This Is A Policy Choice About Which Farms Count
This is how you lose local veg, local jobs, and nature friendly farming, quietly, in the fine print
The Story You Are Being Sold
If you have been watching the UK news, you might have seen the protests and assumed this is mainly about inheritance tax. That is part of it.
Farmers have been protesting the inheritance tax changes, and many are still protesting even after the small adjustments that were meant to calm things down. But there has been another blow since then.
A few weeks ago, Defra published the latest update to the Sustainable Farming Incentive, the main scheme in England that is meant to pay farmers for environmental work.
This is where the news coverage often falls short. It tends to flatten everything into one story, as if all farms are the same and all farmers are angry for the same reasons.
They are not. These changes affect all farmers, but not equally.
Not all farming systems are treated equally by policy, and the most damaging effects fall mainly on smaller scale, high welfare, agroecological, nature friendly farms. That matters for consumers, because these are often the farms trying to produce food in ways that protect soils, wildlife, water, and animal welfare.
The Simple Version
In England, the main post Brexit farm payment scheme is the Sustainable Farming Incentive, or SFI.
Defra has just announced a new version for 2026, and it is being sold as a reset after last year’s chaos.
But the loudest signal in the fine print is that government is trying to control the budget by controlling who gets through the door.
There is a priority application window for smaller farms, and the biggest claims will be capped. At the same time, farms and growers under 3 hectares are excluded entirely.
That is not a technical tweak. It is a policy choice about which kinds of farming count.
What SFI Is Meant To Do
SFI is a government payment scheme in England that pays farmers to do specific environmental actions on their land.
In theory, it is a simple trade. Government sets out a list of actions it wants, farmers choose what fits their system, and payments help cover the cost of doing that work.
The actions are meant to deliver public goods, things like healthier soils, more wildlife, cleaner rivers, and lower chemical use.
The problem is not the idea. The problem is that the scheme keeps changing while farm businesses are expected to make multi year decisions, and that the rules increasingly favour the farms with the most land and the most admin capacity.
What Changed, And Who Gets Shut Out
Here are the main updates:
The new offer will have 71 actions, down from 102. There will be two application windows, June 2026 for smaller farms (defined as 3 to 50 hectares) and for those not currently in a live ELM revenue agreement, and September 2026 for everyone else.
Total agreement value will be capped at £100,000 per year. Some arable payment rates will be reduced.
Moorland actions will see increased payment rates, and the uplift will apply to existing agreements that already include those actions.
A minimum 3 hectare eligibility threshold has been reintroduced, which means farms and growers operating on fewer than 3 hectares will be excluded.
Why 3 Hectares Is Not “Small” In The Real World
If you have never farmed, 3 hectares might sound tiny, and it is.
But it is also big enough to include a lot of serious small farms, and big enough to exclude a lot of market gardens, community supported agriculture farms, and small mixed holdings.
These are often the farms that grow vegetables, employ local people, raise high welfare livestock, and sell direct to the public. They are also the farms that tend to deliver the kind of environmental outcomes the scheme claims to want.
So when government excludes them, it sends a message that small scale food production is not worth the paperwork.
That is why people are angry, because it suggests the system is being designed around what is easiest to administer, not what is most valuable for food resilience.
The Trust Problem
Farmers are being asked to make multi year decisions about rotations, stocking, tenancies, and investment. But the scheme keeps changing.
Last year, SFI was suddenly closed when many people were still preparing applications. Now Defra is trying to prevent another sudden closure by using application windows.
That might help, but it does not guarantee funding. Some groups are warning that the scheme still creates jeopardy because it remains first come, first served.
There is also a very practical issue. The current SFI IT system cannot accept an SFI26 application on land that is still under an active agreement, which can create gaps in income and environmental delivery for farms whose existing agreements expire out of sync with the new windows.
If you are a consumer, here is the translation:
You cannot build a stable food system on a scheme that feels like a scramble for a limited pot.
