Environmental Land Management Scheme (ELMS)

14 Apr 2022

Tractor in field

The UK’s new farm subsidy system is known as the Environmental Land Management Scheme (ELMS), based on the premise of paying ‘public money for public goods’. The aim is that payments reward farmers for improving their natural capital. There will be three different schemes under ELMS; Sustainable Farming Incentive (SFI), Local Nature Recovery (LNR) and Landscape Recovery.

The Sustainable Farming Incentive (SFI)

The Sustainable Farming Incentive aims to improve soil health, as this is critical for improving biodiversity as well as generating more healthy crops. It will be accessible to all farmers, with the aim of being straightforward to understand and follow.

There are currently eight SFI standards that farmers can use to class their land and within each standard there are three payment categories (introductory, intermediate and advanced) depending on how much of the criteria the land fulfils. To get into a higher payment bracket, additional activity need to be undertaken to qualify. Some of these activities are very similar to those seen before under BPS, such as buffer strips and hedgerow managements, however, newer activities include reducing inputs and soil testing for organic matter.

Local Nature Recovery (LNR)

The LNR scheme is designed to pay more for environmental purposes rather than environmental improvements. The scheme sets various targets within local regions that a group of farmers can tackle together. This may include anything from flood protection along a section of river to controlling invasive species.

Landscape Recovery

Landscape Recovery aims to tackle large scale environmental changes (for projects between 500 to 5,000 hectares). Under this scheme, groups of landowners are encouraged to co-operate to create an outstanding area that wouldn’t have been possible for them to create individually. There are already pilot projects underway, which will eventually be worth circa £800 million per year.

We have provided advice to landowners as to how best to collaborate when working together to deliver Landscape Recovery schemes. There are both detailed commercial and tax issues which need to be considered.

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