Agriculture (Delinked Payments) (Reductions) (England) Regulations 2025
Lord Roborough Excerpts(6 days, 23 hours ago)
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The Deputy Speaker (Baroness Finlay of Llandaff) (CB)
My Lords, I should inform the House that, if this amendment is agreed to, I will be unable to call the amendment in the name of the noble Lord, Lord Roborough, by reason of pre-emption.
Lord Roborough (Con)
My Lords, I thank the Minister for a thorough introduction to this SI. I have tabled a regret amendment on behalf of my Benches, but, in reality, it is on behalf of all English farmers. Regret is too gentle a word to describe the mood among the farming community.
Before I address the issues, I first draw the House’s attention to my registered interests as a farmer and landowner. I am directly impacted by this SI, with a 90% reduction in my delinked payments. I am at least sheltered by the SFIs that I have signed up to; that is not the case for the majority of farmers.
When in government, we replaced the basic payments scheme with delinked payments based on historical BPS claims. This was intended to be gradually phased out by 2028 in favour of environmental land management schemes, where farmers and landowners receive payments only for public goods. The reductions we put in place put these delinked payments on a gradual glide path to zero in 2028. This Government have dramatically accelerated that decline. This effectively ends the seven-year transition that English farmers had been led to expect three years early, upending their budgets.
The Government promised that this abrupt reduction would release more funding for sustainable farming incentives, Countryside Stewardship schemes and large-scale landscape recovery schemes—collectively known as environmental land management schemes. Despite a commitment to give up to six weeks’ notice of a planned closure of SFI applications, the Secretary of State abruptly closed applications with 30 minutes notice at 6 pm on 11 March, as the noble Baroness, Lady Grender, has said, apparently breaking two commitments at once.
Only a minority of farmers who were previously receiving BPS had actually signed up to SFIs. Today, I am speaking particularly for two cohorts of farmers who are bearing the brunt of this SI’s excessive reduction. The delinked payments cut is particularly painful for those who were unable to apply for SFIs as they were already in environmental schemes that were less profitable but designed to work alongside this phased reduction in delinked payments. Those farmers were simply abandoned, with no compassion from anyone.
When the SFIs were closed to new applications, this affected another cohort of farmers, who were expecting to replace old environmental schemes and the delinked payments with SFIs but who had not yet completed their SFI applications. These farmers are simply in despair. There is no transparency over the timing of the payments under new SFIs, nor what their nature will be. There is certainly no confidence that they will enable these farmers to continue delivering environmental goods as they had planned, or even, potentially, to remain in business.
The Minister earlier stated that the details of revised SFIs will be released this summer. Many farm businesses are in crisis after delinked payments and the cut of SFI applications. Could the Minister please indicate how much has been identified within the existing farming support budget for these new SFIs?
Our actions in government demonstrated our commitment to paying farmers with public money for the public goods they delivered, as well as allowing them to plan ahead financially with certainty. This Government have acted in a way that allows for no financial planning by farmers and have created incentives for those farmers now so disadvantaged to compromise environmental principles and push for greater output in order to remain in business.
Farming is a competitive industry. Food production is largely commoditised, and our farmers compete not just against their neighbours but also against farmers across our country, our continent and the world. Although many of our farmers are capable of competing effectively, smaller farms, particularly in less-favoured areas, can find this competition too much. When we rightly include our high demands for animal welfare and environmental protection, this competitiveness is further undermined. Is it any great surprise that the average age of farmers is 60, and there appears to be limited interest in the next generation engaging?
Farmers in Wales, Scotland and the rest of Europe continue to enjoy much higher levels of financial support. Even the great prairie farmers of the US enjoy heavily subsidised crop insurance and the massive ethanol blending mandate supporting corn prices. Where are the hedgerows, wild birdseed belts and woodlands on these prairies, protecting and enhancing the environment? How does the Minister expect our farmers to be able to provide competitively priced food, protect and enhance the environment, and provide all the other public goods, as well as supporting their families, when the Government slash support and environmental payments at a moment’s notice?
In answer to my question on Monday in your Lordships’ House, the Minister said that diversification and improvements in the environment are two of the three central pillars of the 25-year road map that the Government are developing for farming. Cutting SFIs at a moment’s notice seems a strange way to demonstrate that commitment. My question was about how nature restoration levies in the Planning and Infrastructure Bill as drafted will go to Natural England, rather than farmers and landowners, and be used for developing its environmental development plans, potentially on land that it will compulsorily purchase. This is a prime opportunity for the Government to help farmers diversify and supplement ELMS. Why does the Minister not want this opportunity to be offered to farmers?
