On 10 March, The Department for the Environment, Food and Rural Affairs (DEFRA) published its plans for piloting and launching the Sustainable Farming Incentive (SFI), one of three strands of the new Environmental Land Management subsidy scheme (ELM). Unfortunately, it excludes the smallest farms. But it’s not too late to change that.
Current subsidies under the EU Common Agricultural Policy (CAP) are distributed largely in proportion to the amount of land farmed and are not means-tested. The National Audit Office found that this results in a seriously unequal distribution of payments with many high-income households benefiting the most. Conscious of this, DEFRA hopes that the new scheme will use public money to reward farmers for creating ‘public goods’, rather than simply consolidating land ownership.
However, DEFRA plans to initially roll the scheme out only to those currently in receipt of the Basic Payment Scheme (BPS). This excludes farms under 5 hectares. DEFRA has as yet failed to commit to abolish this 5 hectare threshold as the scheme is expanded, and these small farms will also be excluded from the pilot. This is an injustice, and represents a huge missed policy opportunity.
When BPS was introduced in 2014, 18,000 farmers on plots under 5 hectares ceased to be eligible for payments. As of 2019, there remained 28,394 hectares of commercial farms under 5 hectares, across 16,325 holdings in England. This makes up 15% of all commercial agricultural holdings in England, representing a substantial proportion of farmers.
Small farms are productive
DEFRA makes it clear in its announcement that it is ‘committed to building the future schemes through a process of “co-design”’, yet by excluding thousands of small farmers at the outset, it may fail to invite some of the most creative, resilient and productive farmers to the table. Analysis carried out by the Food, Farming and Countryside Commission (FFCC) found that ‘the best performing small farms are more productive, £ for £, than the best performing large farms.’ There is abundant evidence from practitioners that agroecological farms under 5 hectares create more jobs, are more resilient, and are profitable businesses.
It could be argued that if these small farms are profitable without relying on CAP subsidies, there is no need to subsidise them. However, the ELM scheme purportedly exists to incentivise better farming practices, not to compensate for financial shortfalls. In that case, these small farms deserve a seat at the table.
Peri-urban farms and market gardens can be included
Small peri-urban farms and market gardens, too, could provide valuable insights for the development of the scheme, and may lose out by being discounted for their small size. These offer a high density of ‘public goods’ per hectareincluding the potential to reduce urban health inequalities. A study at Sheffield University found that growing fruit and vegetables in just 10% of Sheffield’s urban green spaces ‘could provide 15 per cent of the local population with their “five a day”’. However, this still remains a largely unfulfilled potential in our urban landscapes.
Small farms lend themselves to highly productive, agroecological horticultural production. In 2019, of the total land made up of farm holdings under 5 hectares, 8% was used for horticulture, but as recently as 2009, that figure was 20%. Indeed, between 1985 and 2014, there was a decline of 27% in land used to produce fruit and vegetables across all farm sizes. Despite this, and with just 3.5% of croppable land in the UK used for this purpose, £3.7 billion’s worth of horticultural produce is currently grown annually. With the right incentives, small horticultural farms could be re-established, and deliver on a host of public goods, from job creation to soil health and public health.
Opportunities for new entrants
These smaller farm units are also a vital rung-on-the-ladder for first-time farmers. Notoriously difficult to break into, the farming profession is edging towards a crisis. DEFRA’s latest study identified that the median age of farmers in the UK is 60, and that a third of all agricultural land holders are over the typical retirement age of 65. With the country’s stock of County Farms – a vital in-road into farming – diminishing, new entrants have limited options for gaining access to farmland whose prices have surged in the last two decades. Add to that lack of capital, lack of infrastructure, and insufficient training and routes to market, and we begin to see why farming has been called a ‘closed profession’.
Now is the time to invest in these small units, where young talent can be nurtured and fresh ideas can be fed into DEFRA’s pilot scheme. Importantly, this represents an opportunity for DEFRA to engage directly with voices commonly underrepresented in farming: 98.6% of farmers identify as White British, making the sector the least diverse in the country. Only 17.6% of people working in agriculture or agriculture-related services are women.1 In contrast, a study carried out by the Landworkers’ Alliance on 156 new entrant farmers found that 82% identified as White British (below the figure for the UK population at large, 86%), 54% identified as female and 1% as other.
A missed policy opportunity
By excluding these small farms, even if only initially, DEFRA will miss out on crucial years when they could be:
- Learning, and incorporating into the SFI, important lessons from a highly productive group of farmers and growers who generate an abundance of public goods;
- Supporting and advancing the creation of more peri-urban and horticultural enterprises, which can provide a range of public goods nation-wide and, potentially, focused in areas of high deprivation;
- Engaging with and supporting new entrants and the diverse voices represented in this group.
If DEFRA hopes to create a fairer, more sustainable farming sector that generates public goods for the whole of society, small farms need to be integrated into the blueprints from the start.
Bella Driessen is Research Assistant at the Food Research Collaboration, based at the Centre for Food Policy, City, University of London.
 Including Agricultural Managers and Proprietors, Agricultural and Related Trades, Elementary Agricultural Occupations and Agricultural Machinery Drivers