Lodders’ Agricultural Law expert, James Spreckley, explains the evolution of the Environmental Land Management Scheme, and the coming changes for the agriculture sector.
Just one element of the many changes facing the agricultural sector, but a key one to many, is the move from the basic payment scheme support regime (BPS) linked to productive land ownership, to a system by which landowners can commit to deliver ‘public goods’ in return for public money. This will be under the terms of Environmental Land Management Scheme, or ‘ELMS’.
The concept behind these changes ties in closely to the government’s 25 Year Environmental Plan, with its focus on clean water and air, adaption to climate change, and creating thriving plants and wildlife.
New ELMS system
This will be a wholly new and optional system, by which landowners can choose to enter these schemes. Using their land for the delivery of these public goods has been referred to by Michael Gove as an ‘additional crop’. This reflects the opportunity to generate an income through the ‘cultivation’ of these ‘goods’, which may be as wide-ranging as carbon sequestration to recreation and cultural heritage.
At present, the Department for Environment, Food and Rural Affairs (Defra) is working with a number of organisations and farmers across the country, to trial how ELMS might work operationally, rather than thinking about what the ‘public goods’ might be. Defra is currently looking into a tiered scheme design, packages of options, how the funding system might work, and how the outcomes of the scheme might be assessed with payment based on results.
There are a lot of questions still to be answered, such as:
- Will participation of landowners in an ELMS prevent their engagement in conservation covenants, as well as potential private sector income from developers who need to provide bio-diversity gain when developing land?
- How will the diverse range of public goods be priced to make their delivery attractive and profitable, yet achieving value for money?
Head of the Agricultural Law team at Lodders, James Spreckley, recently attended an event at which Defra indicated that they were working towards a lighter touch approach under ELMS, when compared to some of the prescriptive elements of the current agri-environmental schemes.
“What was interesting is that Defra seem to recognise that local circumstances and also the different individual farming types are going to be relevant to the delivery of meaningful outcomes, rather than a more blanketed nationwide approach that has been prevalent under the current schemes,” says James. “There seems to be a greater emphasis on working collaboratively, and on sharing best practice”.
Those public goods or ‘natural capital’ will be wide-ranging, covering the delivery of new outcomes, but also maintaining current ecosystems. New mapping software is being developed to help identify opportunities for landowners, either alone or working in clusters, and to evidence the deliverables under the schemes.
End of BPS support
“Farmers must really recognise that the end of the current support mechanism is coming, like it or not, and coming quite soon. They should really engage with the principles of ELMS, taking every opportunity to ensure that the system that ultimately is issued, is as workable and positive for their businesses as possible.”
Trials are ongoing and pilots will be run from 2021 until 2024 from when ELMS will be rolled out.
The meeting held at the Royal Agricultural University, Cirencester, was attended by farmers and other stakeholders, and it was clear that there is a lot of concern about how farming businesses will respond to the loss of the BPS support, and the extent to which ELMS can fill that gap, particularly since those businesses want to focus on the food production which is at their heart.
“This is a time of big change for the sector, with Brexit and new trading regimes uncertain, pressures from climate change and changing social patterns are alongside this removal of direct support”, James continues, “however, farmers should be reassured that there are a number of bodies working tirelessly to coordinate the responses on behalf of farmers and to represent their views and concerns to Defra, including organisations like the NFU, Farming And Wildlife Advisory Group, Gloucestershire Wildlife Trust and the Cotswold AONB.”
“The ending of the current support regime in 2027 will leave many businesses with a gap in their balance sheets, and ELMS may be one way of looking to fill this, alongside efficiency drives, diversification, and other funding sources. Whilst there is a long way to go in developing ELMS, this means there is currently an opportunity to help steer the way these develop, if people engage with the process, helping to secure a system that is as positive for the sector as we can hope.”