Defra has outlined a high-level view of its funding from 2026鈥�27 to 2027鈥�28 on delinked payments, ELMs and other funding streams in addition to nature schemes.
Farming and nature recovery has been allocated an average 拢2.7 billion per year which has been committed to from 2026-27 until 2028-29, but within this there will be a 拢100 million cut to farming and countryside programmes.听
The farming and countryside programme funding makes up 拢2.3 billion of the 拢2.7 billion budget. This is down from the 拢2.4 billion per year committed to FCP between 2020/21 to 2024/25.
鈥�Questions still remain about how farmers in England are going to deliver more for consumers with less, as investment in agriculture and nature recovery is combined.鈥�
NFU President Tom Bradshaw
NFU President Tom Bradshaw said that while it was 鈥減ositive鈥� to see further detail from Defra on how the budget outlined in the spending review will be allocated, 鈥渜uestions still remain about how farmers in England are going to deliver more for consumers with less, as investment in agriculture and nature recovery is combined鈥�.
More detail to come on ELMs
On ELMs, funding is set to rise to 拢2 billion by 2028/29 compared to the 拢1.8 billion earmarked in the Autumn 2024 budget. However, while Defra has said this represents a significant increase, the NFU has highlighted the comparison to the 拢800 million spent in 2023/24 on ELMs is misleading, as ELMs was not fully operational at that point, and de-linked payments absorbed a large share of funding.
Defra has confirmed more information on a reformed scheme for ELMs will be published later this summer.听
It has also committed to continue to invest in farmers' profitability, productivity and to strengthen farming businesses, both now and for the future via the existing grants, funding innovation and research through the Farming Innovation Programme, as well as advice and support services.
Delinked payments cuts
Defra also confirmed the delinked payments cuts in 2026 and 2027 (subject to parliamentary process) as follows:
- Apply a 98% reduction to the first 拢30,000 of any delinked payment聽
- Any amount above 拢30,000 will be reduced by 100%
- This results in a maximum payment of only 拢600, a further significant reduction from the 拢7,200 maximum payment available in 2025 following announcements made in the Autumn 2024 budget.听
- The RPA calculates the reductions using the farmer鈥檚 reference amount (based on average of BPS 2020-2022 and not the value of their 2025 payment). The RPA will write out to farmers in due course.
When direct payments were phased out, an assumption within the policy development was that the loss would be offset by farmers getting a proper return from environmental schemes as well an adjustment of land rents where that was a basis of land tenure 鈥� this isn鈥檛 happening.
Many farmers were shocked at the pace of the progressive reductions for the current year. These latest cuts, which will see no farmer receive more than 拢600 in delinked payment, will be seen by many as derisory.
皇家华人is clear that it does not support the progressive reduction of payments in this way. This, in addition to the planned changes to inheritance tax as set out in the Chancellor鈥檚 October Budget, severely risks investment in the future of UK food production.
NFU President Tom Bradshaw responded:聽鈥淭he increase in Defra鈥檚 Environmental Land Management schemes follows the rapid shift away from direct payments and will pay farmers for the public goods they deliver under these schemes. Farmers now urgently need clarity on the Sustainable Farming Incentive, which must be accessible to all farmers, to prevent ongoing cashflow pressures and ease a crisis of confidence.
鈥淐ontinued investment in productivity and innovation is welcome. But to enable farmers to invest confidently in sustainability, the environment and animal health and welfare, we now need clear information on how these funds will be used.
鈥淔armers continue to sit at the heart of delivering the government鈥檚 ambitions, from boosting nature to ensuring food security. But it is also a long-term business and further clarity from Defra must reflect that.鈥�
