My Lords, I declare my farming interest as set out in the register. This instrument is part of our agricultural transition in England away from the common agricultural policy towards our environmental land management schemes. It introduces delinked payments in 2024, which are a simpler type of payment, in place of direct payments under the existing basic payment scheme in England.
Unlike the basic payment scheme, delinked payments will not be based on the amount of land someone has. Instead, they will be based on the basic payment scheme payments, made in a reference period. This will reduce administrative burdens as we phase out the payments by the end of 2027. There will be no need for an annual application form, as the Rural Payments Agency will already hold the data needed to check eligibility for the payments. This will mean that farmers have to spend less time filling in forms compared to the current scheme.
Delinked payments will be made to those farmers who claimed and were eligible under the basic payment scheme in England in 2023. The payments will be based on a reference amount. This will be the average payment made to the business for the 2020-22 basic payment scheme. To provide flexibility for farmers, we are allowing reference amounts to be transferred between businesses. They can do this during a transfer window from February to May next year.
This will particularly help businesses that have changed their structure since the start of the reference period. For example, if two or more businesses have merged, the reference amount could be transferred from the original businesses to the current business. Special rules apply to inheritance cases. The Government intend to reduce the payments each year by applying percentage reductions to gradually phase the payments out. This will continue to free up money to be invested in our new farming schemes. The reduction percentages will be set in future secondary legislation, which will be debated by the House. We intend to make the payments in two instalments each year to help cash flow. Ending the basic payment scheme also means that the associated cross-compliance system no longer applies; this is a system that our farmers have widely disliked as being over-bureaucratic.
I will move on to the regret amendment. When cross-compliance ends, farm standards will be maintained through existing and ongoing domestic regulations that protect the environment, the public, animal and plant health and animal welfare. These regulations will be enforced in a fair, consistent and proportionate way by our existing regulatory authorities. The rules within cross-compliance that are not in underlying domestic legislation will have cover through existing and forthcoming guidance, regulation or incentives. We will deliver a fair, clear and effective system to regulate agriculture. Defra is working with regulators to implement a more preventive, advice-led approach to monitoring and enforcement.
The introduction of delinked payments is an important step in our transition to payments that deliver better environmental outcomes. For example, we have used the money freed from direct payments to establish the slurry infrastructure grant to help livestock farmers tackle pollution from slurry. This includes committing to spend more than £200 million in ongoing grant support for equipment and infrastructure. We are also funding our expanded sustainable farming incentive, which rewards farmers for practices that help produce food sustainably and protect the environment. This includes funding for grass margins for protecting our rivers, for legume fallows to improve soil health and for grassland without fertiliser inputs. We continue to fund our successful Countryside Stewardship scheme and our landscape recovery scheme, which is already funding the restoration of more than 400 miles of rivers.
In conclusion, by introducing delinked payments, this instrument enables us to pay former basic payment scheme recipients for the rest of the agricultural transition but without the bureaucracy associated with the current scheme. It does not mean an end of protections for the environment, animals and plants. Our agricultural reforms are about delivering better outcomes, so that the countryside and wildlife that we all so value can be protected for future generations. I beg to move.
Amendment to the Motion