The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)

My Lords, I declare an interest as I am in receipt of delinked payments. This instrument sets the reductions that will apply to delinked payments in England in 2025. These reductions are a vital part of the transition to more targeted public investment supporting farmers to boost nature and sustainable food production. A fatal amendment has been tabled that, if approved, would mean the agricultural transition would effectively go into reverse, as no reductions at all would be applied. I want to be clear that voting against this SI would not keep payments at the level they were for 2024. Instead, it would mean that delinked payments would go back to the 2020 subsidy levels. The fatal amendment also calls for the reinstatement of applications to SFI, but, without the reductions set by this instrument, we cannot fund SFI. Indeed, payments under many of our farming schemes would need to stop completely. The regret amendment that has been tabled expresses concern about the impact of the reductions on farm viability. This Government recognise that farmers run businesses that need to make a profit, and we understand the valuable role that these businesses play in the wider rural community. We want to support farm businesses to be more profitable and address the underlying problems so that they can thrive. Delinked payments do not achieve that. Delinked payments do not offer and never have offered good value for money for farmers or the taxpayer. They are part of the move away from the basic payment scheme that saw 50% of money go to the top 10% of farms while doing little for food production or nature. We are now in the fifth year of the seven-year transition away from these subsidies. The reductions to delinked payments set out in this instrument were announced last October. These reductions accelerate the end of the era of payments to large and wealthy landowners simply for owning land. However, the Government recognise the impact that these changes may have on some farmers, which is why we are trying to make them in the fairest way possible. We are applying the reductions in payment in bands, like income tax bands, meaning that those with the broadest shoulders will see the highest reductions. I assure noble Lords that every penny released from delinked payments is staying within the sector. The planned reductions are necessary to help fund investment in the environmental land management schemes and our other grants for farmers. So our support for farmers remains steadfast. We have committed £5 billion to the farming budget over a two-year period, with £2.4 billion of this for 2025-26. That includes the largest ever budget directed at sustainable food production and nature recovery in our country’s history. We have allocated £1.8 billion in 2025-26 for environmental land management schemes. This will boost Britain’s food security and accelerate the transition to the more resilient and sustainable farming sector that we want to see. Importantly, we are on track to spend the farming budget in full. There are record numbers of farmers in our environmental land management schemes; 50,000 farm businesses, and more than half of all farmed land in England—that is, over 4 million hectares—are now managed under these schemes. Figures for 1 March show that that includes around 38,000 live multiyear sustainable farming incentive agreements, and we expect to publish more information about our revamped SFI offer this summer, following the spending review. The new Countryside Stewardship higher-tier offer will open for applications for invited farmers and land managers later this year. Applications for stand-alone capital grants will also reopen this summer after a short pause, and we are investing in around 50 landscape recovery projects that were awarded funding through rounds 1 and 2. In February, we announced increased payment rates for higher-level stewardship across a range of options from this year. We are also extending the Farming in Protected Landscapes programme until March 2026. This extension will support farmers in protected landscapes to transition towards profitable food production, while at the same time delivering nature recovery and mitigating the impacts of climate change. We are continuing to invest in farmers through our other grant offers, with up to £110 million available in new grant competitions that are starting this spring. This includes up to £47 million for Farming Equipment and Technology Fund grants, as well as up to £63 million available for Farming Innovation Programme grants. Those will help to improve productivity, trial new technologies and drive innovation in the sector. We are also expanding the animal health and welfare pathway, with more funded vet visits now available to farmers. Further, over 26,000 farmers have made use of free one-to-one business support through the Farming Resilience Fund to help them through the agricultural transition. By investing in healthy soils, abundant pollinators and clean water, the Government are investing in the foundations that farm businesses rely on to produce high crop yields and turn over a profit. Adopting the sustainable farming practices rewarded under our schemes will also help farmers to reduce their input costs. Reducing delinked payments as planned enables us to make these investments through our other schemes, and we believe this will serve the best long-term interests of farming. I welcome the recent appointment of the noble Baroness, Lady Batters, to lead the review of farm profitability to provide short-term, medium-term and long-term recommendations to the Government. The noble Baroness’s review will also help our development of the 25-year farming road map in order to make the sector more profitable in the decades to come. As we set out in our plan for change, we are focused on supporting our farmers by boosting rural economic growth and strengthening Britain’s food security. This SI is an essential step in building this future. I beg to move. Amendment to the Motion