public funding in a fair and orderly way towards the priorities that we have set out on food, farming and nature. We will be strategic in how we design our schemes, and responsible within the available budget. This is about using public money in a way that supports food production, restores nature and respects farmers as the business people they are.

SFI can and must work better for all farms and for nature, and I will set out the details of the revised SFI offer following the spending review, including when it will open for applications. We will work closely with the sector to design an improved scheme so that they can tell us what works best for their businesses. We will also put in place strong budgetary controls so that SFI is affordable to the public purse. The revised offer will align with our land use framework to better target SFI actions fairly and effectively, focusing on helping less productive land contribute to our priorities for food, farming and nature.

The underlying problem facing the sector, however, is that farmers do not make enough money. The Government are changing that. [Interruption.] Opposition Members may laugh but businesses do need to make money; they might need to know that. We announced a new set of policies at the National Farmers Union conference last month aimed at improving farm profitability, securing our food security, and protecting nature. Through our farming road map, we are creating the conditions for farmers to run profitable businesses that can withstand future challenges.

This decision is about investing in long-term stability. It is about a future where farmers are supported to run profitable businesses, and where public money is used in a better way to better restore nature and to secure long-term food security.

[Mr Speaker]

I call the shadow Secretary of State.

--- Later in debate ---

[Daniel Zeichner]

I thank my hon. Friend for her question. She makes absolutely the right point. We should be reassuring people out there that farmers who are in schemes are absolutely safe and are carrying on as before, but the basic point is that when a scheme is full, it is full.

[Mr Speaker]

I call the Liberal Democrat spokesperson.

[Tim Farron (Westmorland and Lonsdale) (LD)]

I thank the Minister for advance sight of his statement. The closure of the SFI from 6 o’clock last night came without warning or consultation, and it constitutes the breaking of the Government’s word to farmers. Farmers are already losing their basic payment this year, but they are now excluded from the very scheme designed to replace that. Has the Minister not broken his word to farmers and to all who care about nature? Will he clarify how much money he will save from the BPS cuts this year and say that it is not true that SFI is overspent? Is it not true that when the BPS cut is taken into account, more than £400 million of the £2.5 billion farming budget will remain unspent? A bigger budget is pointless if we do not spend it. This money was supposed to reward farmers for nature restoration and sustainable food production. Does this not damage both?

There are 6,100 new entrants to SFI this year, yet only a mere 40 of them are hill farms. Because of the failure of the Conservatives in the previous Administration, the big landowners and the corporates are already comfortably inside the tent, but the farmers who are outside and now locked out without warning are Britain’s poorest farmers in beautiful places, such as mine in the lakes and the dales. As the Tories oversaw a 41% drop in hill farm incomes in just five years, is this not a bitter and unbearable blow for our upland farmers?

This betrayal will outrage everyone who cares for our environment, our upland nature and landscapes and it will outrage everyone who cares about food security and it will outrage everyone who cares about our tourism economy. It will also outrage everyone who clings to that old-fashioned expectation that Governments should keep their word. On Monday, the Secretary of State came to my beautiful constituency to pose for pictures by Windermere. I wonder whether he might come back tomorrow and face up to the farmers who steward the stunning landscapes around our beautiful lakes, and who he has abandoned so shamefully. Will he reopen SFI and honour his promises, or turn his back on the very people who feed us?