Defra has announced £240m for new agreements under the revamped Sustainable Farming Incentive 2026 (SFI26) and £50m for the Countryside Stewardship Higher Tier (CSHT) scheme.
Both are part of the government’s post-Brexit Environmental Land Management schemes (ELMs), which reward farmers for actions to improve biodiversity, waterways, landscapes, habitats and soil health.
While the new funding provides “welcome certainty” for farmers, the National Farmers’ Union (NFU) says it is insufficient to meet the sector’s ambitions to deliver environmental benefits.
Robyn Munt, vice-president of the NFU, said: “Today’s budgets for key agri-environment schemes provide welcome certainty for farmers and growers, giving them a clearer basis to plan for their businesses.
“However, it is becoming abundantly clear that there is a significant gap between government and farmers ambition for ELMs and the funding to deliver it.
“At a time when farm businesses are already hard pressed by the Middle East conflict, we urge Defra ministers to step up funding to meet demand from farmers to deliver for the environment and food security.”
With over 13,000 Countryside Stewardship Mid-Tier schemes due to end this year, she said there is a “real risk the budget won’t stretch far enough to support those already delivering for nature to move into SFI26”.
“These are farmers who have spent years investing in hedgerows, looking after our waterways and creating habitats,” she added. “This contract with government must not be broken at such a critical time, bearing in mind the legislative targets government itself has set for environment delivery.
“We are incredibly frustrated that farmer ambition isn’t being met by government funding to deliver on all our agri-environment objectives.”
Defra described the updated SFI26 as a “simpler and fairer scheme” which now includes a new £100,000 annual cap to “help reach more farm businesses”.
Applications are expected to open from June 30 for small farms and those without an existing ELM revenue agreement, with a broader window available in September 2026 for other applicants.
Cath Crowther, East regional director for the Country Land and Business Association (CLA East), said: “We welcome the clarity on the budget, but our concern is that the funding may not stretch far enough.
“A £240m budget is unlikely to meet expected demand.”
She warned the funding cap and application limits could disrupt the transition for East Anglian farmers whose current agreements are ending, creating “uncertainty at a crucial time.”
She added: “It may lead to very difficult decisions on the future works our members undertake to help the environment.”
While announcing the new funding, Defra environment secretary Emma Reynolds said: “Under the previous SFI, a quarter of funding went to just 4pc of farms, so we have redesigned it to be simpler and fairer, helping more farms grow, boost productivity and protect the natural environment they depend on.”
