Can Cumbrian Hill Farmers Afford to Lose Income?

“The Hill Farming Allowance (HFA) is being replaced this year by the Uplands Entry Level Scheme (UELS). To avoid a gap in payments farmers should apply for UELS as soon as possible.” Application packs are likely to be available from February with the first agreements going live in July.

The introduction of UELS represents a significant shift in the emphasis of hill farming support towards environmental considerations.

UELS is open to all farmers and landowners with land in the Severely Disadvantaged Area (SDA) and acceptance is guaranteed, as long as the scheme requirements can be met. UELS is effectively an “add-on” to the standard Entry Level Scheme (ELS); farmers must apply for both ELS and UELS within one application.

Farms will have an area-based points target for ELS and UELS together. The target can be reached by choosing from standard ELS options and a range of new UELS options. UELS options include points for hedge and wall restoration as well as increased points allocations for moorland wall maintenance and cattle grazing. Annual ELS/UELS payments are £62 per hectare on SDA land and £23 per hectare on Moorland parcels over 15 hectares.

Farmers with an existing ELS agreement will need to replace it with a new 5-year ELS/UELS agreement. Higher Level Stewardship (HLS) agreements will need to be altered to gain the extra points required for UELS. In some cases, this could be difficult to achieve without reducing the income from the HLS part of the agreement.

Farmers with Environmentally Sensitive Area (ESA) or Countryside Stewardship Scheme (CSS) agreements cannot apply for UELS on the same land. Instead, they will need to apply for the Uplands Transitional Payment (UTP) – an HFA-style payment to be claimed annually until the ESA/CSS ends. Things are more complicated when a holding has some land in ESA/CSS and some in ELS. Farmers face a choice between applying for UTP across the whole farm or applying for UELS on land that is not covered by ESA or CSS.

Farmers with common rights may face the biggest challenge in maintaining their income. Historically, individuals have claimed HFA in relation to their common rights. Under UELS, however, the entire common will need to be entered into the scheme, with payments being made to a commons association, rather than directly to individuals. UELS pays for the delivery of environmental benefits, so payments are targeted at active graziers with hefted self-replacing flocks.

A legal agreement will be required to set out how payments will be split between commoners – negotiating this can be complex and expensive, requiring specialist advice. To reflect this, UELS agreements on common land will pay an additional £5 per hectare per year. Where a common is already in an ESA/CSS agreement, individual graziers should be able to claim UTP in relation to their common rights until that agreement ends.

If a common is not currently in any environmental agreement and there is no commons association, it is imperative that one is formed, if the graziers want to continue to receive hill farming support. This can be a complicated process. The common itself may not be on the Rural Land Register, which must also be addressed before a UELS application can be made.

“There are some difficult decisions for hill farmers to make and the right choices will depend on individual circumstances”, concludes Morley. “Farmers and landowners need to take professional advice to ensure they choose the right options for their business and they don’t lose income.”