Government announces Lump Sum Exit Scheme – but link to BPS will exclude many pig farmers

The Government has announced a new Lump Sum Exit Scheme for farmers in England who wish to leave the industry. 

However, the scheme will apply only recipients of BPS payments, so will be of limited interest to pig farmers who receive little or no BPS payment, and who might currently be considering their future in the industry.

The Lump Sum Exit Scheme is due to open in April and the application period will run until the end of September. In return for their payment, farmers will surrender their BPS entitlements and be expected to either rent or sell their land or surrender their tenancy, in order to create opportunities for new entrants and farmers wishing to expand their businesses.

The payment will be based on the average direct payments made to the farmer for the 2019 to 2021 BPS years. This reference figure will be capped at £42,500 and multiplied by 2.35 to calculate the lump sum, meaning that farmers could receive up to around £100,000.

The Government has also been working with in partnership with industry leaders, local councils and land owners to design a New Entrants scheme to create ‘real opportunities’ for new farmers, Defra said.

The lump sum scheme follows a public consultation carried out last year where the majority of respondents supported the initiative. It builds on evidence that some farmers would like to retire or leave the industry but have found it difficult to do so for financial reasons, Defra said.

The BPS will be replaced by delinked payments in 2024. This means that recipients won’t have to farm the land to receive the payments until they have been phased out by the end of 2027. A farmer may get delinked payments even if they choose to stop farming altogether. Those who continue farming will still have to comply with standards on the environment, plant health, and animal welfare.

Defra Secretary George Eustice said: “Those of us who grew up with farming know the emotional connection farmers have with their land and the decision to retire or to exit the industry can be extremely difficult and is frequently postponed.

“The purpose of The Lump Sum Exit Scheme is to assist farmers who want to exit the industry to do so in a planned way and provide them with the means to make a meaningful choice about their future. The Scheme will also free up land for new entrants to farming and those who want to expand their businesses.”

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Editor of LBM titles Pig World and Farm Business and group editor of Agronomist and Arable Farmer. National Pig Association's webmaster. Previously political editor at Farmers Guardian for many years and also worked Farmers Weekly. Occasional farming media pundit. Brought up on a Leicestershire farm, now work from a shed in the garden in Oxfordshire. Big fan of Leicester City and Leicester Tigers. Occasional cricketer.