Farmers are facing a “cliff edge” as the Labour government refuses to commit to maintaining the agriculture budget for England, the president of the National Farmers’ Union has said.
The issue is one of the first pressures Labour is facing over its tight fiscal rules, along with a rebellion on the party’s refusal to remove the two-child benefit cap.
Conservative MPs have said they plan to challenge the government on its failure to commit to the agricultural budget, which Labour says it will not comment on until after the spending review later this year.
Since the UK left the EU, it is no longer in the European common agricultural policy, which ensured steady payments for farmers directly linked to how much land they managed. Instead, each devolved nation has its own government payments scheme.
The previous government committed to spending £2.4bn a year in England on payments for farmers, mostly linked to environmental improvements made on their land, to replace area-based payments similar to those in the EU scheme. However, this assurance ends at the end of the calendar year.
Farmers will not hear about whether these payments will continue at current rates until the spending review in the autumn, a spokesperson for the Department for Environment, Food and Rural Affairs told the Guardian.
This means they will have just a couple of months to plan their finances for the coming year. Government payments are even more important in years with bad weather, such as the severe floods in 2023-24, because they can partially make up for crop and livestock losses.
Speaking at the NFU summer reception, its president, Tom Bradshaw, said his members were “being kept up at night” by the “cliff edge” that was coming as land-based payments were being phased out without certainty about the wider budget.
He said he was working with the Wildlife Trusts and WWF to pressure the government to keep or increase the budget.
“We know that there’s a lot of other environmental organisations that are also arguing or calling for an increased budget,” he said. “We will work with them and I believe there is a budget, but securing it for the future and in a ringfenced manner, and knowing how much it is, is crucially important.”
The NFU announced in 2019 that the farming sector would reach net zero emissions by 2040. But Bradshaw said this target would in all likelihood not be met because of a “lost five years” under the Conservative government.
“There has never been a coordinated strategic policy in place for the decarbonisation of food production,” he said. “We’ve always been reliant on the government to meet that 2040 target and we have had a lost five years.”
He said reasons for the NFU dropping the target included renewable energy markets not having developed at the speed predicted. Farmers have been blocked from building solar on their land, grid connections have taken years and onshore wind was in effect banned until last week.
Greg Smith, the Tory MP for Mid Buckinghamshire, told the Guardian his party would hold Labour’s feet to the fire on the issue.
He said: “90% of my constituency is farmed, and our manifesto promised to increase the farming budget. Labour’s barely mentioned farming and it’s of note the king’s speech did not either.
“Farming is a long-term business and farmers need to plan ahead so my farming constituents are very concerned that they will not have any certainty on this until the spending review.”
Speaking at the reception, the farming minister, Daniel Zeichner, said he was committed to the payment schemes but he did not commit to a budget. He said: “When people have asked me about whether we’re going to make the ongoing transition to the environmental land management schemes: absolutely.”
He added that “stability in the sector” was a goal of the new government.