I am pleased to see that the party to my left have followed my regret amendment by tabling a fatal amendment. It is good to see noble Lords from many, if not all, Benches working together to support our farming community. As is the long-standing custom of this House, we on these Benches will not support the fatal amendment. In this case, this would undermine the Government’s power to control their finances and, as the Minister rightly pointed out, undo the previous transition from delinked payments to ELMS. However, I strongly urge the Minister and all members of her Government to understand the terrible position this SI is putting many farmers in, and to act quickly to help those affected. Either moderate the impact of this SI or reinstate the existing SFIs. I intend to test the opinion of the House.
Lord Cromwell (CB)
My Lords, I declare an interest in this matter, as I have been involved in UK agriculture for my whole life. Normally, I try to be helpful and even occasionally to inject some humour into my remarks—with varying degrees of success, admittedly. But I am sorry to say that, tonight, I am cross—not with the Minister, for whom I have great respect and indeed affection. But the fatal amendment and regret amendment in the names of the noble Baroness, Lady Grender, and the noble Lord, Lord Roborough—which they have so devastatingly put to us tonight—highlight the frankly chaotic and opaque financial position for UK agriculture. SFI, Defra’s flagship scheme, ran out of money and slammed shut without any warning. The House of Commons Minister called this a “cause for celebration”. I wonder what would happen if DWP ran out of money and tried announcing something like that to the House.
The Minister mentioned the existing higher-level stewardship agreements, of which my family holds one. These were acknowledged by the Defra House of Commons Minister as having punitively low rates, and it was announced weeks ago that these would be updated before now, but nothing has been heard since. I am afraid that the Minister was wrong when she told us earlier that they have been increased. I have just checked the Defra website, which says that we agreement holders will be written to “by April” with increased rates. I ask noble Lords to check their diaries: today is 30 April, and nothing has been received.
The next iteration of the SFI, we are told, will be after the spending review, which probably tells us all we need to know about it. Meanwhile, the accepted tapering down to zero, over time, of payments under the BPS, as UK agriculture exited EU support, has been out of the blue cut by a totally unexpected 76% for smaller farmers—all of this while speechifying about environmental schemes, food security and a grand-sounding 25-year plan for UK agriculture, which no farmers I have spoken to have even heard of.
I am sorry to say this, but Defra’s credibility—and I have been involved in agriculture my whole life—has never been lower in the eyes of the sector it is supposed to support, and what little trust remained has now evaporated. All that said, while these Motions are both accurate and justified, I shall, given my involvement in the industry, with great sadness abstain if they are put to the vote.
Lord Roborough
At end insert “but that this House regrets that they reduce the delinked payments to farmers at a faster rate than previously expected, undermining the viability of farm businesses and harming rural communities.”
Lord Roborough (Con)
My Lords, I will be very brief. I also thank all noble Lords who spoke in this debate. Like others, I have sympathy with the Minister as there were so few words in support of this SI. I think most of us also agree with the noble Lord, Lord Rooker, that perhaps it is more to do with the Treasury; I note that her noble friend, who makes many of these decisions, is sitting in his place.
The noble Earl, Lord Russell, gave some examples decades ago of when my Benches may have supported fatal amendments. That was decades ago. It is a long-standing custom not to support fatal amendments. This is about responsible opposition. I would also note that our regret amendment has been tabled for several weeks, in contrast to the fatal amendment which appears to have been put down relatively recently.
I have put forward constructive ideas that this Government can adopt to moderate this SI or reintroduce SFIs. I hope the Benches on my left will support our regret amendment and send a clear message to the Government to consider these. I would like to test the opinion of the House.
Thames Water: Bids
Lord Roborough Excerpts(1 week, 1 day ago)
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Baroness Hayman of Ullock (Lab)
Obviously, water privatisation happened quite a long time ago now, which was when different foreign states came in and invested in our water system. I am sure the noble Baroness is very aware of the work going on through the Cunliffe review at the moment in order to try to get our water companies into a better state. The Government are very keen that we sort out the problem with Thames Water, but that is Ofwat’s and the company’s responsibility at present and we are just watching to ensure that Thames Water does not fail, because we cannot afford to have water companies failing.
Lord Roborough (Con)
My Lords, can the Minister, in light of the depressing state of British Steel, inform the House whether shareholders from any particular geographies would be excluded from investing in or controlling our water industry?
Baroness Hayman of Ullock (Lab)
I am afraid I cannot specifically answer that question. I am very happy to go away and look into it for the noble Lord.
Farming: 25-year Road Map
Lord Roborough Excerpts(1 week, 1 day ago)
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Baroness Hayman of Ullock (Lab)
I suggest that we have answers on a postcard.
