With the Autumn Budget approaching and a reported £22 billion black hole in public finances to address, the news has fuelled fears that the agriculture budget will be cut. However, the environmental actions it largely funds are essential to meeting England’s environmental recovery targets.

The Renters’ Rights Bill entered Parliament on 11 September. Though the main points of the Bill closely resemble the previous Parliament’s Renters Reform Bill, there are some notable differences. It proposes to introduce significant changes to the tenanted housing sector, including the scrapping of “no-fault” evictions, the introduction of Awaab’s Law on the response to risks and a revised procedure for challenging rent reviews.

FOOD & FARMING

Underspend of the agriculture budget confirmed
Defra’s Farming and Countryside Programme (FCP) annual report revealed a £358 million underspend of the agriculture budget in England over the past three years. The amounts by financial year are £103 million in 2022-23, £125 million in 2021-22 and £130 million in the last financial year. Releasing the findings, Daniel Zeichner, Defra's new Minister for Food Security and Rural Affairs, blamed the previous Conservative governments and said the Labour government will restore confidence and stability to farmers.

Reacting to the news, NFU President Tom Bradshaw blamed the underspend on the failure to develop and roll out new schemes such as Environmental Land Management (ELM) at the rate that Basic Payment Scheme (BPS) payments were being cut. The revelation is particularly concerning given that Treasury officials are looking for areas where cuts can be made to help address a reported £22 billion shortfall in public finances. In addition to potential cuts to the agriculture budget, Defra is exploring the possibility of making some parts of ELM competitive. Government sources insisted ministers have taken no decision yet.

Four former Conservative Environment Secretaries warned the government against cutting ELM funding. In a letter, they said the rumoured cut would reduce the amount of farmland under the schemes by 239,000 hectares in England. They pointed out that uptake of the scheme had been increasing over time and urged ministers to maintain the farming budget or even increase it in line with inflation. The letter was signed by Michael Gove, Andrea Leadsom, Therese Coffey, Theresa Villiers, and six other former Conservative farming and environment ministers.

Further measures against the bluetongue virus
The Chief Veterinary Officer has set out further measures to combat the spread of the bluetongue virus in the UK. Changes include extending a restricted zone in Kent to cover the entire county and East Sussex. An extended restricted zone will replace the temporary control zone in force in the East Riding of Yorkshire and parts of Lincolnshire. East Riding and Lincolnshire have also been designated high-risk counties, meaning keepers not covered by the new zone will be eligible for free testing.

Keepers can also vaccinate their animals under a new general licence. The Secretary of State permitted the use of three unauthorised bluetongue serotype 3 (BTV-3) vaccines within the UK. These vaccines will reduce some of the clinical signs experienced by animals with the disease but do not prevent infection. For this reason, all movement controls and trade restrictions will still apply to vaccinated animals. Defra is publishing the latest information here.

Sheep and cattle population at a record low
Sheep and cattle populations in England are at a record low. As of June 2024, the English sheep flock had declined in number by 4.3% compared to the same time the previous year. Defra's annual livestock survey shows the total population is 13.8 million head. For sheep, a 390,000 head fall in the breeding flock was chiefly to blame, accounting for nearly two-thirds of the decrease in population. The total cattle population fell by 2% in the same period to 5 million head. The beef breeding herd drove the decline, falling by 5.1%. Recent robust beef prices and pressures on overall margins are likely to have incentivised culling.

POLICY

Scotland: new legislation to replace interim net zero targets
As part of the legislative programme set out recently for government in Scotland, the Climate Change (Emissions Reduction Targets) Scotland Bill has been published. It will allow the government to modify the targets for reducing greenhouse gas emissions. In April of this year, Scotland scrapped its pledge to reduce emissions by 75% by 2030, one of several interim emissions targets on the journey towards its net-zero goal. The draft Bill proposes a new system - instead of following these interim targets, Scotland will use carbon budgets to work towards its emissions goals. These budgets specify the amount of carbon dioxide that can be released over five years, gradually decreasing until reaching net zero in 2045. The Bill also states that a carbon budget report and an annual report on emission reductions must be produced for every budget period. The budget model for emission reduction assessments is used by various nations, including Japan and France, and is an established method of working towards net zero. Cabinet Secretary for net-zero Gillian Martin said that the bill will provide a more reliable framework for emissions reduction.

New select committee chairs announced
Alistair Carmichael MP has been elected unopposed as the Chair of the Environment, Food and Rural Affairs (EFRA) Committee, which holds Defra accountable in Parliament. He is a Liberal Democrat and was born and raised on a hill farm on Islay. He has said he wants to “give a voice to rural, coastal and island communities” and “contribute to setting a political agenda for meaningful and realistic food security in the UK – balancing the needs of agricultural land use against policies of other departments, most notably energy generation”.

Toby Perkins MP has been elected as chair of the Environmental Audit Committee (EAC) following a close 17-vote win against Barry Gardiner, a member of the previous EAC. In 2023, Mr Perkins held the position of shadow minister for nature. He advocated for improved water industry regulation to protect the environment via better monitoring of sewage outlets and increased protection of peatlands.

Water (Special Measures) Bill introduced to Parliament
The Water (Special Measures Bill) was introduced to Parliament following its initial announcement in the King's Speech in July. The Bill is primarily focused on accountability and will increase the ability of the Environment Agency to enforce criminal charges against water company executives who break laws that are designed to improve the cleanliness of water networks in England and Wales. It will also ban bonuses for executives who fail to meet environmental standards. The Bill also introduces “automatic penalties” for various offences. It aims to ensure independent monitoring of every river outlet that requires the publication of near real-time data on discharges from emergency overflows. Baroness Hayman of Ullock, Parliamentary Under-Secretary of State for Defra, said the Bill was a “first important step in enabling long-term and transformative change across the water sector”.

