Recommendations & Conclusions
15 items
3
Recommendation
Thirty-First Report - Environmental Lan…
Not Addressed
We are not convinced that the Department sufficiently understands how its environmental and productivity ambitions will impact the food and farming sector over the next decade. Farmers will be required to free up land currently used for food production to produce environmental benefits, for example converting farmland to forestry. This …
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We are not convinced that the Department sufficiently understands how its environmental and productivity ambitions will impact the food and farming sector over the next decade. Farmers will be required to free up land currently used for food production to produce environmental benefits, for example converting farmland to forestry. This may result in an increase in food imports and possibly the 6 Environmental Land Management Scheme price of food into the UK, potentially exporting the UK’s environmental impacts through food being produced in other countries where environmental standards are lower. The Department asserts that environmental benefits can be delivered alongside improvements in farm productivity, and that these improvements will mean that, despite taking land out of production to deliver environmental benefits, farmers can produce more food from the remaining land. The Department also points to productivity improvements as helping to offset farmers’ loss of direct payments but has not presented evidence to support this. Smaller farms and tenant farmers are particularly exposed as they are more reliant on direct payments, which may lead to some going out of business resulting in larger agricultural holding sizes. Recommendation: The Department should urgently explain to the Committee, showing its forecasts both for changes in land use and resulting changes in payments to farmers, how it expects its farming programmes to affect food production and farm productivity in England and report annually to Parliament on the level of food price inflation together with any changes to the proportion of the food we consume that is produced in the UK, which was 53% in 2018.1
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Government response AI summary
The government's response discusses a general PAC conclusion about civil service skills shortages, which does not address the specific recommendation about farming programmes' impact on food production and prices.
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HM Treasury
4
Recommendation
Thirty-First Report - Environmental Lan…
Not Addressed
Despite committing to delaying the early stages of SFI if either the Department or farmers were not ready, the Department has not specified what would trigger such a delay. Opinion within the farming sector is divided over whether the Department’s timetable is realistic or whether delaying the start of roll-out …
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Despite committing to delaying the early stages of SFI if either the Department or farmers were not ready, the Department has not specified what would trigger such a delay. Opinion within the farming sector is divided over whether the Department’s timetable is realistic or whether delaying the start of roll-out of the programme from 2022 is desirable. Some believe a delay is necessary to ensure that the scheme delivers for farmers and the environment and that farmers have the time they need to plan their businesses. The Tenant Farmers Association reminded us that farming requires long-term business planning, with crop rotations and breeding programmes put together over many years. But others highlight that progress to date has already been too slow, and that the right time to delay was 12 months ago. The Department acknowledges that there are delivery risks in the early stages and that it has yet to develop detailed delivery plans beyond March 2022. The Department has committed to making the first payments by Christmas 2022, and to not implementing any system changes that may put this timetable at risk. It asserts that, while there are risks to the delivery timetable that it needs to manage, it is on track and there is currently no need to delay. It told us it carries out reviews to identify any ‘red flags’ that may indicate the need for a delay due to the Department not being in a position to deliver the system, or farmers not being ready, but has not specified what these red flags are or the circumstances that would lead to a delay. Announcing a delay at short notice could be very damaging to farmers’ confidence in the scheme. Recommendation: In line with its Treasury Minute response, the Department should write to us by the end of February 2022 to confirm how it is assuring its own and farmers’ readiness at each stage of the Programme, and specify what would trigger a delay and when, allowing sufficient lead time to allow farmers to plan for a delayed launch. In
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Government response AI summary
The government's response discusses a general PAC conclusion about tracking benefits and costs, which does not address the specific recommendation about farmer readiness and delay triggers.
