Farming Practices: Sustainable Farming Incentive

My Lords, the sustainable farming incentive is largely aligned with regenerative agriculture. There are actions for cover crops, no-till farming and providing insect-rich habitats. Furthermore, SFI includes actions for precision application of crop nutrients and pesticides.

I thank the Minister for her response. It is good to hear that the Government will move towards increased SFI funding, with a focus on regenerative agricultural practice. However, much of the scientific evidence suggests that adopting these techniques can reduce crop yields in the first three to five years. Can the Minister reassure the House that the SFI agreements are sizeable and have long-term certainty, beyond the current Treasury settlement, so that farmers know that they will be supported through this critical five-year transition period? Without that, I believe there will be very low uptake of the SFIs.

When we brought in the new offer, we wanted to take away the uncertainty as to what was happening with SFIs in the longer term. We have made it clear that we will keep the main SFI offer largely stable from now until the end of this Parliament to provide certainty to farmers that we are going to continue this kind of SFI offer.

My Lords, common land is excluded from both the SFI and the countryside stewardship higher tier. When will the Minister ensure that owners and graziers on common land can apply for SFI and the higher tier? She will be aware that most of these people are in the uplands and are really suffering at this time.

I am very aware of the issue the noble Baroness refers to; we have discussed it in Parliament. The issue is that common land and shared grazing are in principle eligible for both SFI and CSHT—the higher tier—but, for technical reasons, it is not currently possible for common groups to apply for SFI or to enter the new higher-tier grants, as the noble Baroness so rightly said. The RPA is engaging with the different external stakeholders, including the Foundation for Common Land, to discuss what can be done to ensure that they can apply for grants and get the support they need. We are looking to introduce the ability to apply in respect of common land under the stewardship higher tier later this year. We will be trialling applications before we spread it out more widely.

My Lords, does the Minister agree that species-rich grassland is one of the clearest examples of regenerative farming in practice? Why, then, has support for it been removed from SFI 2026? How does that sit with the Government’s commitment to regenerative agriculture?

We have tried to bring SFI into new areas because it is really important that smaller farms and different types of farms have the opportunity to get the grants to do regenerative farming. Alongside that, we are looking at other ways to support the kind of things the noble Baroness is talking about. It is also important to remember that, when there is a grant for something, it does not mean that is the only thing you can get a grant or support for. I would encourage landowners to look broadly at what we have to offer.

My Lords, will the Government consider looking back at the criteria on which the ELMS payments are made? If you farm regeneratively, you not only improve the soil by cover crops—growing beans and legumes—mob grazing and not tilling, but you improve every single thing in the ELMS. It would be a way of transferring money to farmers, who get far too little out of the food system, and of encouraging them to move their farming practices over ASAP.

We are looking at the uptake of the current round of SFI, which has been very encouraging. We recently said that 50% of the SFI budget has been allocated, and we will be reviewing that. It is also important to look at the changes that this is encouraging, because much of it was designed to make the biggest difference. We work very closely with farmers who do regenerative farming, such as Martin Lines. It is important that we target what we see as making the biggest difference the quickest.

My Lords, the introduction of sustainable farming incentives under ELMS remains something we on these Benches are particularly proud of. They were intended to be part of a transitional scheme preparing farmers for greater private finance involvement in restoring nature through sustainable farming practices. The 25-year farming road map contained aspirations on this but very little detail, so could the Minister give us some real-world evidence of private sector finance creating incentives for sustainable farming?

It is important to assure noble Lords that, just because something is not specifically in the farming road map, that does not mean that it will not be part of this long-term plan. The whole point of the farming road map is that it is not specific and dialled-down—it is a 25-year look ahead. On the basis that it is a long look ahead, you would not expect all the detail and information to be in it, because that will be developed as we move forward, and things will change a lot over 25 years.

My Lords, is it not the case that, for too long, rich farmers have been getting far too much subsidy? Is it not good that this Government are introducing a system that will help smaller farmers and hill farmers?

The new SFI, which we announced fairly recently and which runs through to September, was very much aimed at smaller farms and those that do not already have an agreement. The fact that 50% has been allocated already shows that that was a very popular decision.

What are the Government doing to encourage food production?

Our encouragement of all sorts of farms that did not already have grants and support demonstrates that we are keen to look at food production. We also have a farming innovation programme that supports agrotechnology for farmers, which can help with food production as well. The whole picture is about supporting food production, because, as we have said, we believe that food security is national security, and we take that very seriously.

My Lords, I declare my farming interests. One should not be provoked by comments, but it is important that we feed the nation, and I am worried about this concern that, if you are a medium or large farmer, somehow you are the enemy. We need all farmers to ensure that we are well fed and have national security through that, as well as enhancing our environment. It is important that farmers have clarity and certainty; the Minister has touched on that, but farmers need far more of it.

It is absolutely right that farmers need clarity and certainty, which is why we have brought in the 25-year farming road map. With regard to larger farmers, that is also why, from September, the SFI will be open to all farms. We are trying to encourage farms that had not previously taken part to come forward and be supported by the Government.

We certainly do not see larger farmers as the enemy, but we are aware that small farms have particular problems in accessing these grants. So I kindly ask the Minister: what further measures are the Government taking to make sure that smaller farmers have the skills and the ability to access these grants?

That is an important question. We do not see large farms as the enemy; they are incredibly important if we are going to meet our food security targets. I really understand what the noble Earl is saying, because I have a small farm. I did not apply for the new grants a couple of years ago because it was too complicated. My farm was not of a size that would employ a land agent to help with the application. So we have tried to work with the RPA to simplify the process and offer targeted support to smaller farms.

My Lords, many of us on these Benches are supportive of British farming and congratulate our farmers on their excellent work in food production. But I have a question for my noble friend the Minister. It is entirely possible in the current system that multiple SFIs will be applied to one farm. Can she say more about the process of moving to one SFI for the farmed area of a farm without losing out on financial support?

I am not sure how many SFIs one farm would ever get; it depends on what it is looking to support, for example. There are different things—there is catchment-sensitive farming and different tiers—and each of those will be looked at on its own merits so that it achieves the outcomes we want.