Agricultural Subsidy Budget Update

Thursday, 2 January 2020

No cut to subsidy budget in 2020, Treasury confirms

The total budget for area-based subsidies will be the same in 2020 as it was this year, the Treasury has confirmed today, with £2.8bn support pledged. This will be the first payment funded in full by UK taxpayers following the UK’s exit from the Common Agricultural Policy. This statement is in line with pledges made during the Dec ’19 election, which stated that the annual budget for agriculture will be matched to the current budget through every year of the parliamentary term.  

The exact payment rates a hectare would be decided later in the year by Defra and the devolved administrations, according to a government spokesperson.

Rural Development

Each part of the UK will set its own level of Direct Payments for 2020 under existing EU rules which enable up to 15% of the Direct Payments budget to be used for rural development.

Theresa Villiers, Defra secretary, said: “Outside the EU we will have a simpler, fairer funding system – one that rewards farmers for enhancing our environment and safeguarding our high animal welfare standards.

“We are committed to making sure our rural communities feel the benefits of Brexit and will ensure our farmers get a better deal.”

Phasing out of direct payments

It is predicted that phasing out of direct payments will not begin in the next 14 months, in England, as a requirement of the Agriculture Bill, previously delayed, to be passed is causing hold ups. In Wales, the government have already stated that payments will not be phased out until at least 2022.

If you would like to speak to one of our team in regard to your present subsidies and the likely changes the future will bring, in the first instance, please call your local H&H Rural office:

Atherstone – 01827 718021

Ashby – 01530 877977

Rugby – 01788 564680

Towcester – 01327 397979