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HM Treasury
5
Recommendation
Thirty-First Report - Environmental Lan…
Not Addressed
The Department has not yet done enough to gain farmers’ trust in its ability to successfully deliver the programme. Farmers’ confidence in the Department was severely damaged by a poor history of delivery under previous agricultural subsidy schemes, and the situation has not been helped by the very slow release …
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The Department has not yet done enough to gain farmers’ trust in its ability to successfully deliver the programme. Farmers’ confidence in the Department was severely damaged by a poor history of delivery under previous agricultural subsidy schemes, and the situation has not been helped by the very slow release of information relating to the new schemes: In December 2021, since our evidence session, the Department has published further information on how the Sustainable Farming Incentive will work in 2022, including payment rates for the first phase. However, farmers still lack detailed information on what Defra has planned for 2023 and 2024. The Department’s last-minute approach to providing information to farmers severely undermines their ability to plan for the long term to make sure their businesses are sustainable. Arrangements for the upcoming pilot were originally planned to be released a month and a half ahead of inviting expressions of interest, but were released with just two weeks’ notice. We are particularly concerned that the lack of information on what would be available to encourage young farmers into the industry means that young farmers will be less able to enter the industry. The Department admits its confidence in the scheme looks like blind optimism without the details of what it has planned, and has committed to providing, in Spring 2022, this detail for the Scheme’s roll-out in 2023 and 2024. In October 2020, the Department reported that only 30% of farmers had all or most of the information they needed to inform business planning and, although this figure had improved to 40% by April 2021, it is still alarmingly low. A separate survey carried out by the RPA from January to March 2021 found that only 4% of respondents were ‘very prepared’ for upcoming changes in farming and 37% ‘not at all prepared’. Worryingly, 41% of respondents to that survey said they did not know what SFI was. The Department released additional information in June 2021 whi
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Government response AI summary
The government's response did not address the committee's conclusion regarding the Department's failure to gain farmers' trust due to slow information release, instead responding to an unrelated point about efficiency drives.
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HM Treasury
6
Recommendation
Thirty-First Report - Environmental Lan…
Not Addressed
The Department is not doing enough to support farmers through the transition to the new schemes and alleviate any anxiety its plans are causing. The removal of direct payments would have reduced the average net profit of farms in England by 53% over the last three years to only £22,800. …
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The Department is not doing enough to support farmers through the transition to the new schemes and alleviate any anxiety its plans are causing. The removal of direct payments would have reduced the average net profit of farms in England by 53% over the last three years to only £22,800. Without direct payments, over a third of farms would have made a loss and so be unsustainable as businesses if nothing else changed, such as income from new schemes or rent reductions. The Department asserts that farmers will be able to offset the loss of income from direct payments through improvements in productivity, alternative income streams and support from its schemes. The Department recognises that the changes it is introducing is causing farmers anxiety. The mental health of farmers is one of the biggest challenges currently facing the sector. While the Department works with farming charities and is introducing the Farming Resilience Fund, the focus of this is on providing business support and advice to handle changes, rather than directly 8 Environmental Land Management Scheme supporting the mental health of farmers. The Rural Payments Agency, which is responsible for administering payments to farmers, has committed to developing a ‘here to help’ relationship with farmers, but this could be hindered by ongoing trust issues. Recommendation: The Department should identify what further support is needed to help farmers during the transition, including where farmers will face significant business challenges in the short term. The Department should particularly set out what it will do to support farmer’s well-being through the transition.
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Government response AI summary
The government's response did not address the recommendation to identify further support for farmers during the transition or support for their well-being, instead responding to an unrelated point about departmental capacity during emergencies.
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HM Treasury
1
Conclusion
Thirty-First Report - Environmental Lan…
Not Addressed
On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department for Environment, Food & Rural Affairs (the Department) and the Rural Payments Agency.2 We also took evidence from the National Farmers’ Union, the Tenant Farmers Association, the Royal Society for the Protection …
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On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department for Environment, Food & Rural Affairs (the Department) and the Rural Payments Agency.2 We also took evidence from the National Farmers’ Union, the Tenant Farmers Association, the Royal Society for the Protection of Birds, the Confederation of Forest Industries, and the University of Kent.
