The Sustainable Farming Incentive (SFI) should have been up and running to deliver payments by December, but critical delays in the roll-out of the new scheme mean most farmers are unable to access it.
Crucially, this coincides with major reductions in payments under the old scheme which SFI was meant to replace, leaving farmers facing a double whammy in the run-up to Christmas.
NFU President Minette Batters said: "We now know that farmers will not be paid this year, despite assurances that they would be.
"The old scheme goes, the new one’s not ready, and farm businesses are caught in the middle. That’s not fair and we are calling on ministers to recognise that and make it right.”
NFU President Minette Batters
"With farm input costs through the roof and interest rates soaring, this leaves farmers in a perilous place. The old scheme goes, the new one’s not ready, and farm businesses are caught in the middle. That’s not fair and we are calling on ministers to recognise that and make it right."
Mrs Batters added: "It’s Back British Farming Day next week; a celebration of farming and growing, of great food, of our countryside and of people who make a huge contribution to the UK economy. It would be great if government could have some good news on this for farmers then."
The problems with SFI do not only affect farmers. Government has legislated for environmental targets through this new scheme – called "public money for public goods" – and farmers have embraced that concept. With the scheme delayed, a lot of on-farm environmental work it is designed to pay for cannot begin.
Therefore, the NFU is calling on ministers to halt any further reduction in existing farm payments – which is due to fall by £720 million this year alone – until delivery problems with SFI are resolved.
Mrs Batters said: "All we’re asking for is government to bridge the gap it has created by taking away one set of payments, but not delivering access to their replacements on time."
Ministers had committed that SFI 2023 would be open in August, with payments coming in December. But it will now only be partially open and not until mid-September. It takes some months between a farmer being accepted on to the scheme and payment being made.
Farmers were able to register "an expression of interest" on 30 August, with a handful then expecting "an invitation to apply" meaning the scheme was "technically" open, but the reality is very different.
Consequently, payments farmers were relying on will not come this year and will come to only a handful of farmers in the early part of 2024. By comparison, the old EU farm payments scheme, known as BPS, had 83,000 claimants.
"Government needs to pause BPS reductions until it can fairly deliver their replacements, otherwise it is farming businesses and farming families which are left bearing the cost."
NFU Vice President David Exwood
The false start for SFI 2023 comes as another key scheme also designed to replace EU payments, called Countryside Stewardship, has also run in to problems.
NFU Vice President David Exwood said: "Paying farmers this year was one of the government’s own key tests for delivery of the scheme.
"With the scale of the roll out of SFI 23 still unclear and with many farmers still not sure what they need to do to apply, the current situation needs to be resolved quickly."
Mr Exwood added: "Government needs to pause BPS reductions until it can fairly deliver their replacements, otherwise it is farming businesses and farming families which are left bearing the cost."