Based on 'blind optimism' is how a select committee has described the government's new payment schemes for farmers.

In a report about the environmental land management scheme (ELMS) published today (Sunday, January 9) the Public Accounts Committee says that Defra itself concedes “its confidence in the scheme looks like blind optimism”.

The committee has found a distinct lack of detail on how the productivity increases and environmental benefits will come about and when.

The report also points out that tenant and smaller farmers may not be able to navigate the complexities of the scheme's bureaucracy.

The ELMS is replacing the EU's Common Agricultural Policy and will see farmers' income from direct payments drop by more than half in 2024/5.

But the committee says the scheme appears “beset with many of the same issues that have undermined ambitious government programmes in recent years” and the lack of information from Defra early enough to allow farmers to plan their businesses and take advantage of the new opportunities “is causing anxiety in the sector, exacerbated by a historic lack of trust caused by the Department’s past failures in managing farm payments”. 

In addition, it says Defra has “not explained how the scheme’s changes in land use will not simply result in more food being imported, with the environmental impacts of food production being ‘exported’ to countries with lower environmental standards.”  

The committee also warns that Defra has not established the metrics or objectives to enable it to demonstrate that the £2.4 billion a year it plans to spend on agricultural schemes is providing value for money, or contributing to government’s wider environmental goals including the statutory commitment to reach net-zero carbon economy by 2050. 

Sir Geoffrey Clifton-Brown, Deputy Chair of the Public Accounts Committee, said “We have known we were replacing the CAP since 2016 and still we see no clear plans, objectives or communications with those at the sharp end - farmers - in this multi-billion pound, radical overhaul of the way land is used and, more crucially, food is produced in this country.

“Farmers, especially the next generation of farmers who we will depend on to achieve our combined food production and environmental goals, have been left in the dark and it is simply wrong that Defra’s own failures of business planning should knock on to undermine the certainty crucial to a critical national sector.

“As the report makes clear, without subsidies the average farm in England makes a net profit of just £22,800 a year including all labour and investment in businesses.

"The fear therefore for small and tenant farms who are operating on wafer-thin margins is that many will go out of business and the average size of farms will increase and some of the environmental benefits of ELMs will be lost.

“The UK is also already a large net importer of food and we heard in evidence that the ELMS’ vague ambition to ‘maximise the value to society of the landscape’ may in reality mean that increases further.

"The recent energy price crisis should be a salutary warning of the potential risks to the availability and affordability of food if the UK becomes even more reliant on food imports.”

The details of the full inquiry can be found at committees.parliament.uk/work/1472/environmental-land-management-scheme.