Jan 2022 • 2 min read

DEFRA outlines Local Nature Recovery and Landscape Recovery Schemes

As part of the new farming policies, George Eustice presented to the Oxford Farming Conference on the 6th January 2022, two new Environmental Land Management Schemes for England that are to be in place from late 2024:
• Local Nature Recovery (LNR)
• Landscape Recovery (LR)

Although they are not limited to agricultural land, these new schemes would sit alongside the Sustainable Farming Incentive (SFI). An announcement on the SFI was made in December 2021 which focussed on soils. There are more details to follow.

Later SFI options (2022) will include integrated pest management and hedgerows but will see SFI as assisting wider environmental achievement over the landscape in conjunction with farming.

Stressed as voluntary options for farmers and landowners, these new schemes are to be focussed on creating and restoring habitats as part of the Government’s aim of reversing species loss by 2030 and meeting targets to be set under the new Environment Act.

George Eustice accepted that LNR and LR would not be right for all, indeed for many, farmers, being a “particular choice” for some – SFI is to be the offer to all farmers who continue farming.

When they are in place, these two schemes are expected to take 60 per cent of the present support finance that has been carried forward from the CAP, SFI taking another 30 per cent and productivity schemes 10 per cent.

The stated aspiration is for LNR and LR to help restore up to 300,000 ha (750,000 acres) of wildlife habitat by 2042 – were that all to be farmland, that would be some 3.3 per cent of England’s Utilised Agricultural Area.

However, with the ambition for SFI to attract 70 per cent of farmers and 70 per cent of farmland, that points to intending 30 per cent of the present money to be spread over some 67 to 70 per cent of farmland under SFI with its more traditional agri-environment scheme approach and works that can be done while farming.

The approach to pricing these schemes will build on the more open policy set out in DEFRA’s Payment Principles paper of June 2021.

George Eustice emphasised that payments for these schemes (and the new rates for Countryside Stewardship) would not be based on the EU’s compensatory income foregone approach but are to be made attractive. The Government now has legally binding environmental targets, including for species abundance, that require willing take up at scale and so the pricing will be set to achieve that.

However, in that and alongside needing value for money, it will be seen below that there is a clear intention not only to avoid public money crowding out private money but positively to encourage private financing of environmental improvement and management, to “crowd-in” private money.

As well as developing the new schemes, DEFRA is to come forward with proposals to “streamline and simplify” the regulation of agriculture, targeting outcomes and with proportionate controls and penalties. More detail is to be published in “coming weeks”.

The Objectives While not perhaps fully delivering on the objectives of the 25 Year Environment Plan, the currently stated objectives for the Environmental Land Management Schemes (ELMS) are:

•To bring up to 60 per cent of agricultural soils under sustainable management by 2030
•To reduce agriculture’s greenhouse gas emissions, here as by reducing fertiliser
•To treble woodland creation by 2024 and restore up to 200,000 ha of peatland by 2050
•To halt the decline in species, including birds and insects, by 2030
•To reduce the main agricultural pollutants entering watercourses, helping targets for cleaner water
•Restoring rivers, lakes and other freshwater habitats.

Local Nature Recovery

LNR is to pay farmers for changes on the farm, particularly on parts of a farm, that “make space for nature” by offering a range of options including those tailored to specific types of area, such as:

•Managing and creating wildlife habitats
•Adding trees to fields and hedgerows
•Restoring peat and wetland areas
•Restoring coastal habitats.

Agreements would be for several years, varying with the activities to be undertaken. There is to be the freedom to add options or land over time. While agreements are to be with individual farm businesses, LNR is also to encourage collaboration or co-ordination between farmers. This is likely to be supported by a facilitation offer, drawing on lessons from the experience of the Countryside Stewardship Facilitation Fund. It is presented as building on the Countryside Stewardship Scheme as it has been reformed since Brexit.

Countryside Stewardship was described by George Eustice as now “a bridge to Local Nature Recovery” with payment rates for revenue options now reviewed and many increased for current and future agreements. LNR is to “dovetail” with private schemes and markets for accredited results, attracting private finance through biodiversity net gain, nutrient trading or carbon agreements.

It would include options for reducing run-off for farmland, mitigating flood risk by installing flood reservoirs, restoring peat or wetland areas, and adding trees and hedgerows to fields.
An early version is to be tested in 2023 ahead of it being fully available from later 2024. The tests are expected to involve up to 500 people.

