By Debbie James

Farmers in Wales are unlikely to receive direct subsidies post-2025 under a radical overhaul of the farm support system proposed by the Welsh Government.

The Basic Payment Scheme (BPS) and Pillar 2 financial support for environmental projects such as Glastir could be scrapped and replaced by two new schemes set out in the government’s 69-page consultation document ‘Brexit and Our Land’.

Farmers would be able to apply for grants to boost business performance and deliver environmental schemes.

Farmers would only receive the BPS in its current form in 2018 and 2019 after which a gradual transition to the new Economic Resilience scheme would begin with a phased reduction of direct support.

But farmers’ leaders are concerned that if direct payments continue in other parts of the UK, removing them in Wales would place Welsh farmers at a disadvantage.

The government wants a complete transfer to the new arrangements by 2025 but says no changes to farm payments will be made without consultation with the industry.

The second scheme, the Public Goods scheme would offer an income stream for named ‘public good’ outcomes such as initiatives for improving water quality, reducing flood risk and improving habitats – but existing Glastir contracts would be honoured.

Both schemes would not just be open to farm businesses but to all land managers in Wales and the supply chain, which includes an estimated 10,000 rural businesses which currently receive no subsidy.

Neither scheme has yet been designed but their proposed frameworks are set out in the consultation document which the industry has until October 30, 2018, to respond to before a detailed white paper with specific proposals for consultation is published in spring 2019.

Farmers would need to demonstrate a rate of return from planned investment to secure funding from the Economic Resilience scheme.

Support would only be given if the investment can be shown to make their business more viable or allow it to remain viable.

The second scheme is also outcomes focussed.

A land manager might perhaps apply for support for carbon sequestration from planting trees. While farmers now receive a payment from Pillar 2 for planting trees, under the new scheme they could receive an annual payment for the sequestration of carbon from those trees over a given period.

NFU Cymru insists that ending direct payments would have a “massive impact’’ on Welsh agriculture with a knock-on effect across the whole of the rural economy.

The union’s president John Davies said there was a strong case for farm support.

“Just last year the NFU commissioned research which showed that for every £1 invested by government in agriculture, the industry delivers a return of around £7.40 – that’s a £1.5 billion return on the £200m a year currently spent on direct payments in Wales,’’ he said.

The Farmers’ Union of Wales (FUW) is concerned that if direct payments continue in other parts of the UK, removing them in Wales would place Welsh farmers at a disadvantage.

FUW president Glyn Roberts said the proposals had not come as a surprise.

“We have numerous concerns about what is being proposed, and we have been vociferous in raising these.

“Amongst these is the fact that the EU have recently announced their commitment to providing the farmers against which we will compete with ongoing direct support at levels similar to those currently in place.’’