With permission, Mr Speaker, I would like to make a statement on the Government’s agricultural transition plan, published today.
The Agriculture Bill received Royal Assent on 11 November. The Agriculture Act 2020 sets out powers to reward farmers and land managers who protect our environment, improve animal welfare and produce high-quality food in a more sustainable way. These powers will also help farmers to stay competitive, with measures to increase productivity and invest in new technology. We will also improve transparency in the supply chain to help food producers strengthen their position in the market and seek a fairer return for the food they produce.
Today, we are publishing further details of our approach to exercising the powers under the Agriculture Act over the next seven years. We will remove arbitrary area-based subsidies on land ownership or tenure and replace them with new payments and new incentives to reward farmers for farming more sustainably, creating space for nature on their land, enhancing animal welfare and delivering the other objectives set out in the Agriculture Act.
The central plank of our future policy will be made up of the three components of environmental land management. The sustainable farming incentive will pay farmers for actions that they take to manage their land in an environmentally sustainable way. This could include schemes encouraging catchment-sensitive farming, integrated pest management and sensitive hedgerow management. Local nature recovery will pay farmers for actions that support local nature recovery, creating space for nature and habitats on farm and encouraging co-operation between farmers. Finally, the landscape recovery component will support the delivery of landscape-scale projects to deliver ecosystem recovery through longer-term land use change. This will help us meet our targets to plant 30,000 hectares of woodland a year by 2025, create and restore peatland, protect 30% of UK land by 2030 and reach net zero by 2050.
We know that this policy marks a significant change. I am also very conscious of the fact that many farm enterprises are dependent on the area-based subsidy payments to generate a profit, and that without them, some might judge they would not be profitable, so we have created a seven-year transition period. We want this to be an evolution, not an overnight revolution. That means making year-on-year reductions to the legacy direct payments scheme and simultaneously making year-on-year increases to the money available to support the replacement schemes.
Between 2021 and 2024, we will help farmers prepare to take part in our environmental land management offer. This will include expanding the existing countryside stewardship scheme and opening the new sustainable farming incentive to every farmer from 2022 onwards.
We recognise that there is a problem with poor profitability in agriculture. The premise behind our new policy is to tackle the causes of that poor profitability rather than simply masking it with a subsidy payment. Our new financial incentives for sustainable farming and nature recovery will be set at a rate to incentivise
widespread participation and give consideration to natural capital principles. So in some areas they will go beyond the “income forgone” methodology of the past.
We will also make a significant number of grants available to support farmers in reducing their costs and improving their profitability, to help those who want to retire or leave the industry to do so with dignity, and to create opportunities and support for new entrants coming into the industry.
The dysfunctional, top-down rules and draconian penalties that were a feature of the EU era will be removed or reformed. The binary divide between advice and enforcement will also be broken down. Instead, there will be a modern approach to regulation, with more holistic assessments of regulatory compliance and greater emphasis on advice and improvement so that farmers and regulators work together to improve standards.
By 2027, we want to see a reformed agricultural sector. We want farmers to manage their business in a way that delivers profitable food production and the recovery of nature, fusing the best modern technology available today with the rediscovery of the traditional art of good farm husbandry. Our plan delivers those objectives, and I commend the statement to the House.
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