Question to the Department for Environment, Food and Rural Affairs:

To ask the Secretary of State for Environment, Food and Rural Affairs, what steps he is taking with Cabinet colleagues to provide additional support for (a) energy and (b) inflationary costs for the agriculture sector.

The Energy Bills Discount Scheme provides all eligible businesses and other non-domestic energy users with a baseline discount on high energy bills for 12 months from April 2023 until 31 March 2024. A higher level of support is provided to some Energy and Trade Intensive Industries that are particularly exposed to energy cost increases due to their energy and trade intensity and are therefore less able to pass these costs through to their customers due to international competition.

Tackling inflation is one of this Government’s priorities. While inflation has more than halved, it remains a challenge, which is why we continue to monitor all key agricultural commodities and work with the food industry to address the challenges they face. The UK Agriculture Market Monitoring Group monitors UK agricultural markets including price, supply, inputs, trade, and recent developments.

The Government is supporting farmers through a range of measures. In recognition of the challenges faced with inflation and rising input costs, we are updating prices in our environmental land management schemes with an average 10% uplift. We are making the Sustainable Farming Incentive (SFI) simpler, with more choice about what farmers can do and more actions made available, to better reflect the full spectrum of farming interests. What is more, 50 new actions are being added to our environmental land management schemes, many of which support food production, making it easier for the Government’s support to fit into farmers’ business plans. Specific actions in the SFI, such as different cropping systems, better plant management methods and other Nutrient Management and Integrated Pest Management actions, will support farmers in improving soil health, reducing their reliance on costly inputs.

We are also keen to support farmers through technology to help them lower their costs. More grants will be launched this year to help farmers grow more, sell more and make their businesses more sustainable and resilient for the future. We will also look at ways to make grants and schemes even easier to access, including the potential to streamline the application process for schemes. Farmers can now apply for SFI and the Countryside Stewardship Mid-Tier through one single application, meaning they will have the same actions and get the same support with less paperwork.

Full expensing, which was made permanent at Autumn Statement 2023, allows companies to claim 100% capital allowances on qualifying plant and machinery investments (for example, high tech agricultural equipment) in the year the expenditure is incurred. The Government announced at Spring Budget 2024 that we will seek to extend full expensing to assets for leasing when fiscal conditions allow and will publish draft legislation shortly.

We are continuing to keep this all under review to make sure it works for and rewards all farms in all parts of the country.