Source · Select Committees · Environment, Food and Rural Affairs Committee
Recommendation 13
13
Paragraph: 79
We share the concerns of many that the existing approach to calculating payments based on...
Conclusion
We share the concerns of many that the existing approach to calculating payments based on “income foregone” will be unattractive to farmers and ineffective for the environment. Payments for environmental actions need to fairly and fully represent Environmental Land Management and the agricultural transition 43 the management costs associated with delivering them. It is also true that agri- environment delivery has in the past been underpinned by BPS payments, and Defra must ensure that payments for new schemes are high enough to account for the loss of this money.
Paragraph Reference:
79
Government Response
Acknowledged
HM Government
Acknowledged
We are designing our new schemes to be attractive to farmers and land managers. This involves a wider range of factors alongside payments, including fairer and more supportive controls, accessible and relevant actions that make sense and have a clear value that farmers can see, clear and trustworthy guidance a straightforward, reliable service with minimal bureaucracy. Payments within the environmental land management schemes will reflect the principles set out in the ‘Payment principles for Environmental Land Management schemes’ document published in June 2021. We recognise that providing the right level of payment to participants will be critical to the success of the programme. We are therefore exploring how best to balance payments to farmers that ensure delivery of environmental objectives, while maximising value for money and respecting our international obligations. We are working alongside stakeholders and users to identify which approach to payments would be most appropriate for each environmental land management scheme. Over 2022, we will set out our approach to making payments under Local Nature Recovery. Within this, we are exploring the role payments can take in targeting the right actions in the right places, and maximising the environmental benefits that can be achieved through the scheme. We will be testing more innovative, market-based mechanisms for setting payment rates such as payment by results and reverse auctions through our environmental land management tests and trials—building on the learning of existing schemes such as the Woodland Carbon Guarantee. We recognise that to secure sufficient participation to deliver the desired environmental benefits, we may need to take a more flexible approach than under existing agri- environment schemes. We are exploring variations we could apply to an ‘income foregone plus costs’ methodology to attract sufficient participation in the scheme. We will assess these variations against criteria including value for money, managing a fixed budget, and WTO Green box compatibility. Evidence and feedback gained through tests and trials and the pilot will be important in informing our approach to payments. We apply what we learn from this across the schemes.