The Sustainable Farming Initiative (SFI) became live on 1^st July 2022 and is now open for applications from all farmers and landowners who currently receive Basic Payment Scheme (BPS) payments in England only.

What is the Sustainable Farming Incentive?

The Sustainable Farming Incentive (SFI) is one of the three pillars of the new Environmental Land Management (ELM) scheme along with Local Nature Recovery and Landscape Recovery. A pilot SFI was launched last year but due to clashes with Countryside Stewardship (CS) options, the pilot scheme proved to be of little value to anyone in a CS scheme. The pilot identified this as a problem and the issues around CS have been eased for the arable scheme which is now due to be released this summer. 

SFI Scheme

Points to note:

• Agreements will last for three years but with the option for annual amendments. 
• Farmers will receive their first payment three months after joining, followed by quarterly payments thereafter.
• There will also be no old-style application windows, allowing farmers to enrol in the SFI scheme at whichever point in the year is suitable for them. 
• SFI agreement holders will need management control of the land so that landlords will not be eligible in most circumstances. Licensees of land are unlikely to be eligible but the licensor may be. 
• No capital payments are available initially but will be later in the rollout. 

The standards available for 2022 are:

• the Arable and Horticultural Soils standard 
• the Improved Grassland Soils standard 
• the Moorland and Rough Grazing standard (introductory level).

The scheme will be expanded as direct payments are reduced over the next three years and by 2025 a full set of standards will be in place. These will include payments for integrated pest management (IPM) and a hedgerow standard.

SFI Arable Soils Standard

For the arable soils standard, an introductory level (£22 per ha) and an intermediate level (£40 per ha) will be available this year with the advanced level available in 2023. Both of the above options require testing of soil organic matter (within the five years before or during the first year of entering SFI), undertaking soil assessments and building a soil management plan, winter cover (including cover cropping) to protect soil and actions to build soil organic matter. These payments are therefore not without significant expense and before entering SFI full costings should be made and it should also be borne in mind that CS offers more attractive payments for some of these actions.

SFI Improved Grassland Standard

For the improved grassland standard options are paid at £28 per hectare for the introductory level and £58 per ha for the intermediate and again the advanced level is not initially available. 

Both of the above options require testing of soil organic matter (within the five years before or during first year of entering SFI), undertaking soils assessments and building a soil management plan, minimum levels of bare soil over winter and in addition the intermediate level requires the establishment or maintenance of herbal leys. Again, some of these options pay more in CS so it’s important to evaluate both schemes before entering. Talk to us to evaluate the best options for your business.

More information is available at https://www.gov.uk/ government/publications/ sustainable-farming-incentive -how-the-scheme-will-work- in-2022/sustainable-farming- incentive-how-the-scheme- will-work-in-2022 

Local Nature Recovery, Landscape Recovery and other Capital Grants will be made available over the next few years. 

How to apply for SFI

You can apply for SFI at: https://www.gov.uk/guidance/how-to-apply-online-for-an-sfi-standards-agreement-on-land-outside-a-common

Whilst Defra would like to say it’s a quick and simple application process there are potential traps for the unwary. If you would like some pre-application advice, or indeed some help with the application, please don’t hesitate to get in touch on 01256 389253 or via email: jack@moundsmere.co.uk.