Lord Roborough (Con)
I refer the House to my entry on the register of interests as a farmer. Part of the new deal for farmers, published in January by the Secretary of State, was to diversify income streams for farmers. The Planning and Infrastructure Bill, as drafted, will divert nature restoration levies away from farmers to Natural England. Can the Minister explain to your Lordships’ House why this should not be taken as a reduction in diversification opportunities for farmers?
Baroness Hayman of Ullock (Lab)
As I said, food production, diversification and improvements in the environment are the three central pillars of the road map that we are developing—we are extremely keen to ensure that diversification is part of it. One problem that many farmers have faced in the past is not being able to get through the planning applications that are so critical to diversification. Again, that is something that we are looking at as part of our reform of the planning system.
Farming and Rural Communities
Lord Roborough Excerpts(1 month ago)
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Lord Roborough
To move that this House takes note of the impact of the Government’s economic and planning measures on farming and rural communities.
Lord Roborough (Con)
My Lords, I draw attention to my interests as a dairy farmer; landowner; forester; natural capital, residential and renewables developer; and investor in natural capital businesses Cecil, Circular FX and Agricarbon and other farming-related businesses such as Deere, SLC Agricola and Anglo-Eastern Plantations. I am most grateful to my parliamentary party for making the plight of farmers and rural communities a top priority and allowing time for this debate today.
The list of negative spending and taxation decisions by this Government on farming and rural communities is long. The cumulative impact is devastating on the financial and mental well-being of farmers in particular but also the wider rural community. The reduction in inheritance tax reliefs under agricultural property relief and business property relief remains a hugely emotive and damaging subject. We remain puzzled why this was necessary, given that the Treasury expects to raise only £500 million per annum, and it will be only a transitory gain as tax-planning options remain open to reduce or eliminate this exposure, as Government Ministers have themselves conceded.
A small cohort of currently elderly farmers, sufferers of serious illness or victims of mortal accident will be caught by this capricious decision. There is a high risk that those who reasonably assume that they would not live either for the seven years needed to time out potentially exempt transactions, or even the four and a half years until the next election, will take the timing and manner of their death into their own hands. I have asked repeatedly whether the Government will keep and publish timely data on suicides by farmers and family business owners in the run-up to the reduction of these reliefs and have received a negative response each time. Will the Minister review this denial?
It seems particularly cruel that the £10 million mental health support fund for farmers has been shelved, despite the noble Lord, Lord Livermore, suggesting that mental health support is there for farmers should they consider taking control of the timing of their deaths. The massive reduction in delinked payments, which will be subject to a regret Motion later this month, as well as the abrupt closure of the sustainable farming incentive scheme, leaves many farmers in a dreadful position. Those who were trapped in the long-term higher-level or Countryside Stewardship schemes and unable to access sustainable farming incentives are hit with the delinked payment reduction without any offset. Those who were counting on new SFI income this year to replace old schemes that had ended are even harder hit. This does not appear to be a way to run a Government, whereby decisions are made that lead to considerable unfairness in outcomes and the unlucky lose financial viability.
In answer to my Written Question, the Minister replied:
“We remain committed to investing £5 billion of funding in the farming budget this year and next … We are on track to spend all the funding that is available”.
This seems hard to square, given that the National Farmers’ Union estimates that £400 million was saved by the steep reduction in delinked payments, yet only a few months later SFIs are cut off at a moment’s notice. Evidence given to the EFRA Committee by Defra Ministers and officials appeared to suggest a deliberate intention to ignore the six weeks’ guidance. Can the Minister also assure us that the £200 million investment in the Animal and Plant Health Agency’s Weybridge laboratory is not coming out of the farming budget? I wonder whether she is also able to tell us how much of that farming budget actually ends up in the hands of farmers, not in administration or projects run by others, and not in infrastructure nor arm’s-length bodies.
The £100 million rural service delivery grant being redirected to deprived urban areas, despite the widespread rural issues and the higher cost of living in rural areas, perhaps signals where this Government’s focus is. Farmers are having to contend with these capricious decisions and their often life-changing impacts while also dealing with massive inflationary pressures, low grain prices and increases in employers’ national insurance contributions and minimum wages. It has been suggested by the Government that the new SFIs that are planned are likely to require the land use framework to have been published. The Minister has indicated in a reply to my Written Question that
“the publication of the Land Use Framework”
will be
“this year. A timeline for publishing the Land Use Framework will be set out in due course”.
Could she confirm whether the publication of that framework will be necessary prior to the publication of new SFIs and what that might mean for their timing? A department official has suggested in front of the EFRA Committee that details of future SFIs would be with us in July. Can she confirm that?
The second prong of the attack on farmers and the rural community comes from planning, whether by displacing agricultural production on prime agricultural land with solar farms and other energy infrastructure, or the enhanced compulsory purchase order powers in the Planning and Infrastructure Bill. We on these Benches are broadly supportive of the Government’s housing ambitions, but there is no reason why they need to come at the expense of the rural community.
