Farming exit scheme Published 8 February 2022

[Janet Hughes Defra]

Good afternoon all

Today we've published information about our lump sum exit scheme for farmers who wish to exit the industry.

The new Lump Sum Exit Scheme will support farmers in England who wish to leave the industry though a lump sum payment, allowing them to exit the sector in a managed way. We expect farmers will be able to apply from April to the end of September 2022.

To be clear, this is not intended to push anyone to leave – it’s for those who want to leave, where a lump sum payment might help them to do so in a managed way.

We’ve also confirmed that the Government intends to legislate to make clear that lump sums paid out under the scheme will be treated as capital for tax purposes.

The news release is here: https://www.gov.uk/government/news/...upport-farmers-who-wish-to-leave-the-industry

The Government response following our consultation about the scheme last year is here: https://www.gov.uk/government/consu...rs-lump-sum-exit-scheme-and-delinked-payments

Details of the scheme can be found here: https://www.gov.uk/government/publi...-or-retire-from-farming-and-delinked-payments

Happy to answer any questions about the policy - the RPA are standing ready to answer any specific questions about your individual circumstances and eligibility on their normal helplines:

Email: [email protected]

Telephone: 03000 200 301

 

[delilah]

Got anything for those who wish to stay ?

 

[daveydiesel1]

Y

Got anything for those who wish to stay ?

Yes plenty of headaches

 

[deleted user 436632456]

Am I right in thinking that a father could take the lump sum and a family member i.e. son/daughter could rent the land under a different business/company?
Or have I missed that bit in t&c's?

 

[Janet Hughes Defra]

Got anything for those who wish to stay ?

Yes, this is just one small part of the overall picture which we set out in the Agricultural Transition Plan in November 2020 https://www.gov.uk/government/publications/agricultural-transition-plan-2021-to-2024

We have a range of schemes for farmers continuing in the sector, including:
* farming investment fund to support investment in on-farm productivity improvements
* innovation, research and development investment to support new research and also adoption of new tech and practices on farmers
* resilience fund to provide free business planning advice to farmers https://defrafarming.blog.gov.uk/2021/07/13/the-future-farming-resilience-fund-providers-named/
* environmental land management schemes for those who want to produce public goods alongside food production - existing schemes, to be followed by new schemes

 

[D14]

Am I right in thinking that a father could take the lump sum and a family member i.e. son/daughter could rent the land under a different business/company?
Or have I missed that bit in t&c's?

You can't claim it twice!

 

[Sonoftheheir]

Am I right in thinking that a father could take the lump sum and a family member i.e. son/daughter could rent the land under a different business/company?
Or have I missed that bit in t&c's?

Its BPS money early isn’t it?

 

[deleted user 436632456]

You can't claim it twice!

I get that you have to surrender all BPS payments, but BPS or in any other forms might not be the future for all of us.

When ground rent's have all been inflated to include any entitlements and for some of us with other interests with agricultural ground there have been rumblings that any payments will not be for us in the very near future..

I've always had the view that any form of subsidy is just a big stick that they turn round and beat you with.

Why not just take the money and run (in agriculture with another trading name)

 

[D14]

I get that you have to surrender all BPS payments, but BPS or in any other forms might not be the future for all of us.

When ground rent's have all been inflated to include any entitlements and for some of us with other interests with agricultural ground there have been rumblings that any payments will not be for us in the very near future..

I've always had the view that any form of subsidy is just a big stick that they turn round and beat you with.

Why not just take the money and run (in agriculture with another trading name)

The son won't need to rent it. He could just start farming it by taking over the business and the father retiring in the official way i.e. coming out of the business whether its a ltd company or partnership. It just means no more subsidy for that business.
It won't affect claims on the new ELMS stuff etc.

 

[topground]

Should have been published on April 1st.
No thanks.

 

[colhonk]

No fly`s on the gov, give a lump sum then snaffled a big chunk back in tax, OH hang on, they do this already with the bps.

 

[deleted user 436632456]

The son won't need to rent it. He could just start farming it by taking over the business

Some fathers give their ground for free?? Must break that to the old boy this afternoon

It's probably not a bad deal for some of the slipper farmers, get a lump sum now and still add it onto the rent

 

[D14]

Some fathers give their ground for free?? Must break that to the old boy this afternoon

It's probably not a bad deal for some of the slipper farmers, get a lump sum now and still add it onto the rent

If the older generation start charging their children for land there won't be any farming in this country.

 

[farmerm]

Am I right in thinking that a father could take the lump sum and a family member i.e. son/daughter could rent the land under a different business/company?
Or have I missed that bit in t&c's?

Wouldnt really make much sense in most cases? Either keep entitlements and claim annual payments for last four years spread over four years or forfeit the last four years payments on that land in exchange for a lump sum. In many cases taking the lump sum will be tax inefficient.

 

[pellow]

basically 2.35 x BPS with £100k max payment that will be treated as capital

Politically, it will be known that not many farmers will want to accept this offer, the amount of money is a lot to the average Joe but not medium scale farmers, so in the future, when farmers are moaning about incomes, the government can say that they have offered farmers a generous offer to retire

 

[CornishTone]

Cue frantic land grab by big corporates and misguided celebrities with zero sympathy or connection with the land but a desire to cash in on offsetting, tree planting and rewilding, as well as furthering government policy to get rid of small farms and farmers.

Well done Boris and DEFRA, another kick in the guts for British ag.

 

[teslacoils]

The appeal is not strong.

Queue raft of "well, we offered them all the money but noone took it" guff. If your farm tenancy includes a house, you'd be bonkers to take the money.

Only folk it will appeal to are those who are about to build a housing estate on the land anyway.

 

[D14]

Cue frantic land grab by big corporates and misguided celebrities with zero sympathy or connection with the land but a desire to cash in on offsetting, tree planting and rewilding, as well as furthering government policy to get rid of small farms and farmers.

Well done Boris and DEFRA, another kick in the guts for British ag.

Thing is if in a few years a big corp or celeb offers us big money to buy the land to plant trees then I am afraid we will be getting out as it'll set up future generations to have easier lives. It will have to be a very silly offer though but I am not averse to selling up.

 

[teslacoils]

Cue frantic land grab by big corporates and misguided celebrities with zero sympathy or connection with the land but a desire to cash in on offsetting, tree planting and rewilding, as well as furthering government policy to get rid of small farms and farmers.

Well done Boris and DEFRA, another kick in the guts for British ag.

Govt policy can never just be "leave them alone". Despite the promises to cut red tape etc, there seems zero desire to do anything that may a) reduce civil servants or B) lessen the need for huge IT procurement and the inevitable ballsup for users and huge envelope full of money for suppliers who turn out to be donors or subsequent employers of Mps as "consultants".

 

[farmerm]

I have long struggled to see the point of this scheme.. on top of the taxation issues if it was actually seen as an attractive offer for some to use to leave the industry, the narrow window to do so could result in short term oversupply and a short term depression in land values.