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Government response AI summary
The government's response did not address the committee's introductory statement about evidence collection, instead responding to an unrelated point about efficiency and cost shunting.
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HM Treasury
8
Conclusion
Thirty-First Report - Environmental Lan…
Not Addressed
The ELM scheme consists of three components: • The Sustainable Farming Incentive (SFI), which will pay farmers for actions to manage their land in an environmentally sustainable way; 2 C&AG’s Report, The Environmental Land Management scheme, Session 2021–22, HC 664, 15 September 2021 3 C&AG’s Report, para 1 - 3 …
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The ELM scheme consists of three components: • The Sustainable Farming Incentive (SFI), which will pay farmers for actions to manage their land in an environmentally sustainable way; 2 C&AG’s Report, The Environmental Land Management scheme, Session 2021–22, HC 664, 15 September 2021 3 C&AG’s Report, para 1 - 3 4 Committee of Public Accounts, Progress on the Common Agricultural Policy Delivery Programme, Fortieth Report of Session 2016–17, HC 766,10 February 2017 5 Q 43; C&AG’s Report, para 1 – 3; Department for Environment, Food & Rural Affairs, A Green Future: Our 25 Year Plan to Improve the Environment, January 2018 6 C&AG’s Report, para 1.10 10 Environmental Land Management Scheme • Local Nature Recovery, which will pay farmers for more complex actions that deliver benefits at a local level and encourage collaboration between farmers; • Landscape Recovery, which will support large-scale projects to deliver landscape and ecosystem recovery through long-term land-use change projects.
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Government response AI summary
The government response describes the Future Farming and Countryside Programme and the ELM scheme's components and timeline, but it does not address the committee's observation.
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HM Treasury
14
Conclusion
Thirty-First Report - Environmental Lan…
Not Addressed
The Department is developing the ELM scheme through a system of ‘co-design’, which they have now started to refer to as “co-creation”. This is working collaboratively with farmers and others to obtain continuous feedback and input as they iterate the design of the programme.34 Both the National Farmers’ Union and …
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The Department is developing the ELM scheme through a system of ‘co-design’, which they have now started to refer to as “co-creation”. This is working collaboratively with farmers and others to obtain continuous feedback and input as they iterate the design of the programme.34 Both the National Farmers’ Union and the Tenant Farmers Association told us that they felt very engaged in the process, but both also raised concerns about the effectiveness of the Department’s approach. The National Farmers’ Union highlighted the importance of ensuring that farmers’ first engagement with the scheme in 2022 is a positive one, to keep them engaged into the future. It told us that it did not feel that there was a co-ordinated approach to the scheme’s development and that co-design process was creating “a little bit of chaos”, explaining that “everyone is chipping in, and nobody really knows exactly where scheme design is getting to”.35 It described Defra’s approach to co- design as “scatter-gun” and asserted that co-design cannot replace consultation, and that the Department’s plans were lacking in detail, particularly around the later components of the scheme, Local Nature Recovery and Landscape Recovery.36 The Tenant Farmers Association felt that it was inputting heavily into the design but, as it was not seeing specific details from the Department, it could not support its members in understanding what is planned. It also told us that, due to the focus on the co-design strategy, the Department was mistaking activity for progress in the scheme design.37 In addition to engaging with farming organisations on co-designing the scheme, the Department told us that it was 30 Q 12; Committee of Public Accounts, Progress on the Common Agricultural Policy Delivery Programme, Fortieth Report of Session 2016–17, HC 766,10 February 2017 31 Committee of Public Accounts, The Common Agricultural Policy Delivery Programme, Twenty-sixth Report of Session 2015–16, HC 643, 2 March 2016 32 Committ
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Government response AI summary
The government commits to writing to the Committee by February 28, 2022, to explain how ELM plans are developed in partnership and the approach to operational readiness, responding to a separate recommendation (not provided in the input for this ID), not the committee's conclusion #14 …
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HM Treasury
17
Conclusion
Thirty-First Report - Environmental Lan…
Not Addressed
As part of the new scheme, direct payments to farmers will reduce by 55% by 2024– 25 before being phased out completely. The NAO found that the Department expects the reduction in direct payments and introduction of its replacement arrangements to have a significant impact on profits for many farmers. …