Land-owning farmers are threatened with compulsory purchase of their land at values that do not represent market value, as the value of alternative uses will be disregarded. Taking part of a holding often undermines the viability of the whole and, while the price paid may reflect the agricultural value, that is unlikely to be enough to replace that land locally—even if such land is available. It is hard to understand what is wrong with the current valuation framework that ensures fair payment for land. It is also hard to understand how this can be consistent with the ECHR on confiscation, as the Government claim on the face of the Bill.
Further to this, the role of Natural England becomes terrifying. As drafted, the Bill confers enormous powers on Natural England to CPO whichever land it chooses to fulfil its environmental delivery plans. Why does Natural England need these powers? Why can it not simply offer to pay landowners to carry out the work or deliver the services that are intended in these EDPs? Surely, there is a choice of sites where such work can be undertaken and that can introduce competition in service delivery while allowing value to be delivered in the EDPs. I fail to understand how nature restoration levies can possibly be well used by Natural England to CPO land as it sees fit. It has not been necessary to nationalise sites of special scientific interest to protect them. Just how large should we expect these nature restoration levies to be?
We on these Benches fundamentally believe in reducing the size of the state. However, capricious short-term spending and taxation decisions are not the way to do it. We want to see a vibrant rural economy, financed by fair payment for the public goods being delivered, as well as the traditional food and timber outputs from rural land. We see numerous ways of delivering this—but without killing the patient before the cure is administered by withdrawing funding before a replacement is available.
When will the Government make a decision on the inclusion of woodland carbon units in the emissions trading scheme? The noble Baroness has previously said “in due course”, but the consultation was launched last summer and surely cannot be very complex. The additional financial incentives would encourage new tree planting to meet and even exceed targets. Our climate is perfect for healthy, vigorous establishment and growth in trees. Our target of 16.5% tree cover, as I have previously said from the Back Benches, is unambitious, and our progress even to that is very disappointing. Trees capture significant quantities of atmospheric carbon, replace high-carbon emissions materials in building, reduce peak flow rates in flood events, help to purify water and benefit biodiversity. Surely, we must do everything in our power to increase this tree cover. The Government’s own chief executive officer of the Forestry Commission, Richard Stanford, eloquently explained these benefits to the APPG on Forestry and Timber Security, as did the Woodland Trust team to the APPG on Woods and Trees.
When can we expect mechanisms to allow water companies to pay for the flood mitigation and water quality improvements that regenerative farming, peatland restoration and new woodland planting deliver? When will action be taken to solidify the strong position of the woodland carbon code and the peatland carbon code by certifying them under the Integrity Council for the Voluntary Carbon Market? How will the Minister incentivise the private sector to pay for nature restoration and biodiversity protection and improvement? Surely the planning Bill is a golden opportunity to move forward on this, beyond our own biodiversity net gain measures on a larger scale. Why are we squandering this opportunity by giving it to Natural England? Would the Government consider tax incentives to encourage private investment in nature restoration, or even changing the rules on bidding for government contracts to require companies to invest in it?
Farmers and the wider rural community deliver unquantifiable value to our country; feeding us, protecting and restoring nature, sequestering carbon, growing timber to displace the 73% that is currently imported, protecting our archaeology, looking after our fresh water, maintaining our countryside for access and removing litter. Most of these public goods are not paid for at anything like their true value—if at all. This is simply not sustainable for the rural community. For the farming and rural community to move forward with confidence, existing spending commitments cannot be changed overnight and random new taxes imposed. The rural community needs confidence that this Government are committed to ensuring that these public goods will be paid for. I very much look forward to the insights of all other noble Lords in this debate and the Minister’s response. I beg to move.
Lord Roborough (Con)
My Lords, I am grateful to all noble Lords who have spoken in support of this Motion, and to the Minister for attempting to answer as many questions as she could in the time available. I look forward to her later answers to those that were missed.
I will summarise and highlight a few points. The noble Lord, Lord Davies of Brixton, made a very welcome contribution to the debate, but I take issue with his comments about inheritance tax on family farms and family businesses. Family businesses are the lifeblood of our economy. Without them, we would not have Pearson, Rolls-Royce, GKN, Tesco, Marks & Spencer, Whitbread, Sainsbury et cetera. Large businesses start as small businesses, and they are started by individuals and families. At the moment, we have companies like Dyson and JCB, which are private companies and are thriving.
We on these Benches want fair treatment for all family businesses and to allow them the chance to compete effectively with public and overseas companies so that they can grow into future champions of our economy. Having to be prepared at all times to pay a 20% IHT charge, as well as funding the dividend tax liability on that, is highly damaging. I would go further than my noble friend Lady Shephard and others—all family businesses, including farms, need these reliefs to thrive.
