The sudden announcement that the doors to the expanded Sustainable Farming Incentive (SFI) offer were to be closed with immediate effect has sent shockwaves rippling through the English countryside.

With almost no single farm payment to rely on, a drying up of capital grants and the recent changes to inheritance tax rules, the outlook for English farmers has not looked so bleak for a very long time.

Before this bombshell news was announced at 6pm on Tuesday 11 March, there had been much discussion between industry representatives and Defra about the delays in SFI payments and the lack of clarity surrounding the £1.05bn budget allocated for the scheme over two years, as well as concerns about the allocation of the total £5bn Defra budget for farmers in England.

With Defra offering little transparency on this subject and Number 11 Downing Street making more and more noise about a fiscal black hole, it perhaps should have come as no surprise that SFI was stopped dead in its tracks.

The question is, what comes next? Defra has committed to revisiting the SFI and working with stakeholders to refine the scheme, with an update is expected in the ‘summer’. However, no specific timeline has been set for when the scheme may reopen to new applicants.

In its defence of the closure, a Defra spokesperson stated that the £1.05bn cap for SFI had been reached, with funds either paid out or committed to existing agreements.

Troubled time

The spokesperson also confirmed that the Government will “reopen a new and improved SFI scheme with more details coming this summer”.

Those in an existing SFI scheme should already be benefiting from payments designed to deliver environmentally and efficiency gaining options on the ground. These payments should also have gone some way to make up the shortfall of the fast diminishing area payment (BPS).

However, there are a huge number of farmers (up to 50% according to NFU figures) who for one reason or another, were not yet entered into an SFI scheme and it is this group who are facing a troubled time ahead. Those coming towards the end of an old Countryside Stewardship or Environmental Stewardship schemes along with upland farms and diehard regen farmers are likely to be hardest hit, where a well designed SFI scheme will have bolstered farm income.

We would urge farmers to be poised at the ready for any future announcement and to make the most of any landscape scale, capital or productivity grants that come along in the near future – it feels like this might be the last chance for direct Governmental support.

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