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As part of the new scheme, direct payments to farmers will reduce by 55% by 2024– 25 before being phased out completely. The NAO found that the Department expects the reduction in direct payments and introduction of its replacement arrangements to have a significant impact on profits for many farmers. Analysis of the Farm Business Survey shows that many farmers are reliant on direct payments to support their business. Without direct payments, and with no other changes (such as income from new schemes or rent reductions), the average farm in England would have an annual net profit to the farmer of only £22,800, a fall of 53% compared to their average profit for previous years. Over a third (38%) of farmers would make a loss without direct payments.52 The Department asserted that farmers can manage the impact of these reductions through a range of business improvements. It expected that this would include both increasing income, such as through participation in schemes and other approaches such as diversification or exports, and reducing costs through improving productivity and reducing waste.53
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Government response AI summary
The government response addresses PAC recommendation #3 (not provided in the input for this ID) regarding forecasts for land use, payments, and food production, not the committee's conclusion #17 about the impact of direct payment reductions on farmer profits.
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HM Treasury
18
Conclusion
Thirty-First Report - Environmental Lan…
Not Addressed
We asked the Department what farmers were feeling about the new scheme and the reduction in direct payments. The Department recognised that while some saw the scheme as a “welcome opportunity to embrace a new future”, some feel very threatened by it and were anxious about the future.54 The RPA …
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We asked the Department what farmers were feeling about the new scheme and the reduction in direct payments. The Department recognised that while some saw the scheme as a “welcome opportunity to embrace a new future”, some feel very threatened by it and were anxious about the future.54 The RPA accepted that both it and the Department had a role to help assuage that anxiety and “encourage people to embrace the fact that by changing farming practice there might be a different way forward”.55 The Department stressed that the schemes it is introducing are intended to be widely available to all types of farms. We highlighted, however, that being available is not the same as these schemes providing sufficient support for farms to stay in business.56
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Government response AI summary
The government response addresses PAC recommendation #6 (not provided in the input for this ID) about identifying further support for farmers' well-being and business challenges during the transition, not the committee's conclusion #18 regarding farmer anxiety and the distinction between scheme availability and sufficient business …
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HM Treasury
24
Conclusion
Thirty-First Report - Environmental Lan…
Not Addressed
Although the Department has set out its high-level vision for ELM through six ‘outcomes’ set out in the 25-Year Environment Plan, it has not yet defined the specific objectives that it will be using to measure ELM’s success against this vision. HM Treasury’s Green Book highlights the importance of having …
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Although the Department has set out its high-level vision for ELM through six ‘outcomes’ set out in the 25-Year Environment Plan, it has not yet defined the specific objectives that it will be using to measure ELM’s success against this vision. HM Treasury’s Green Book highlights the importance of having up to five or six SMART (specific, measurable, achievable, realistic and time-limited) objectives for all programmes. The Department’s outline business case for the Programme sets out 24 SMART objectives, but that these are described as provisional and indicative, and the estimated cost of delivering them in full is significantly above the annual budget for ELM. Clear objectives are needed for effective appraisal, planning, monitoring and evaluation.67 The National Farmers’ Union similarly highlighted the importance of having clear objectives in designing the scheme. It explained that they were necessary to set the parameters for scheme design and that it had seen various standards within SFI being reworked multiple times due to key decisions not having been made.68
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Government response AI summary
The government response addresses PAC recommendation #2 (not provided in the input for this ID) regarding developing and publishing clear metrics for ELM, not the committee's conclusion #24 regarding the lack of defined specific objectives for measuring ELM's success.
