Understanding the transition from Basic Payment Scheme to delinked payments
By Chris Wright, Partner and ARA specialist
The Government has recently confirmed that 97 per cent of farmers have received their final Basic Payment Scheme (BPS) payment, signalling a significant shift in agricultural funding.
Final BPS Payments and transition to Delinked Payments
The Rural Payments Agency (RPA) has released over £525 million into the rural economy, with farmers receiving their final BPS payments promptly. This marks a crucial step ahead of next year’s move to delinked payments. The RPA has completed more than 91,000 applications and claims across the BPS, Countryside Stewardship (CS), and Environmental Stewardship (ES) schemes.
Delinked payments, a new funding mechanism, will replace the BPS in England and are scheduled to run until the end of 2027. These payments will be calculated based on the average BPS payment made to each business from 2020 to 2022, offering a more streamlined approach to agricultural funding.
In addition to the BPS payments, the RPA has announced that around £70 million under the Environmental Stewardship (ES) scheme will be issued soon. This scheme is crucial for farmers focusing on environmentally sustainable practices, providing them with necessary financial support.
In response to feedback from the farming community, the RPA has expedited the release of Sustainable Farming Incentive SFI payments. Farmers who have an active SFI 2023 agreement before the end of this year will benefit from an accelerated payment.
This payment will be equivalent to a quarter of the annual value of their agreement and will be disbursed in the first month of the agreement. This early payment initiative is designed to enhance cash flow and support farmers in adopting sustainable farming practices more swiftly.
A critical aspect of the transition to delinked payments is the eligibility criteria. Farmers who have claimed and were eligible for the BPS in 2023 will automatically be considered for delinked payments. There is no requirement for a separate application process, as the RPA will automatically disburse payments to eligible farmers. This automatic payment system is designed to reduce administrative burdens and ensure a smooth transition for farmers.
Understanding the implications
The shift from BPS to delinked payments represents a significant change in the way agricultural funding is administered in the UK. It is essential for farmers to understand these changes and their implications on future farming operations and financial planning. The introduction of delinked payments, along with the continued support through schemes like the ES and SFI, reflects a broader move towards sustainable and environmentally conscious farming practices.
Farmers should stay informed about these developments and consider how they can align their farming operations with these new funding structures. Embracing these changes will not only ensure compliance with the new systems but also position farms to benefit from the evolving focus on sustainability and environmental stewardship in agriculture.
As always, we are here to support you. If you would like further information about the shift from BPS to delinked payments, please contact us.