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What is the Sustainable Farming Incentive (SFI)

What is the Sustainable Farming Incentive (SFI)

The SFI is the first in a package of environmental land management schemes from the Department for Environment, Food and Rural Affairs (Defra), which aim to provide farmers with a way to get paid for producing public goods such as cleaner water, cleaner air and carbon reduction. Farmers will be paid for environmentally sustainable actions such as managing and planting hedgerows.

Should you sign up for the SFI Pilot?

Defra published some details about the Sustainable Farming Incentive earlier this week setting out, in broad terms, the new Standards that land managers will have to comply with in order to receive payments in 2022. Testing of these Standards will be taking place through a National Pilot, involving hundreds of farms across England from this summer. Applications for the pilot launched today (Monday 15th March).

This has real significance for all Basic Payment Scheme (BPS) recipients, as the Standards indicate how Defra are turning the underlying principle of ‘public payments for public goods’ into practical, on farm reality.

Will organic certified systems be rewarded in SFI?

We have been working to ensure that public goods delivered by organic farms are neither missed out, nor taken for granted by Defra - there had been a notable absence of references to organic farming in previous Policy Statements. We are pleased to see that beginning to change, albeit with a long way to go.

‘The SFI scheme is intended to reward farmers for delivering environmental benefits across all farming systems, including organic farms.’

The Soil Association has been given the opportunity to audit the more detailed (unpublished) Standards that will be tested in the National Pilot. Defra is taking a keen interest in our audit, which is taking two forms.

  • To ensure that the definitions and rules do not unwittingly exclude organic land managers from being able to comply and therefore render them ineligible.
  • To do a ‘gap analysis’ identifying where organic farming systems go further than these Standards; and should allow either for changes to be made in the Standards; or make the case for ‘system recognition’ for Certified Organic elsewhere in the Environmental Land Management schemes (ELMs) transition.

Defra have not been supportive in recognising specific farming systems to date; but Certified Organic has proven outcomes of multiple public goods delivery and reliable, consistent year on year delivery that comes with whole farm system approaches. In addition, when it comes to monitoring and compliance of the SFI, organic certification should mean far less need for inspections. We have been making this case to Defra throughout, and it is encouraging to see that they will be doing some testing of it in the pilot.

‘During the Pilot we will also be considering the role accreditation schemes could play in supporting the delivery of environmental benefits we want to achieve under the SFI.’

How can organic farms apply to the SFI pilot?

It is important that some organic farms be included in the pilot, in order to ensure that proper testing is done. Land Managers can register their interest through registering on-line, subject to these eligibility requirements:

For the first phase of piloting, a farmer is only eligible if they:

  • are a recipient under the Basic Payments Scheme, registered on the Rural Payments Agency system
  • enter land parcels (for example, fields) into the pilot that do not have an existing agri-environment agreement on
  • have management control of the land for the duration of the pilot (scheduled to run until late 2024). They must either own the land with management control or have a tenancy of enough length to implement their pilot agreement (including landlord’s permission if required)
  • enter land parcels that are in England
  • enter land parcels that are not registered common land or subject to shared grazing

There is a potential problem around eligibility for Certified Organic land managers however, which is that land in Countryside Stewardship (CS) can’t be in the pilot. This will disqualify many who are already in CS, but will also prevent those wishing either to convert to organic, or to go into CS to compensate for declining BPS payments and who will be better rewarded under CS which has an Organic Land Management payment (which does not feature in the SFI).

We would be very interested to hear for you; either if you are willing to apply for the SFI pilot; or if you feel that the eligibility rules are going to unfairly bar entry into the pilot for organic farms. We are also very frustrated that eligibility is only for BPS recipients, which excludes holdings under 5 hectares.

There will be more announcements to come in relation to the other components of ELMs, and other areas of the Future Farming Programme. We will keep you up to date with our work as best we can, subject to Defra’s rules on confidentiality. If you don't already receive it, stay up to date with announcements by joining our monthly Organic Farming newsletter. You can add your email address to the pink box in this page.