It is to be open to farmers alongside an SFI agreements, provided the actions are compatible and the same actions are not being paid for twice. Both schemes are to be operated from 2024 through a single website portal, so with a unified application process.

DEFRA proposes to provide a smooth transition for people in existing Countryside Stewardship agreements to LNR agreements from late 2024.
Priorities are to include:
•Reversing the decline in biodiversity
•Improving water quality
•Moving toward net zero greenhouse gas emissions
•Developing the resilience of the environment to climate change
•Improving air quality
•Natural flood management
•Mitigating the risk of coastal erosion – heritage and access.
•The initial options for 2023 are to cover:
•Managing feeding, shelter and breeding areas for wildlife on arable farms
•Managing, restoring and creating grassland habitats such as species rich grassland
•Managing, restoring and creating wetland habitats such as ponds, lakes, reedbeds and fens
•Managing, restoring and creating lowland heathland
•Managing, restoring and creating costal habitats such as sand dunes, salt marsh and shingle
•Managing and restoring areas of upland and lowland peat and moorland
•Targeted support for recovery of particular species and tackling non-native invasive species
•Managing and creating trees and woodland, including agri-forestry, traditional orchards and trees (with EWCO the main scheme for woodland creation until 2025)
•Nature-based solutions for water with in-field vegetation, buffer strips and swales
•Restoring rivers, flood plains, streams and riparian habitats.

Work is to be done to tailor the options for SSSIs, including how to move to LNR from existing agreements.

The rules regarding tenant farmers remain to be settled. LNR would be a “financial assistance scheme” under the Agriculture Act and so access to LNR could be a ground for a 1986 Act tenant to challenge a term of a tenancy or a refusal of consent with recourse to arbitration (under s.19A of the 1986 Act).

As with SFI 2022, agreements for common land would be with a single entity that is capable of meeting the commitments with authority to act on behalf of those involved.

More specific details on options, rules and payment rates are to be published later in 2022.

Landscape Recovery

LR is to offer agreements for longer terms (perhaps 20 years or more) to support “more radical changes” to land use with habitat and eco-system restoration “such as establishing new nature reserves, restoring floodplains, or creating woodland and wetlands”.

Projects would then have “long term safeguards”, such as conservation covenants (and so involving a “responsible body”), to protect them. Described by George Eustice as a “particular choice” for some owners, LR is to be open to individuals or groups who can deliver projects over areas of between 500 and 5,000ha across all types of land, including land in a current agri-environment scheme, SSSIs and common land, under any form of management.

A public body could be part of a consortium but not be able to apply separately. It is to start with pilots offered in two rounds over the next two years. The scheme focuses on these two themes:

•Recovering England’s threatened native species with recovery of priority habitats, habitat quality and species abundance
•Restoring England’s waterbodies, rivers, streams and flood plains to a more natural state, improving water quality, biodiversity and climate change adaptation with reduced nutrient run-off and improved flood mitigation.

With a view to creating 10,000 hectares of restored wildlife habitat, carbon savings and improving status of around half of the most threatened species in England, including the Eurasian curlew, the sand lizard and the water vole. The successful first round projects are to be announced this summer. The criteria for selecting schemes are to cover:

•Longevity
•The environmental benefits
•Carbon and climate resilience
•Social impact
•Public access, community engagement, etc
•Project leadership and delivery costs.

The second round of projects is to be in 2023. Selected projects will then be awarded development funding for more detailed planning, over up to two years, after which they would proceed to implementation with DEFRA and private funding of bespoke agreements.

The scale of these agreements is seen as potentially more attractive to the private funding that is expected to complement DEFRA’s funding. With that expectation, while DEFRA will fully fund the development phase, it then intends only to part fund the project as it is implemented. One task in the development phase will be to prepare credible proposals for partial private funding. One example might be where a water company sees this as a means to achieve a cheaper nature-based solution to improve water quality.

Because agreements will be bespoke, DEFRA is not intending to set out a list of possible actions with payment rates. Projects will nonetheless need to be good value for money. The rules regarding tenant farmers remain to be settled.

In practice, few tenants might be confident in entering an agreement with a 20 year or longer horizon and probable cross liabilities with others involved without their landlord’s active support, even before considering potentially fundamental land use change with its impact of the farming business and the covenants of the tenancy agreement. However, LR would be a “financial assistance scheme” under the Agriculture Act and so access to it could be a ground for a 1986 Act tenant to challenge a term of a tenancy or a refusal of consent with recourse to arbitration (under s.19A of the 1986 Act).