Agriculture (Delinked Payments) (Reductions) (England) Regulations 2025

Baroness Coffey Excerpts

Wednesday 30th April 2025 Lords Chamber

[Baroness Coffey (Con)]

My Lords, the Minister knows how much I respect her, and I also respect Daniel Zeichner in the other place. Daniel, in particular, has spent many years in that portfolio, and I am conscious that these may not have been their decisions. That aside, that is the joy of collective responsibility.

The transition that has happened as a result of leaving the European Union was set out under then Secretary of State Michael Gove, who will shortly be coming to this place. I am not pretending otherwise: I was Secretary of State and inherited a plan that was unpopular with a lot of farmers, going from certainty of income to something a bit more uncomfortable. But it was the right thing to do to have a transition, recognising, as has been pointed out by the Minister—and here I disagree with my noble friend who just spoke—that just 10% of landowners were receiving half the funds. It was important to make these changes towards a more positive environmental aspect to our agriculture, recognising a lot of the harms that had been done—not intentionally—without that understanding of what some agricultural practices had started doing to biodiversity right across the country, including polluting rivers.

Back in 2018, when I was a Minister in Defra, I signed the farming rules for water to try to make sure that we began to turn circle, so that we started to see improvements. Indeed, we have seen improvements in pretty much every river across England in the last five years, none of which, however, are necessarily meeting the ecological or chemical standards. By the way, Wales, Scotland and Northern Ireland did not adopt these regulations. Nevertheless, there has been progress: the slurry grants, for example, helped by SFI payments more recently, will continue to bring rewards.

I appreciate that there are many Liberal Democrat Peers here to support their fatal amendment. I am not going to get into the constitutional rights and wrongs of that, but I gently point out to them that when the Agriculture Act was debated in this House, they put forward an amendment to reduce the transition period from seven years to five, so as to accelerate the transition, because they wanted more money to go into the environment a lot quicker. I am really pleased they have had a damascene conversion regarding the importance of how we support farmers, but I wish they had not put forward that suggestion back in 2020, during the design of the very schemes we are discussing today.

During my time in Defra, I was concerned. When I arrived, the first option involved soil, which, by the way, is critical not only to the future prosperity and productivity of farmers and the profitability of farming, but to the prosperity of the planet. It was right that the initial focus of Defra was treating soil well and making that the fundamental cornerstone of bringing about improvements in a variety of ways.

One of the things that concerned me was that, as we started to see the escalator—or perhaps the see-saw, if you like—moving from one to the other, we saw that although many farmers could participate, we needed to offer farmers a lot more as their income from BPS fell and we eventually transitioned to delink so as to get away from the EU rules. We needed to open up the number of options more quickly to allow more farmers to look at how those options could help them achieve the outcomes that we wanted to achieve through the environmental land management scheme.

I can honestly that say a lot of thought went into this. I had been in the department from 2016 to 2019 and when George Eustice was the Agriculture Minister. We started discussions early on about how this would work, and this is where we ended up with the seven-years proposal. Not only that, in the Agriculture Act we included a power to be able to extend beyond seven years. When considering some of the options when I was Secretary of State, I deliberately chose to act against the advice of officials, who wanted to set the taper all the way to the end of the seven years. I was concerned even at that point that it was not clear to the department or to Ministers, and I was afraid that the analytical capabilities of the RPA seemed not to be up to it. I was considering extending the transition period for delinked payments beyond the seven years, to make sure that we were not in a situation where the 10% of landowners and farmers who were getting the money were getting even more of the 50%. We wanted to make sure that farms were still viable. That is why we did not set at a particular time the final few years. It was to give us flexibility, so we could see what was going on and see whether farmers were taking up the options.