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HM Treasury
25
Conclusion
Thirty-First Report - Environmental Lan…
Not Addressed
The NAO recommended that the Department should urgently agree a clear, realistic and logical set of strategic objectives for ELM. We asked when we could expect these to be in place. The Department also acknowledged the importance of setting these objectives. It told us that it had developed a draft …
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The NAO recommended that the Department should urgently agree a clear, realistic and logical set of strategic objectives for ELM. We asked when we could expect these to be in place. The Department also acknowledged the importance of setting these objectives. It told us that it had developed a draft set of measurable outcomes, and it was currently discussing with Ministers how to prioritise these with a view to publishing them by Christmas 2021. The Department told us that this work was progressing and that there was more that it would publish in the coming months. However, these outcomes cover the current Parliament, rather than setting out how they will contribute to longer-term government initiatives such as net zero. It told us, however, that questions about its detailed plans for spending and investment in the next Parliament, and in 2024 and beyond, were still open and while it planned to answer these, it did not consider them as urgent.69
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Government response AI summary
The government's response reiterates its commitment to developing clear metrics and reporting annually on the delivery of targets within the Environmental Improvement Plan, but this does not specifically address the committee's conclusion regarding the urgent agreement of long-term strategic objectives for ELM.
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HM Treasury
26
Conclusion
Thirty-First Report - Environmental Lan…
Not Addressed
We told the Department that we were concerned about the lack of baseline data, and asked what data it will use to measure environmental improvements.70 In its written evidence, the Green Alliance emphasised the importance of being able to measure outcomes in order to demonstrate value for money. It recommended …
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We told the Department that we were concerned about the lack of baseline data, and asked what data it will use to measure environmental improvements.70 In its written evidence, the Green Alliance emphasised the importance of being able to measure outcomes in order to demonstrate value for money. It recommended that the Department should “develop standardised approaches for measuring outcomes and progress towards achieving overall objectives, and make sure they are adequately monitored to prevent potential environmental damage due to mistakes in execution.”71 We observed that in previous schemes payments were based on field sizes, which are easily measured, whereas in the new system it was difficult to tell what is going to be measured and what baseline it will be measured from, without accurate baseline data. The Department asserted that it had a very good understanding of the baseline data with respect to land. It explained that, for the soil standard, the first component of the scheme to be rolled out as part of SFI22, payments will be per hectare of land on which specified actions are carried out. The Department told us that this was because it believes it already had a detailed 67 C&AG’s report para 1.17 – 1.18 68 Q 3 69 Qq 43–44 70 Q 76 71 EMS0003 – Environmental Land Management Scheme, Green Alliance, 22 October 2021 20 Environmental Land Management Scheme understanding of the activity necessary to deliver the environmental benefits intended, and therefore a baseline was not necessary to assess whether a required outcome has been achieved. It explained that later scheme components, such as peatland restoration, will benefit from a more detailed assessment of the current condition of the land in order to measure progress and the impact of the scheme. The Department told us that it had a good understanding of the environmental quality of different areas of land, and that it planned to use this to identify actions that can be taken on specific farms through the L
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Government response AI summary
The government response addresses PAC recommendation #2 (not provided in the input for this ID) about developing and publishing clear metrics for ELM, not the committee's conclusion #26 regarding concerns about the lack of baseline data for measuring environmental improvements.
