Unexpected early payment welcome news as farmers struggle

IT is that time of year again with the Basic Payment Scheme (BPS) and Countryside Stewardship claim deadlines fast approaching.

This year the deadline is midnight on Monday May 16 and so all eligible farmers are advised to make sure they get their applications in as soon as possible.

However, at the end of last week and completely out of the blue, BPS applicants received an email from the Rural Payments Agency announcing that the Government has decided to bring forward 50% of this year’s BPS payment as an advance injection of cash to farm businesses.

It is planned this payment will be made in July to provide farmers with confidence in these uncertain times while the balance of the BPS payment will then be made during the usual payment window from December 2022 onwards.

The announcement came from Defra secretary George Eustice who explained this advance payment was being made because of the extraordinary spike in fuel and fertiliser costs which means that farmers are carrying an increased risk on their profit and loss account.

He went on to explain that the Government recognised that this has put increased pressure on the cash flow for many farmers, hence the Government’s decision to bring forward some of the BPS payment this year.

Mr Eustice also explained that the Government intends to make this a permanent change so that in future the BPS payment will be made in twice-yearly instalments. Mr Eustice, being a great Brexit supporter, then went on to add that this change would not have been possible had we still been in the EU.

This will be very welcome news for many farmers whose cash flows have indeed been put under pressure this spring as they have had to purchase extremely expensive fuel and fertiliser while crossing their collective fingers that produce prices do not fall back too far before future crops are harvested or livestock sold.

Farmers must appreciate this does not mean the amount of money they receive through the BPS is going to increase; it is merely that the payment is going to be paid in two instalments.

It should also be remembered that this year’s payment will be approximately 15% less than last year’s payment and that these direct payments are to be phased out altogether by 2027.

Even so, this will be welcome news for many farmers in light of massive increases in input costs over the last six months or so.

■ James Stephen, Carter Jonas