Lack of Incentive? Or Lack of Trust?
Single Farm Payment saw an average cut of 22% for farmers last year with the money supposedly diverted to the Sustainable Farm Incentive amounting to 0.44% of total funding to farmers. [i]
There has been a great deal of investment in promoting environmental schemes through Future Farming, press and media, but uptake of environmental schemes is currently low. Why is this?
Several days ago I had two conversations with different farmers, both farming similar farms within 30 miles of each other:
The first farmer I spoke to we started by discussing working capital costs. He explained to me that he had managed to keep these about the same , but at the expense of decreased productivity. He had entered into additional environmental stewardship schemes and the Sustainable Farm Incentive. He was, considering the times we are in, quite happy with his lot, and was on target to be increasingly profitable financially on his mixed farm. He felt that commercially environmental stewardship and SFI was the direction to go in.
The second farmer I spoke to also discussed working capital costs. He explained that he had managed to keep these only slightly higher than the previous year by growing lower cost crops, in this case spring barley and oats and reducing his fertilizer input in part by increasing his livestock, which being beef and sheep he was also happy with their returns. He had been advised by Future Farming advisors to adopt stewardship schemes and make life easier for himself at the same time by reducing stock. The difficulty he had in accepting this was that it would reduce his profitability by reducing the quantity of livestock permitted. He was also concerned that reducing livestock would also mean less manure. Certainly, adopting the schemes would also increase working capital costs, at least in the short term. He was not prepared to enter any further stewardship schemes or the Sustainable Farm Incentive. The biggest issue he had was trust. His experience with both the old Single Farm Payment and the Stewardship schemes he has already had is that of late paperwork, difficulty getting returns processed and submitted, especially as he has slow internet in his area. Furthermore he viewed such schemes as a one way commitment – he did not trust government to have a change of policy and cancel all the schemes and accompanying payments. Trust was perhaps his largest issue.
Later that week I spoke to a third farmer and he turned around and said, “ I don’t see the point in spending money on any grants or stewardship schemes when you have to borrow more at increasing interest rates to fund them.” That is an understandable viewpoint.
The simple fact is that confidence in government is so low that any scheme coming from them is treated with suspicion and caution. This lack of trust is possibly enlarged by energy costs and interest rates increasing.
For any environmental policy to be attractive to farmers government needs to create that most valuable commodity first – trust.
[i] Source Helena Horton The Observer 12.2.23