English farmers face rapidly diminishing de-linked direct payments following further detail emerging from the UK Budget.

In AHDB's analysis, farmers in England will see thousands of pounds wiped from their support money unless they sign up to the new environmentally focused schemes.

De-linked payments, which replaced direct payments in 2024, are no longer based on a farmer’s landholding size. Direct payments have been on a gradual reduction path since 2021, continuing under the de-linked payment structure. This reduction is set to phase out completely by 2027, with details confirmed by Defra for further reductions in 2025.

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These reductions will be based on the amount each farmer received in 2020. Payments will be cut by 76% for the first £30,000 received. For any amount above £30,000, payments will be reduced entirely by 100%.

AHDB explained the example of a farmer who received £50,000 from direct payments in 2020:

– A 76% reduction would apply to the first £30,000, reducing it by £22,800.

– A 100% reduction would apply to the remaining £20,000.

– This means payments would be reduced to £7200 for 2025.

Defra notes that these reductions will make more funds available for environmental land management schemes, allowing a greater number of farmers to access support through these programmes.

With payments set to decrease further, AHDB is encouraging farmers to explore productivity improvements and alternative funding opportunities.

Analysis of the Sustainable Farming Incentive (SFI) scheme shows the potential benefits of stacking various SFI actions, which can boost farm profitability. Additionally, the levy body believes that insights into the practices of top-performing farms may offer helpful strategies for those seeking to strengthen their financial resilience.