Ministers have faced criticism from MPs, farmers and conservationists for the abrupt closure of a flagship nature-friendly farming payments scheme.
The Environment Department (Defra) announced late on Tuesday that the sustainable farming incentive (SFI) which pays farmers in England for “public goods” such as insecticide-free farming, wildflower strips and managing ponds and hedgerows, was fully allocated for this year.
As a result, the Government has stopped accepting new applications for the incentive – the largest part of the new environmental land management (Elms) programme which has replaced EU-era farming subsidies – with immediate effect.
Farmers have reacted with fury to what they described as another “shattering blow” to the sector, throwing farm businesses into further uncertainty and potential financial hardship.
Conservationists also raised concerns about the move to curb payments to nature-friendly farming initiatives, warning it showed the budget for the scheme was “inadequate” and calling for a better-resourced, more targeted and ambitious programme.
And MPs have warned that smaller farms in areas such as the Lake District National Park, where they should be able to receive funding for maintaining heritage landscapes, and some of England’s poorest farmers have missed out on support.
Food security minister Daniel Zeichner told the Commons that the Government planned to “redesign” the programme and said previous schemes had “no way of prioritising properly” the farmers who received support.
Mr Zeichner said “many, many farmers are now in these schemes and benefiting from them”, before adding a future programme could “properly be managed”.
He also told MPs that the “budget has been spent” for the SFI and a responsible government had to respond to that.
The Government said it had inherited farming schemes which were “underspent”, and had encouraged more farmers to participate, leading to a record 50,000 farm businesses taking part in Elms.
But it also inherited an uncapped scheme, despite a finite budget, and the highest level ever of participation in SFI means the maximum limit had now been reached.
The post-Brexit programme designed by the previous government, which focuses on public money for public goods such as nature restoration, healthy soil and clean water, has faced criticism over its roll-out and greater provision of payment options for wealthier arable farms than hill farmers.
But the sudden closure of this year’s scheme – with little clarity over what will come next – risks further souring the already strained relationship between the farming sector and the Government.
It comes as a bitter fight over the introduction of inheritance tax for wealthy farm businesses shows no sign of ending, and as farmers grapple with a speeded-up end to the old “basic payment scheme” on the basis of the amount of land farmed.
National Farmers’ Union president Tom Bradshaw said: “This is another shattering blow to English farms, delivered yet again with no warning, no understanding of the industry and a complete lack of compassion or care.”
He said the industry had warned “time and time again” that large parts of the SFI were poorly designed, and he accused Defra of being a “failing department” with farmers left paying the price for chaos.
“The awful dilemma now faced by many farmers is whether to turn their backs on environmental work and just farm as hard as they can to survive.
“This is a loss to both farming and the environment and cannot be what was intended,” he said.
Country Land and Business Association president Victoria Vyvyan described it as the “most cruel” of the “betrayals” so far.
“It actively harms nature. It actively harms the environment.
“And, with war once again raging in Europe, to actively harm our food production is reckless beyond belief,” she said.
And Martin Lines, chief executive of the Nature Friendly Farming Network (NFFN), said some farmers would be left in “a really difficult financial position” because of the pause before new payments would be available.
“This has left many farmers feeling frustrated and let down, with no clear opportunity to be rewarded for delivering public goods in the near future,” he said.
Phil Stocker, chief executive of the National Sheep Association, said the announcement was “disastrous”.
“For many in the uplands, when considering this latest removal of support with the decline of the basic payment scheme, the situation could be life-changing.
“Cash flow on these farms in 2025/26 will be seriously compromised and there will be a question over how supportive the banks will be and whether farms will be able to climb out of the financial hole this will leave,” he warned.
Conservative leader Kemi Badenoch accused the Government of treating farmers “with contempt” in a post on X, in which she also said: “First the Family Farm Tax, now withdrawing an important scheme without warning. Keir Starmer and Rachel Reeves do not care about rural communities.”
Conservation groups, who have long called for more funding for nature-friendly farming, also raised concerns.
Richard Benwell, chief executive of the Wildlife and Countryside Link coalition of nature and environmental groups, said the situation showed how high demand from farmers was and that the nature-friendly farming budget is inadequate.
“Farmers and environmentalists alike have urged the Government to consider significantly increasing the budget as part of the Spending Review.
“A better resourced, more targeted and more ambitious scheme would provide a boost to food security, flooding and river pollution prevention, and wildlife recovery and aid rural communities,” he said.