The Spending Review: 'Farmers will be breathing a sigh of relief' as farming left out of Chancellor's speech

CLA issues cautious welcome as Defra reveals new agriculture budget plans

Alex Black
clock • 3 min read
The Spending Review: 'Farmers will be breathing a sigh of relief' as farming left out of Chancellor's speech

Food and farming failed to appear in Chancellor Rachel Reeves' Spending Review address today (June 12), although it is believed Defra has secured a ‘strong financial settlement'.

Despite fears the farming friendly budget was to be slashed, Defra has revealed Secretary of State Steve Reed has negotiated a good deal for the department.

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ELMS to 'skyrocket'

According to Defra, more than £2.7bn a year is being invested in farming and nature recovery. Funding for the Environmental Land Management (ELM) schemes paid to farmers ‘will skyrocket' to £2bn by 2028/29 - an increase of 150% since 2023/24.

Overall farmers and land managers will benefit from an average of £2.3bn a year through the Farming and Countryside Programme (the same average spend per year under the Conservatives), and up to £400m from additional nature schemes.

READ MORE: Practical steps to mitigate the Autumn Budget

The budget Defra said, ‘is the largest investment into nature in history, with more than £7bn directed into nature's recovery. This includes environmental farming schemes (£5.9bn), tree planting (£816m) and our peatlands (£85m) making a significant contribution to its Environment Act targets improving water quality and biodiversity.

There is also set to be a £4.2bn investment over three years in flood defences across the country – an average of £1.4bn each year and a 5% increase compared to the current Spending Review period.

Country Land and Business Association (CLA) president Victoria Vyvyan said: "While we still need further detail, it is clear that this is a meaningful funding settlement. Many farmers will be breathing a sigh of relief. 

Rural betrayal

"We now need Defra to work closely with industry to understand how to get the best bang for their buck – to further the impressive gains we have already made in nature-friendly farming. Trust and confidence have been shaken, and this is an opportunity to rebuild.

READ NOW: Defra's £2.4bn budget at 'tipping point'

"It is clear though that Government still has not fully understood the consequences of its anti-business policies. Taxes are going up, jobs are being lost and investment in the rural economy is crumbling. Now is the time to get around the table with rural business leaders and thrash out a robust and ambitious plan for growth."

Ms Reeves said: "My driving purpose since I became Chancellor is to make working people, in all parts of our country, better off. So at the Budget last October and again in the spring, I made the choices necessary to fix the foundations of our economy.

However, Shadow Chancellor Mel Stride accused the Chancellor of further betraying rural communities.

He said: "It is not enough to have hit the farmers in our country with a family farms tax. Today what we see in black and white is a choice to make further cuts to the vital grants on which farmers rely."

"A huge betrayal of farming communities, and something of which her MPs in rural areas will have to go back to their constituencies to explain."

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