My noble friend Lord Grayling made a powerful case that it is absurd, when we have so much land that is not the best and most versatile, that the Secretary of State for Energy continues to permit so much solar development, in particular on this best and most versatile land. I also completely agree with him that housing development should be prioritised on brownfield land before greenfield is taken.
A number of noble Lords spoke about the disparity in opportunity, healthcare, et cetera, between the rural and urban environments. I particularly noted the powerful discussion of the noble Lord, Lord Kakkar, of access to emergency and chronic healthcare, and the right reverend Prelate the Bishop of St Albans highlighting the productivity gap between the rural and urban environments. The noble Lord, Lord Elliott of Ballinamallard, highlighted the planning constraints on livestock farms in Northern Ireland that make it so difficult to improve animal welfare and allow for better management of animal waste. It was encouraging that the Minister mentioned ongoing work to allow farmers to do more on the planning front to support their businesses. I hope the Government will consult widely on that.
The right reverend Prelate the Bishop of Hereford summed up the mood in the countryside. There is an all-time low in morale, which means there is a huge opportunity for this Government to improve things. I hope that some of the suggestions raised in today’s debate will be taken forward. In the meantime, I beg to move.
UK Fishers: EU Agreement
Lord Roborough Excerpts(1 month ago)
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Lord Roborough
To ask His Majesty’s Government what plans they have to improve outcomes for UK fishers after the current agreement with the European Union expires.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)
My Lords, after the end of the fisheries adjustment period set out in the trade and co-operation agreement, European Union access to UK waters, and vice versa, become a matter for annual renegotiation, as is typical between coastal states. We know that the EU wants a new multiannual access agreement. We will listen to what it has to say and will work tirelessly to achieve the best possible outcome for the UK economy and coastal communities.
Lord Roborough (Con)
My Lords, there have been alarming reports in the press that our European friends seem intent on securing and even improving their access to our exclusive economic zone fisheries ahead of any negotiation of other issues. Can the Minister confirm that this Government will not only defend but substantially increase the quota position of our fishermen in our waters ahead of the 26 June deadline?
Baroness Hayman of Ullock (Lab)
Clearly, as a Government, we will always push for the best opportunities for our fishers and the fishery industry. We would like to see long-term strategies to provide the industry with greater stability, which is important to it. At the same time, it is important that we always follow scientific advice when developing negotiations and catch limits.
Sustainable Farming Incentive
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Lord Roborough (Con)
My Lords, I first declare my interests as set out in the register, in particular as a dairy farmer. I thank the Minister for repeating this Statement in your Lordships’ House and for allowing an opportunity to scrutinise the decision to cap sustainable farming incentives in this manner.
We on these Benches are proud of the Environment Act 2021 and of the transition in farming support payments to environmental land management schemes. ELMS is a crucial step in fulfilling our legally binding commitment to achieve a 30% recovery in nature by 2030, as well as ensuring that farming payments are for public goods. To cap the sustainable farming incentives with no notice, despite the Government’s own website informing that up to six weeks’ notice would be given for withdrawal of SFIs, is a betrayal of our farmers and our natural environment. Many were already facing unexpected financial hardship from the massive reduction in delinked payments, planning for the reduction in IHT reliefs, the increased minimum wage and national insurance contributions. This adds more pressure to those who were expecting to transition to SFIs this year but had not yet applied. Fewer than half of farm holdings that were in the basic payment scheme have SFIs.
The NFU’s farmer confidence survey shows farmer confidence in England and Wales at its lowest level ever. Some 88% of farmers believe the phase-out of direct payments will negatively affect their business, and 51% of farmers were planning to use ELMS to mitigate that phase-out. These dramatic changes in government support with no notice upset any attempt at budgeting, with costs already largely set for this year based on revenue projections that have now been dramatically cut. This will cause significant further hardship and heartache.
What assessment has been made of the impact of the SFI announcement on the financial viability of the farming industry? How many farms are likely to be pushed beyond breaking point this year? Has the estimated £400 million being cut from delinked payments been fully reallocated to the environmental land management schemes? Do the Government still intend to open the Countryside Stewardship higher tier this summer as previously committed to? In regard to the environment, what impact will the SFI decision have on compliance with the legally binding commitment delivered in our Environment Act to deliver improvements in biodiversity and nature recovery, given the central importance of farmers and land managers in achieving this?
Government messaging about the timing of new SFIs has been muddled, mentioning both 2026 and 2025 and it being potentially contingent on the finalisation of the land use framework. Please could the Minister be clear today on exactly when farmers will be given access to new SFIs and how their emphasis will differ from existing SFIs? Can the Minister also confirm that the £5 billion budget settlement for farming remains intact and will be fully distributed over the years ending in 2025 and 2026?
