Support paid to farmers under the 2016 Basic Payment Scheme will be higher than anticipated in England after an increase in the value of entitlements.
Farmers had been anticipating a 16.5% increase in the value of 2016 payments, as a result of a fall in the value of sterling since Brexit.
This has been beneficial as payments are set in euros and then converted to pounds using the average exchange rate across the month of September.
However, this week the Rural Payments Agency announced that the value of entitlements will also be 2% higher than in 2015, pushing the overall increase in payments close to 19%.
George Chichester, partner at Strutt & Parker, said: “Farmers will be subject to a reduction known as financial discipline, which will slice off 1.353905% of all payments over €2000, to enable the EU to create a crisis fund for farming.
“However, even taking this into account, the payment for lowland ground in England will be £212.69/ha which is nearly £34/ha more than in 2015.
“Payments for upland ground will be £211.16/ha and moorland £55.79/ha.”
The RPA is expected to start making payments to farmers from 1 December 2016.
The exchange rate that will be used to calculate all payments in 2016 is €1 = £0.85228. This compares to £0.73129 in 2015.
2016 entitlement values – including greening payment, but before Financial Discipline
€252.98 for lowland (non-Severely Disadvantaged Areas)
€251.16 for upland, other than moorland
€66.36 for moorland