As the Minister has accurately reported, we now have more farmers involved in these agricultural environmental schemes than ever before. In the times when the UK moved part 2 of the BPS up to 15%—the maximum allowed—we had even more, and that was a good thing. But it was important that we had that flexibility, which is why I am concerned. Having got farmers to look into this, we put money in to allow them a payment to consult to help them think about how they were going to use their land. We knew that that could not just come from their own pocket. That is why we initially put in a £1,000 payment and then £2,000 in order to access that.

We changed the rules, so that you did not have to have received BPS before. Many farmers around this country were not getting any BPS at all; they were actually doing environmentally friendly things but were not getting substitution income. I choose as an example Suffolk, because that is where I used to represent, where many free-range farmers were not eligible for BPS. We changed the scheme for, for example, the pig industry—the entire pig industry was not eligible. We changed that rule because we recognised that, if we wanted to reach the environmental targets that both Houses had voted on, we needed to make sure that as many farmers and landowners as possible would get involved.

We cannot expect them necessarily to do that for free. There are plenty of rich landowners who, out of the goodness of their heart, might want to do it, but as my noble friend Lord Caithness pointed out, and as I have pointed out in farming debates before, there is sadness in where we are today. I have already seen it: farmers I visited when we were discussing how to make some of these things work are now busy ploughing up the cover crops that they planted which are no longer viable to keep the family business going. That is a huge sadness.

I am conscious that the Minister today will probably share in that sadness. It is a real sense of regret. The Government must take away the fact that, for all the talk of food security, and despite the fact that more food will be produced—as I am sure it will be—that will be at the harm of having a combination of what ELMS was seeking to achieve.

Candidly, there has been a lot of talk about underspends, but I have to say that it is quite pathetic. We always knew that this transition would be a bit like a see-saw—there would probably be a bit of an underspend, though not that much in terms of the percentage of the overall budget—but, as we opened up more options, we knew that more SFI money would be needed. That is why it was carefully managed. I am concerned that we are in this situation today, as has been pointed out, despite assuring farmers that they would get six weeks’ notice of when a scheme was going to close. Ideally, we would move to a rolling option so that it would not close, but I appreciate that this was not the practice of previous years. That was designed, again, to recognise the different seasons and the different demands on farmers. To suddenly shut it was really poor—really shabby. That is why I have advised members of the NFU and farmers locally that they should first complain to Defra and then go to the parliamentary ombudsman, because I have no doubt that this is maladministration.

I am also concerned that, in the Explanatory Memorandum to the SI, the Minister has stated that there was no problem in terms of the ECHR. Under A1P1, the expectation of receiving grants is an asset, and I have no doubt that, if people were to make a legal claim against that, they would certainly get compensation too.

In terms of where to head, there is a real issue for farming. It is not just about the inheritance tax but about the agricultural APR, the BPR and all the things that farmers spend, thinking of the long term; yet all of that is being taken away. I used to think that Labour cared about the countryside, but it does not feel that this is the case. It does not feel like it cares about rural communities, which I am sure will be looking at those Members of Parliament who voted for the SI at the other end of the Corridor.

There is a bit of a trend here. I was concerned to read in Hansard that, when the Commons debated this, the impact assessment statements were not updated because they were done in 2020 with the Agriculture Act. However, the plan was very clear then: it was set out in the Bill that there would be seven years of transition. That was the expectation set by the Government at the time. It is a true matter of regret that no impact assessment was updated.

Many of us will have spoken to farmers. According to the transparency, sadly, the Agriculture Minister did not meet any farmers between October and December 2024, when this change in policy would have been considered. However, as I said, I respect Daniel. He has been a considered shadow Minister and now Minister, but we should not be in a situation where farmers are hitting a wall. The Planning and Infrastructure Bill will be killing off things such as the biodiversity metrics, which my noble friend referred to, and we will see intensification.

For those reasons, I support my party today in expressing regret. I am conscious that Members in the elected House have already made this determination, but they should do that knowing that they need farmers and landowners to produce food and that, without them, we will not achieve the environment and climate targets that have been set. It is for that reason that I support the regret amendment tabled by my noble friend.