Given this Government’s disappointing financial decisions relating to farming and the wider rural economy, it would also be helpful if the Minister could enable us to understand what role she sees for private sector finance in replacing the public purse in land management. ELMS is an important segue into that, identifying valuable natural capital activities in land management, which in turn can morph into quantified public goods. In order for the private sector to step in, we need to see financial incentives. What financial incentives would the Government consider appropriate to deliver this investment? Will the woodland carbon code and peatland carbon code be admitted into the emissions trading scheme, creating real market demand? Will tax incentives be considered, or public bidding rules? Finally, could the water industry play a greater role in financing nature-based projects for reducing peak flow rates and flood events, and improving water quality?
The farming community needs help to plan after so many blows; I hope that the Minister can help with her answers.
Baroness Grender (LD)
My Lords, I thank the Government for the Statement. They will no doubt by now be aware of the significant disappointment and dismay the sudden closure of this scheme, without consultation or warning, has caused. What analysis did the Government do before this announcement to establish the likely impact on smaller farmers such as family farmers and those on significantly less than the minimum wage? Were there impact assessments in respect of farmers losing their basic payment this year with the immediate removal of SFI, and without, as yet, any clear replacement scheme?
Can the Minister please share with us the expenditure implications? It is our understanding on these Benches that if the BPS cuts this year are taken into account, more than £400 million of the £2.5 billion farming budget will remain unspent. Given that this was a budget intended to reward farmers for nature restoration and sustainable food production, can the Minister reassure us that this will not damage both? Can she explain how the Government will ensure that key environmental work is rewarded, and carried out by farmers who can no longer get access to this funding?
Does the Minister accept that there is a danger that the larger landowners, the ones that are more corporate, are highly likely to have already taken up the SFI and be part of the 6,100 new entrants this year? What advice does she have for the smaller operators, some of Britain’s poorest farmers, who are now left behind? Is she further aware that only 40 hill farms were new entrants this year, and that the previous Government failed to provide sufficient support for hill farmers, which in turn led to an over 40% drop in hill farm incomes in just five years? Is there any plan to help the small farms, upland farmers and commoners affected by this sudden change?
Can the Minister share with the House any discussions with farming stakeholders in advance of this change? Stakeholders tell us there were none, and the NFU said that it had just 30 minutes’ notice.
Finally, will the Minister please share what steps the Government will now take to increase the farming budget to reflect the Government’s nature and climate targets? We would be very happy to share the suggestions in our own manifesto if that would be in any way helpful. These targets, we would argue, have been greatly damaged by this cut in SFI.
Biodiversity and Conservation
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Lord Roborough (Con)
My Lords, I declare my interests as set out in the register as a farmer, forestry developer, landowner, owner of fishing rights and investor in Circular FX, Cecil and Agricarbon, which provide services to the natural capital industry. I am most grateful to my noble friend Lord Grayling for securing this timely and important debate on the Government’s strategy for biodiversity and conservation. As Conservatives, we hold a deep-seated belief in our responsibility to preserve and enhance the natural heritage entrusted to us; that is why we brought forward the Environment Act 2021.
I must bring up the dreadful news on SFIs from Defra this week, as it impacts directly on the topic of this short debate: we expect farmers to deliver most of these improvements. Many were already facing unexpected financial hardship from the massive reduction in delinked payments, but this latest news adds many more who were expecting to transition to SFIs this year but had not yet applied. I ask the Minister: what assessment has been made of the impact of the SFI announcement on the financial viability of the farming industry? What impact will that have, in turn, on compliance with the legally binding commitment, delivered in our Environment Act, to deliver the 30% improvements in biodiversity and nature recovery? If incentives to benefit nature restoration and biodiversity largely target action by farmers and landowners, how can pausing them help?
The Government have committed to a nature restoration levy, which will possibly—I hope we will hear—replace the current biodiversity net gain system that we created. We on these Benches have grave concerns about its creation, as articulated by my noble friend Lord Grayling, and also about placing its administration with Natural England rather than with local authorities. How can the Minister reassure us that this will deliver better outcomes for nature?
Atlantic salmon populations have collapsed by over 75% in our rivers over the last 50 years, as evidenced by reported rod catches, and despite almost all fish being caught and released over recent years. The Atlantic salmon is a crucial indicator of the health of our river catchments and it is now on the IUCN red list. What specific measures will the Minister take to address water quality, pollution, selective restocking and habitat degradation in our rivers to support its and other species’ recovery? I urge the Minister to identify the salmon as a keystone species for biodiversity and nature restoration efforts. I hope that the noble Baroness, Lady Jones of Moulsecoomb, might agree with this strategy, given her comments on water quality. I note my noble friend Lady Helic’s comment that the hare is probably also a worthy inclusion as a keystone species to gauge the success of nature restoration.
