Farmers wanting to retire set to be offered "exit payments" by government
The idea is to help the next generation of farmers into the industry
Farmers across the South West who want to retire but can't afford to will be offered money from the government from next year.
A consultation is starting on the idea for so called exit payments; it's all part of a plan to encourage more people into the industry.
In a statement the government says it will be open for 12 weeks starting today and focus 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 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 - Direct Payments currently made through the Basic Payments Scheme offer poor value for money and are based on how much land a farmer has, which inflates rent and can stand in the way of new entrants. The Government plans to phase Direct Payments out over a 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.
"A vibrant farming industry also needs to attract new talent and create more opportunities for new entrants and farmers wishing to expand their businesses," the statement reads.
"The Government is 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 from 2022, with recommendations for its design set to be shared later in the year.
Environment Secretary George Eustice said: “We need to address the twin challenges of helping new entrants fulfil their dream and gain access to land, while also helping an older generation retire with dignity.
“Our exit scheme will offer farmers who want to exit the industry all of the area payments they would likely have received until the end of the transition period in a single lump sum.
"It gives them a real incentive to confront what can often be a difficult decision and will help them clear bills and settle debts. "
He says by renting out their farm or surrendering their tenancy, those leaving the industry will create new opportunities for the next generation of farmers.
Today's news follows last year's announcement of theAgricultural Transition Plan, to reward farmers for sustainable practices.
The statement goes on: "The proposals within the consultation seek to offer a fairer system for farmers, encouraging generational change by providing more flexibility for new entrants to start up their farm businesses and supporting those who are ready to leave the sector to do so on their own terms. "
The consultation will close for responses on 11 August 2021.