ENVIRONMENT & NATURAL CAPITAL

Scotland: legal challenge blocks commercial forest
Scottish Forestry has decided to issue an immediate stop notice to a Guernsey-based investment fund that the government had granted £2 million in order to create a 10 square kilometre area of forest in the Scottish Borders. This action was prompted by the findings of a judicial review, which revealed that blanket herbicide spraying had been carried out on approximately 400 hectares of the site. It was discovered that the project had been allowed to proceed without an environmental impact assessment due to the investment fund failing to disclose crucial information related to the project.

As a result of these findings, Scottish Forestry has initiated enforcement action to halt the developer’s activities whilst it conducts a reassessment of the woodland creation application and considers the newly disclosed information. When the project was initially approved, a local action group opposed it due to concerns about the potential impact on the habitats of various rare species, including black grouse and golden eagles.

New flood preparedness task force launched
A "Flood Resilience Taskforce" has been established to assist in creating flood defences and enhance the country's ability to withstand extreme weather. The task force comprises the Secretary of State for Defra, the Floods Minister, representatives from Defra, the Home Office, the Cabinet Office, the MET Office, Local Resilience Forums, mayoral offices, emergency responders, and the National Farmers Union, among other stakeholders. During the initial group meeting, the task force discussed ways to expedite flood preparation and improve coordination among the stakeholders involved. In the UK, 5.5 million properties are at risk of flooding, and the Met Office predicts a wetter-than-usual autumn this year.

PROPERTY & DEVELOPMENT

Renters’ Rights Bill enters Parliament
The Renters’ Rights Bill had its first reading in Parliament on 11 September 2024 and is anticipated to become law by summer 2025. The Bill, which largely follows the Conservative's Renters (Reform) Bill, amends the Housing Act 1988 to remove the ability to serve section 21 notices for “no-fault” evictions whilst creating new grounds for eviction that are available to landlords. The Labour government has made some changes, including the insertion of Awaab’s Law, the Decent Home Standard and a single-stage implementation process, meaning that the changes will apply to both existing and new tenancies simultaneously. Further details can be found in our latest briefing note.

Scotland: Ban on wood-burning stoves paused
The Scottish government has temporarily dropped restrictions on the installation of wood-burning stoves. The New Build Heat Standard came into effect in April 2024 and prevented the installation of direct-emission heating systems, including gas or oil boilers, in new homes and buildings. The new rules were designed to reduce air pollution by encouraging builders to install clean heating systems such as heat pumps. A review of the rules started in May after concerns surrounding the specific impact on rural residents. Climate Action Minister Alasdair Allan recently wrote to council bosses across Scotland confirming that the restriction on installing wood burners and other bioenergy (and peat) heating systems has been temporarily dropped, saying the review's outcome will be implemented by the end of December 2024.

BUSINESS & economy

Tenanted land practices survey results
Defra’s June 2024 Agricultural Tenanted Land Practices survey results have been released. Based on 3,900 responses, the results show a small proportion are being asked to surrender some of their land by their landlord, but for the majority, their tenanted land area has been stable over the last two years, and they expect this to continue. Key findings include:

• Over three-quarters (78%) of respondents said the land area they rent has stayed the same over the last two years. 11% reported an increase.
• One-in-10 reported a decrease in land area in the same period. The most common reason was the landlord asking the tenant to surrender rented land before the end of the agreement (33%).
• Where a change in land area was seen, the most common scale of change was by less than 25%.
• 59% of respondents said they expected the land area they rented to remain unchanged over the next two years.

Discounted loan fees offered for sustainable practices
Like the food chain, banks are under pressure to reduce the carbon emissions associated with their business. For many, a disproportionate amount of the emissions they ‘fund’ can be found in their agricultural loan book, so incentives or initiatives to help farmers adopt sustainable practices are starting to emerge. For instance, Lloyds Bank is funding sustainability measurement and advice for some customers via the Soil Association Exchange. HSBC UK has just announced it will offer farmers discounted loan fees to support the uptake of sustainable practices. The HSBC Sustainable Farming Pathway has been launched alongside LEAF (Linking Environment and Farming). Any business with the LEAF Marque certification and those which undertake a LEAF Sustainable Farming Review will be eligible for discounts on lending amounts above £25,000.

Electricity System Operator sold to the government
National Grid’s Electricity System Operator (ESO) business will be sold to the government for £630 million. It is responsible for balancing electricity supply and demand second by second and advising on network investment. The deal is expected to close on 1 October 2024 to coincide with the new National Energy System Operator (NESO) launch. The NESO is intended to oversee the planning and operation of the UK’s electricity and gas networks, expanding the role of the ESO to include network planning, market development and supply security. NESO will take a cross-sector approach involving electricity, gas and hydrogen, renewable generation, storage and other technologies such as carbon capture.

OTHER RURAL NEWS

And finally…Dragon’s Den for dairy
Young farmers in Scotland can pitch project ideas to a new Dragon’s Den competition led by Scotland’s Rural College. The panel is looking for projects that tackle challenges in the dairy sector, such as animal welfare, energy consumption, the use of digital technology, and even animal nutrition. Farmers aged between 16-30 years old can apply. Successful pitches could be developed through the Digital Dairy Chain initiative into a real research project with a grant of up to £10,000. So far, the Digital Dairy Chain has supported 35 projects.

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