I fully support the comments of my noble friend Lord Caithness: bracken can be a scourge, and it is depressing that its presence is so widespread in locations where we should really be planting trees in order to fulfil our strategy of restoring our woodland cover. My noble friend Lord Grayling mentioned the renegotiation of our TCA with the EU prior to mid-2026. I agree with his environmental comments and add that we also expect this Government to negotiate a deal that delivers complete zonal attachment in our exclusive economic zone for British fishermen.
Given this Government’s disappointing financial decisions, and as my noble friend Lord Courtown rightly highlights, we need more private sector finance to replace the public purse. It would be helpful if the Minister could help us understand what role she sees for private sector finance to replace public finance in biodiversity and conservation improvements. I very much look forward to the Minister’s reply to this short debate and the many questions posed, in writing if necessary.
Flood Reinsurance (Amendment) Regulations 2025
Lord Roborough Excerpts(1 month, 3 weeks ago)
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Lord Roborough (Con)
My Lords, I, too, thank the Minister for introducing this statutory instrument to ensure that flood reinsurance can continue to operate effectively. For that reason, His Majesty’s most loyal Opposition are pleased to support it. Although the measures are necessary, they raise several questions about the future of the Flood Re scheme and the Government’s broader approach to flood risk and resilience.
The flood reinsurance scheme established under the Water Act 2014 was designed to provide much-needed reinsurance for household insurers facing flood risk, ensuring the availability and affordability of flood insurance for properties at risk of flooding. This initiative, introduced by the previous Conservative Government, remains a crucial safety net for many home owners across the country. It has offered vital support as we face increasing flood events that threaten the stability and safety of homes across Britain.
However, we must recognise that the scale of flooding is rapidly increasing. Recent assessments by the Environment Agency indicate that approximately 6.3 million properties in England are at risk of flooding from rivers, seas or surface water. This is projected to increase to 8 million properties by 2050, reflecting the escalating threat posed by climate change and extreme weather events. This highlights the importance of ensuring that the Flood Re scheme is sufficiently robust to support the growing number of home owners at risk.
The statutory instrument proposes an increase in the total levy from £135 million to £160 million. The Government’s assessment indicates that this rise will likely be passed on to consumers, resulting in an estimated increase of £1.60 per household insurance policy. Although this increase may seem modest on an individual basis, it raises concerns about the cumulative effect on policyholders, especially those already facing higher premiums due to rising costs in other areas. This adjustment reflects the growing challenges the scheme faces in a world where extreme weather events are becoming more frequent and severe.
His Majesty’s Official Opposition acknowledge the necessity of this adjustment, given the financial pressures on reinsurers, driven by factors such as inflation, global natural catastrophe claims and the need to preserve the scheme’s financial resilience. If the rate and risk of household flooding continue to rise, can the British people reasonably expect these annual increases in insurance premiums to become the norm?
I have several other key questions for the Minister today. First, can she confirm whether the Government have consulted with industry stakeholders about the feasibility of expanding the Flood Re insurance scheme, particularly in high-risk areas and to houses built after 2009?
I am most interested in the Minister’s response to my noble friend’s question regarding farmhouses and buildings. Although these are likely to have been sited in less flood-prone locations, the Government have made significant commitments to building 1.5 million new homes in the coming years, a substantial increase on the recent rate of building completions. As my noble friend Lady McIntosh of Pickering highlights, how does the Minister intend to protect these new homes from flood risk, particularly those in high-risk areas? Will the Government commit to ensuring that all new developments are designed with flood resilience in mind?
Could the Minister confirm and explain the role she sees for nature-based solutions in the management of floods at a catchment level in future? Here, I declare my interest, as set out in the register, as the owner of land in a number of river catchments.
Finally, can the Minister inform us what progress is being made in the transition from Flood Re to risk-reflective pricing for household flood insurance when Flood Re expires in 2039? We are approaching midway in the life of Flood Re and it would be desirable to see some progress.
These are questions that go to the heart of the Government’s approach to flood risk, resilience and insurance. While we understand that the increase in the levy is a pragmatic measure in the light of global challenges, we must not overlook the broader implications of a changing climate and the evolving risks that flood-prone households face. With that, I look forward to hearing the Minister’s response to these questions.
Baroness Hayman of Ullock (Lab)
My Lords, I thank noble Lords who have taken part in this debate today. Personally, I was very pleased when Flood Re came in; I thought it was incredibly important legislation. Anyone who has lived in a house that has flooded, like I have, and in communities that flood, will know how very important it was that we had this insurance scheme come into place. I therefore thank noble Lords who have supported this small but extremely important SI today; it is important that the scheme stays viable and continues.
