The Agricultural Bill 2018

The Agricultural Bill was published on the 12^th September 2018 and it is expected to become law in spring 2019. It is a key part of the Government’s plan for future farming and land management policy. The bill provides a framework for new agricultural policies and transition measures for England, Wales and Northern Ireland.

New financial assistance powers

This section provides the powers to make payments for public goods varying beyond environmental delivery. This will include animal, heritage and landscape protection, supporting public access to the countryside and environmental education. In addition, the bill contains a provision for the funding of improvements in farming productivity, which will replace the current Rural Development Programmes.

Financial support after leaving the EU

The Bill accounts for the transitional phase out Basic Payments post Brexit and introducing ‘delinked’ payments. The process shall include the following:

1. Claim years 2019 and 2020 will continue to use Basic Payments, however simplifications will be made to make it easier to apply for and to administer.
2. Basic Payments shall be phased out completely between 2021 – 2027
3. The payments will be delinked from the requirement to farm the land based on a reference year and the possibility of providing a one-off lump sum instead of annual payments shall be investigated by the Government.
4. The administration of the scheme shall be simplified and greening requirements could be removed.

What this means for farmers and landowners

Anyone who currently receives Basic Payments will continue to do so for 2019 and 2020, but from 2021 payment reductions shall begin. The policy sets out how this will be carried out in the first year, with different rates for different bands and the reductions applying. The bands are set out in the table below. It is not clear how these reductions will be made in later years, before the payments are phased out completely.

Payment Bands	Percentage Reduction
Up to £30,000	5%
£30,000 - £50,000	10%
£50,000 - £150,000	20%
£150,000+	25%

 

The two-year gap before the reductions begin allows time for businesses reviews to be carried out and plans to be made.

Intervention in agricultural markets

This section allows the Government to financially assist via payments, loans or guarantees in the case of extremely adverse market conditions that could seriously harm producers. It does not cover exceptional events such as the weather or disease, unless they result in disrupted markets and damage to producers. The Government could also operate public intervention or private storage aid schemes.

Any intervention cannot last longer than three months, but it can be extended for a further 3 months.

What happens next

The bill will now progress through Parliament and was debated on 10^th October. Various agencies such as the CLA and NFU will be engaging with the process to try to ensure the final bill protects farmers and landowners and the profitability of farming for the future as much as possible.