The UK’s Labour government is set to cut the farming budget in England by £100 million annually, sparking concern across the agricultural sector. While the Department for Environment, Food and Rural Affairs (Defra) claims the changes will boost nature-friendly farming, industry leaders say the figures are misleading and could harm farm productivity.
The new budget will allocate an average of £2.3 billion per year up to 2028–29, dropping to £2.25 billion by the end of the period. Of this, £2 billion will be directed toward the Environmental Land Management schemes (Elms), with the remaining £250 million going to productivity grants. This is £100 million less than the £2.4 billion per year previously guaranteed to farmers post-Brexit—funds that were meant to replace EU subsidies.
Sanjay Dhanda, senior economist at the National Farmers’ Union (NFU), criticized Defra’s narrative, saying: “Comparing the current Elms funding to the £800 million figure in 2023–24 is misleading, as the scheme wasn’t fully operational and basic payment schemes [BPS] still absorbed a significant share of funding.”
Growing Frustration Over Nature Fund Access and Tax Burden
Tensions between farmers and the Labour government have been rising, with mass protests erupting over the proposed inheritance tax on farms exceeding £1 million. Additionally, farmers fear being excluded from future Elms grants, particularly larger landholders. Defra was recently forced into a U-turn after announcing a freeze on new applications for Elms, following legal threats from the NFU.
Former farming minister Mark Spencer expressed deep frustration over the budget cut, stating: “We made such huge progress, and now it is in jeopardy. The Elms fund was meant to be fully allocated to farmers. This change is a step backwards.”
Nature Groups Offer Cautious Praise for Partial Protection
Despite the overall reduction, nature and environmental groups cautiously welcomed the budget, noting that fears of deeper cuts had been avoided. Steve Reed, the new Environment Secretary, was praised by groups like the National Trust for maintaining support for nature-focused agriculture under challenging financial conditions.
A Defra spokesperson defended the funding plan, stating: “Contrary to reports of a £1.2bn cut, the government is investing a record £5.9 billion over the next three years in nature-friendly farming.”