I would like to try to cover most of the questions that have been asked. There has been a desire for government to look at whether the scheme can be extended; that came across clearly from all who took part. Before I go into the particular individual responses and specifics, let me say that although we have no plans to make changes right now, we are continuously keeping all our policies under review, including those relating to flooding insurance. It is important that we discuss, debate and listen to others as we move forward in how we make those decisions around policy changes. If we make any changes to the scheme in future, it would be important that we secure the appropriate reinsurance for that, which would be challenging in the current market. To put it into context, this would mean that the levy we are talking about today would then need to be increased even further.
I know that noble Lords are aware that, currently, leasehold properties with three or fewer units, where the freeholder is living in one of those units, qualify for Flood Re building insurance. The problem with larger blocks not being eligible is that they are considered to be commercial businesses, and that is why they fall outside of the scope of Flood Re.
The Flood Re scheme as it is set up at the moment, and as it will continue to be set up through the statutory instrument in front of us, is funded by the providers of household insurance, not those who underwrite commercial policies. Buildings insurance is the responsibility of the freeholder and kept separate. However, I recognise that there is a problem.
When Main Street in Cockermouth flooded, for the second time in only six years, I held meetings with business insurance companies and high street businesses to look at ways we could move forward, because there are still alternative things that we can do and that the Government can look to support.
Having said all that, and with properties built after 2009 having been referred to—the noble Baroness knows that that is something that I was concerned with—we are planning to explore this further. Minister Hardy, who is the Minister responsible for this area, has asked Flood Re to look into the matter to understand the scale of concern and how industry might respond, to ensure that those living in properties that currently do not come under the scheme could be provided with appropriate insurance cover. Although it is not in front of us today and not something we are actively looking at, we have asked for this to be considered further. In the meantime, contents insurance policies can be applicable, so there is that potential as well.
High Seas Treaty
Lord Roborough Excerpts(1 month, 3 weeks ago)
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Baroness Hayman of Ullock (Lab)
The key thing that we are doing around bottom trawling is looking specifically at the areas that are most important and need conserving the most. When we look at making agreements with other countries, that is clearly an important consideration, because there is no point in designating somewhere a marine protected area if we do not look carefully at which parts need protecting the most and ensure that damage does not take place. It is good that we have 60% of our MPAs protected, but, clearly, we need to move forward and do more.
Lord Roborough
My Lords, I am sure all noble Lords have seen the potentially tragic news of a serious shipping accident off the Yorkshire coast this morning. I know I speak for all noble Lords in expressing our sympathies and support for the crew, the emergency services and their families. Can the Minister share with the House the nature of the product being carried on the tanker, what risks this poses to the public and the marine environment, and what steps the Government are taking?
Baroness Hayman of Ullock (Lab)
I thank the noble Lord for raising this issue. I am sure that we were all extremely shocked and concerned on hearing about the collision that has just taken place in the North Sea. It is an emerging picture; we are still hearing more evidence as to exactly what has happened. I assure the House that we are speaking closely in Defra to the Department for Transport and the Maritime and Coastguard Agency, which are leading on the government response. They are assessing the situation, as it has only just happened. I assure the noble Lord and the House that Defra’s agencies including the Environment Agency are engaging on any clean-up that is needed and assessing any pollution. We are not sure at the moment exactly what the situation is. There has been a fire, which makes it much more difficult to look at the extent of damage and pollution. We will keep the House updated as we hear further information.
Beaver: Reintroduction in England
Lord Roborough Excerpts(2 months, 1 week ago)
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Baroness Hayman of Ullock (Lab)
I completely agree with my noble friend. The Government condemn any illegal release of beavers. They not only are unlawful but, as she said, can lead to damage and conflict, and they undermine legitimate releases. Just to confirm, it is an offence in England under Section 14 of the Wildlife and Countryside Act 1981 to release a beaver into an enclosure or the wild, except under the authority of a licence from Natural England. Regarding penalties, doing so without a licence carries a penalty of either an unlimited fine or up to six months in prison.
Lord Roborough (Con)
My Lords, I refer the House to my entry in the register of interests, in particular as a host to an illegally released beaver—not by me. As the Minister pointed out, the reintroduction of beavers to the UK may well have a role to play in managing waterways and reducing the risk of flooding. We have discussed nature-based solutions in this House before on the then Water (Special Measures) Bill, and I would be most grateful to the Minister for an update on progress on nature-based solutions within the water sector.
Baroness Hayman of Ullock (Lab)
The noble Lord is absolutely right. The Government are very serious about this. Nature-based solutions will be incredibly important if we are to get the outcomes and results that we want. We are continuing to make progress, and I am happy to keep the noble Lord updated as that progress continues.