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HM Treasury
27
Conclusion
Thirty-First Report - Environmental Lan…
Not Addressed
ELM and other agricultural policies are expected to contribute to government’s environmental objectives, such as species abundance and the 25-Year Environment Plan. However, the RSPB highlighted that there is no overarching vision for agriculture in England or for how ELM will contribute to these wider objectives.73 The recently published net-zero …
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ELM and other agricultural policies are expected to contribute to government’s environmental objectives, such as species abundance and the 25-Year Environment Plan. However, the RSPB highlighted that there is no overarching vision for agriculture in England or for how ELM will contribute to these wider objectives.73 The recently published net-zero strategy highlighted ELM as a key driver of net-zero,74 but the National Farmers’ Union told us that it had not yet seen this reflected in the development of the scheme. It suggested that the ambition may be too great and questioned whether the ELM budget was sufficient to deliver on all of the environmental objectives attributed to it.75 The Confederation of Forest Industries agreed that there was a lack of clarity about how ELM fits in with other schemes and with Government commitments around net zero and tree-planting targets.76 The expected impact of the scheme on the farming sector
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Government response AI summary
The government response addresses PAC recommendation #2 (not provided in the input for this ID) about developing and publishing clear metrics for ELM, not the committee's conclusion #27 regarding the lack of an overarching vision for agriculture and ELM's contribution to wider environmental objectives.
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HM Treasury
30
Conclusion
Thirty-First Report - Environmental Lan…
Not Addressed
The Department told us that it did not think that ELM’s focus on environmental management would result in the UK importing more food. It explained that the scheme was also designed to boost productivity so that, despite taking land out of production to deliver environmental benefits, farmers can produce more …
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The Department told us that it did not think that ELM’s focus on environmental management would result in the UK importing more food. It explained that the scheme was also designed to boost productivity so that, despite taking land out of production to deliver environmental benefits, farmers can produce more food from the remaining land. It said that this would potentially free up some land to convert to forestry without the need to import any more food. This was echoed by the RSPB, which told us that delivering environmental benefits could also support long-term viable farming and directly improve farm businesses through increased yield. The Department said that there was nothing in its approach or programme that suggested that in 10 years’ time the UK would be importing more food.83
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Government response AI summary
The government response addresses PAC recommendation #3 (not provided in the input for this ID) about explaining farming program impacts on food production and productivity, not the committee's conclusion #30 regarding ELM's potential impact on UK food imports.
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HM Treasury
31
Conclusion
Thirty-First Report - Environmental Lan…
Not Addressed
The Tenant Farmers Association told us that the introduction of the new scheme was a major concern for its members, and that it would be important that the scheme contained options to meet the specific needs of both tenant farmers and of small farms. It emphasised that these were not …
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The Tenant Farmers Association told us that the introduction of the new scheme was a major concern for its members, and that it would be important that the scheme contained options to meet the specific needs of both tenant farmers and of small farms. It emphasised that these were not the same, as there are some large tenant farms, and not all small farms are tenanted.84 We asked the Department what the likely impact of the scheme would be for smaller farms or tenanted farms and whether taking land out of food production would mean these farms would go out of business. The Department told us that the size of the farm “does not of itself inform the efficiency of the farm”.85 David Kennedy, Director-General for Food, Farming and Biodiversity, expanded on this by stating that the Department’s objective was “that every farm can now be viable in the future through the farming transition”,86 and that the Department’s evidence and analysis showed that this was possible. The Department also explained that, although small farms and tenant farmers were more reliant, on average, on direct payments, the scheme would not just take direct payments away, but the focus on improving productivity and resilience would mean that every farm would have an opportunity to prosper in the future. It similarly told us that the uptake of the pilot suggested that the scheme would be attractive to small farms and to tenant farmers.87 80 Q 23 81 Committee of Public Accounts, Achieving Net Zero, Forty-Sixth Report of Session 2019–21, HC 935, 5 March 2021 82 Q 23 83 Qq 23, 61, 134 84 Qq 4–5 85 Qq 59–60 86 Q60 87 Qq 60, 111 22 Environmental Land Management Scheme
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Government response AI summary
The government response addresses PAC recommendation #7 (not provided in the input for this ID) about ELM complexity and feedback from the SFI pilot, not the committee's conclusion #31 regarding the specific needs and concerns of tenant and small farms.
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HM Treasury