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Home > News > Defra unveils proposals for lump sum retirement scheme

Defra unveils proposals for lump sum retirement scheme

19th May 2021 / By Alistair Driver

BPS claimants will be offered lump sum payments if they wish to leave the industry, under the reform of farm payments in England. 

Defra has also announced plans for a new entrants scheme, set to be available from next year. 

Defra said the changes, outlined in a consultation, published today, on changes to the Basic Payment Scheme (BPS) to support farmers through the agricultural transition period from now until 2027, will deliver a fairer system where payments are no longer based on size of land.

The consultation will be open for 12 weeks until August 11 and focuses on two key areas:

Lump sum exit scheme – Building on evidence that some farmers would like to retire or leave the industry but have found it difficult to do so for financial reasons, the Government proposes to offer them a lump sum payment in place of any further Direct Payments to help them do this in a planned and managed way. The consultation seeks views on who should be eligible for these lump sum payments and how the payments should be calculated.

Delinked payments - The Government plans to phase direct payments out over the gradual seven-year transition period, to move to a 'fairer system'. The consultation includes plans to separate the payment from the amount of land farmed, from 2024. This will simplify the process for farmers, allow them to focus on running their business and encourage them to take up the government’s new environmental land management schemes, which will reward sustainable food production and environmental improvements. The consultation seeks views on how the ‘delinked’ payments will be calculated.

For pig farmers, the above will only apply to BPS claimants, meaning some producers will not be eligible.

New entrant scheme

The Government said it was also working together with industry leaders, local councils, land owners and new entrants to co-design a scheme to create real opportunities for new farming businesses.

The new scheme will be available to support new entrants from 2022, with recommendations for its design to be shared later in the year.

You can read more HERE